Olyaie

MEMORANDUM *

Ray H. Olyaie was one of a number of operators of Valero service stations who were offered the opportunity to purchase their respective stations. Olyaie signed a Purchase and Sale Agreement with Valero with respect to his service station in January 2001. After several extensions of the closing date, the closing of the sale and purchase of Olyaie’s service station was set for Monday, April 30, 2001.

*608 Olyaie sought the necessary financing for his purchase from General Electric Capital Business Asset Funding Corporation (“GE Capital”). On March 19, 2001, GE Capital and Olyaie executed a Conditional Loan Commitment Letter Agreement (“Letter”), whereby GE Capital agreed to lend Olyaie $700,000 subject to certain terms and conditions. In particular, GE Capital was concerned about environmental pollution at the service station site and required environmental insurance to cover this risk before it would lend to Olyaie. GE Capital scheduled the closing of the financing for Olyaie and other Valero service station purchasers for Tuesday, April 24. However, on the morning of the scheduled closing, Olyaie and others were told that the closing was cancelled without…

dissenting:

GE Capital agreed to finance Olyaie’s purchase of a gas station if he met certain conditions designed to minimize GE Capital’s liability for contaminated gas tanks at the site. The key condition relevant to this case required Olyaie to obtain an indemnification agreement from Valero/Exxon that was acceptable to GE Capital. In a February 14, 2001, letter predating the signing of the actual loan agreement, GE Capital indicated that it might be willing to waive this condition, should Olyaie obtain a supplemental pollution liability policy from AIG, and it subsequently acted as a liaison between Olyaie and AIG. But at no point did GE Capital indicate that it was willing to waive the indemnity provision—unless Olyaie obtained an AIG pollution liability policy.

The parties do not dispute whether Olyaie had obtained either an acceptable indemnification agreement or a supplemental AIG policy by the scheduled closing date, April 24, 2001. He had not. Thus, the condition precedent to GE Capital’s obligation to fund the purchase had not been met, and GE Capital had no obligation to close the loan on the scheduled date. For this reason, Olyaie has no breach of contract claim.…