JADE FASHION & CO., INC., Plaintiff and Respondent, v. HARKHAM INDUSTRIES, INC., et al., Defendants and Appellants., 229 Cal. App. 4th 635

Summary

HOLDINGS: [1]-As a matter of law, a discount provision in an agreement between a buyer and a seller regarding the repayment of a debt was not an unenforceable penalty or forfeiture because the buyer remained liable to the seller for the full amount of its debt, given that it failed to fully perform under the agreement by paying five installments late; [2]-A provision in the agreement that "time was of the essence" with respect to each installment payment was unambiguous, as it clearly and explicitly stated that the buyer would not be entitled to the discount if it failed to fully and timely pay each installment when due; [3]-Because the seller's procurement and retention of a $30,000 overpayment did not result in any prejudice to the buyer, given that the seller agreed to credit the overpayment to the balance owed by the buyer under the agreement, the unclean hands defense did not apply.