Reference no: EM132194983

Arnhold and Argoudelis farmed 280acres near a fast-growing suburb of Chicago. They agreed to sell the land to Ocean Atlantic (Ocean), which planned to develop it into a residential subdivision. The parties agreed to cooperate and make sure that the conditions necessary for the development, such as the property would be annexed and rezoned, would be done before the closing date of November 1, 1997. When that had not happened by the deadline despite their best efforts, they agreed to extend the deadline until January 15, 1999. Ocean met with planning official, but by the fall of 1998, the parties agreed to new date for closing, the final being January 25, 2001. They also agreed to a time-is-of-the-essence clause. On January 18, Ocean sent a letter demanding a new closing date of May and demanding Arnhold and Argoudelis to pay $680,000 in development fees, a new term it introduced then. They refused. On January 25, Ocean failed to tender the $7.26 million at the closing, and the sellers declared the contract terminated. Ocean sued for specific performance. Did Ocean materially breach the contract? Explain.