LandSource debtor sues property buyer for breach of contract

By Caroline Salls

Pittsburgh, April 3 - LandSource Communities Development LLC debtor LNR-Lennar Washington Square, LLC filed a breach of contract lawsuit Friday against property purchaser Dolce View (Los Angeles) LLC because the buyer has allegedly refused to close on the $45 million property sale, according to a filing with the U.S. Bankruptcy Court for the District of Delaware.

According to the complaint, LNR had satisfied all of its closing conditions as of March 17, and the sale closing was originally scheduled for March 19.

However, Dolce View raised a number of issues regarding a punch list, insurance policies and closing documents.

Although it claims none of the issues raised by the buyer were legitimate, LNR said it still agreed to substantial concessions in order to complete the sale.

"Despite all this, Dolce View refused to close," LNR said in its complaint.

The lawsuit also names CIM Fund III LP as a defendant. LNR said the fund guaranteed all of the buyer's damages payment obligations.

LandSource, a Los Angeles-based developer of master-planned communities, filed for bankruptcy on June 9, 2008. It Chapter 11 case number is 08-11111.

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