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and ceased development of the remaining 56 lots (i.e., 133 lots
minus 77 lots that were developed and sold).
In 1987, petitioner asked several developers whether they
were interested in purchasing the 56 lots. On February 10, 1988,
more than a year after it ceased developing the Marlboro tract,
HJV sold the 56 lots to Eli and Sol Kramer, real estate
developers and principals of the Kramer Group. The Kramers
operated their real estate development business through several
entities. The contract between HJV and the Kramers delineated
that the 56 lots would be sold in three transactions. On May 5,
1988, 17 lots were sold for $2,650,000. On May 15, 1989, 20 lots
were sold for $3,230,000, payable partially in cash with the
balance secured by a note and a mortgage on a portion of the 20
lots. The sale of the remaining 19 lots was scheduled to occur
on May 6, 1991.
Sometime after the 1989 sale, the Kramers began experiencing
financial difficulties and asked petitioner to renegotiate their
contract with HJV, but petitioner refused. On February 15, 1991,
the Kramers defaulted on the note and mortgage relating to the
1989 sale. On March 8, 1991, the Kramers filed a complaint
against HJV in the Chancery Division of the Superior Court of New
Jersey, claiming misrepresentation relating to the contract and
seeking rescission of the 1991 sale. HJV filed a counterclaim
for damages relating to the Kramers' breach of contract. Under
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