In a sale of a business where the buyer’s obligation depends on zoning-board approval, a court may rule that the buyer is entitled to damages if the seller refuses to perform when the condition is not satisfied and the evidence shows the condition existed. Which option best fits this scenario?

• A. The seller can recover damages for breach regardless of the zoning condition.
• B. The buyer cannot recover because the condition was not satisfied.
• C. The buyer prevails because the condition existed and the contract was conditioned on it.
• D. The contract is void.

Answer: (C)

A sale conditioned on zoning-board approval uses a condition precedent: the parties’ obligations to close depend on that approval actually being obtained. When there is evidence the contract contemplated this condition, the seller’s duty to perform is not triggered until the zoning approval occurs. If the seller refuses to perform while the condition is still unresolved, that refusal breaches the contract because performance was conditioned on the approval taking place. Since the condition existed and the seller refused to perform despite that, the buyer is entitled to damages for breach. The other options misstate the effect of a condition precedent or the consequences of refusal to perform.