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TARGET SPORTSWEAR v. CLEARFIELD FOUNDATION (03/30/84)

filed: March 30, 1984.

TARGET SPORTSWEAR, INC., APPELLANT,
v.
THE CLEARFIELD FOUNDATION



No. 1391 Pittsburgh 1983, APPEAL FROM THE ORDER ENTERED NOVEMBER 14, 1983 IN THE COURT OF COMMON PLEAS OF CLEARFIELD COUNTY, CIVIL NO. 83-18 EQU.

COUNSEL

Leonard Dubin, Philadelphia, for appellant.

Carl A. Belin, Jr., Clearfield, appellee.

Spaeth, President Judge, and Cirillo and Johnson, JJ. Spaeth, President Judge, files a concurring opinion.

Author: Cirillo

[ 327 Pa. Super. Page 5]

In this equity action seeking a decree for specific performance, the trial court denied relief. This appeal followed.

The case centers around a factory building and lot in Clearfield County known as the "Cleardon" property. Appellee, the Clearfield Foundation, holds and at all times pertinent to this appeal has held title to the premises. Appellant, Target Sportswear, Inc., occupied the building beginning on July 1, 1982, under an oral month-to-month lease. At the time Berg Electronics, a division of E.I. DuPont de Nemours and Company, held an option to buy the property, and had given its approval to Target's month-to-month tenancy.

Berg's option was due to expire on October 2, 1982. In early October Target expressed interest in buying the property. Negotiations with the Foundation ensued, and after

[ 327 Pa. Super. Page 6]

    expiration of Berg's option to purchase, the Foundation offered the property to Target in a letter signed by Foundation president Ralph Kane and dated November 8, 1982. The letter, addressed to Mr. Morris DeMatteo, Vice President of Target Sportswear, stated:

Dear Mr. DeMatteo:

Following a meeting of the members of the Clearfield Foundation, I have been instructed to offer to you the "Cleardon" building and lot totaling 5.82 acres upon the following terms and conditions:

1. We will sell you the property for a sum of $350,000;

2. No repairs and/or changes will be made at the expense of the Clearfield Foundation;

3. We would propose that we would be willing to enter into an agreement of under the following financial arrangements:

A. Ten percent (10%) of the purchase price to be paid upon execution of the agreement by Target funds;

B. Sixty percent (60%) of the purchase price to be financed through P.I.D.A. for fifteen (15) years at an interest rate of three percent (3%). As you want to get into the building as soon as possible, and we want to sell, we propose the Clearfield Foundation receive the three percent (3%) interest payment until such time as the loan is approved with P.I.D.A. and the monies received from them. However, this time period would not extend beyond four (4) months from the agreement date.

C. The remaining thirty percent (30%) of the purchase price to be financed through our local banks for fifteen (15) years at an interest rate of fifteen (15) percent with five (5) points. This financing may be arranged by Target through banks of their preference;

4. That possession would pass upon execution of the agreement;

5. That the risk of loss, maintenance, and liability for municipal assessments and taxes would be the responsibility

[ 327 Pa. Super. Page 7]

    of the purchaser from and after the date of execution of the agreement; and

6. This proposal will expire on December 10, 1982.

If this proposal is acceptable to you, please sign the copy of this letter as it is enclosed and return it to the undersigned. The agreement will be prepared as soon as this acceptance is received.

DeMatteo signed the letter on the line provided and returned it to Kane on December 7, 1982. Next to the signature line, over DeMatteo's initials, had been typed "Subject to finalizing terms and conditions of agreement of sale." Also, paragraph 3.C. of the letter had been crossed out and initialed by DeMatteo.

Along with the returned Foundation letter, DeMatteo had sent the following cover letter:

Dear Mr. Kane:

On behalf of TARGET SPORTSWEAR, INC., it is my pleasure to inform you that a decision has been made to accept Clearfield Foundation's proposal of sale of the "Cleardon" building and lot, as offered in your letter dated November 8, 1982. ...


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