EXCLUSIVE: Rocker Steve Miller is sued by ex Toys 'R' Us CEO for backing out of a $6.7 MILLION deal to buy his massive upstate New York home

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Rock and Roll Hall of Fame musician Steve Miller is being sued by a former Toys 'R' Us chief executive and his wife for backing out of a $6.7 million deal to buy their massive home in upstate New York.

John and Gail Eyler agreed to sell their home on Seeley Road in Lagrangeville to Miller and his wife Janice in December, 2016.

The enormous estate sits on more than 87 acres and includes a waterfall, pool, guest cottage and vistas spanning the Hudson Valley and Catskill Mountains. 

Miller agreed to pay $6.7 million for the property with a down payment of $670,000 to be held in escrow.

Rock and Roll Hall of Fame star Steve Miller is being sued for backing out of a deal to buy a New York couple's $6.7 million home in Lagrangeville, New York

John Eyler, a former Toys 'R' Us chief executive and his wife Gail (above) want to keep Miller's $670,000 down payment 

According to legal documents obtained by DailyMail.com, Miller chose to back out of the deal because he was denied a $3 million mortgage loan after the house was 'greatly undervalued'

But the Eylers claim Miller's bank rushed to obtain an appraisal of the estate, which 'greatly undervalued' the home at $4.3 million.

This led the bank to reject Miller's mortgage application for $3.35 million and he chose to back out of the deal.

The couples tried to come to an agreement but one day before the contract was due to close, the Millers terminated the deal and demanded the return of their down payment.

According to legal documents obtained exclusively by DailyMail.com, the Eylers claim Miller did not have the right to terminate based on an 'unsatisfactory appraisal'.

The contract also states that the purchase of the home was not contingent on any mortgage application.  

 The Eylers claim Miller did not have the right to terminate based on an 'unsatisfactory appraisal' as the contract states the purchase was not contingent on any mortgage application

 The enormous estate sits on more than 87 acres and includes a waterfall, pool, guest cottage and vistas spanning the Hudson Valley and Catskill Mountains

 The property boats three bedrooms, five full bathrooms and is over 7,000 square feet 

John Eyler's lawyers claim that since Miller is worth in excess of $40 million, he has the financial ability to buy the home without a mortgage loan and is in 'breach of contract'

Their lawyers say that as he is worth in excess of $40 million, he has the financial ability to buy the home without a mortgage loan.

Born in Wisconsin, Miller, now 73, emerged in the cultural mix of 1960s San Francisco and his band has sold more than 40 million records over 40 years. Pictured above in 1965

They also mention that his band - the Steve Miller Band - is currently selling tickets to its 2017 U.S. tour, set to begin in March. 

The couple filed the lawsuit demanding a judge to award them Miller's down payment because he 'breached the contract'. 

In a statement to DailyMail.com the Eylers' attorney, Mitchell R. Schrage of Kasowitz, Benson, Torres & Friedman LLP said: 'Steve Miller, through his limited liability company, has willfully breached his contract to purchase this magnificent property. 

'The Eylers are confident that they will prevail against Mr. Miller in court.' 

Born in Wisconsin, Miller emerged in the cultural mix of 1960s San Francisco and his band has sold more than 40 million records over 40 years. 

He still plays at age 73 and was inducted into the Rock and Roll Hall of Fame in 2016.

In June of last year, Miller put his bay-front home and 39 fenced acres on Washington state's San Juan Island up for sale at $16.8 million. 

John H. Eyler Jr., 69, served as president and chief executive officer of Toys 'R' US from January 2000 to July, 2005.

John Eyler, 69, served as president and chief executive officer of Toys 'R' US from 2000 to 2005 and his wife, Gail, was vice president of merchandising for menswear at Ralph Lauren

And according to Bloomberg News, he received cash and benefits worth around $63 million as part of the struggling toy retailer's purchase by an investment group that same year.

The toy tycoon was also chairman and CEO of FAO Schwarz from June 1992 to January, 2000.

A Harvard MBA graduate and father of three sons, he sits on the board of a number of charitable organizations alongside his wife, Gail.

Gail Eyler is currently a 'leader' at the World Wildlife Organization, having spent her entire career in apparel wholesaling and retailing.

Most recently she was vice president of merchandising for menswear at Ralph Lauren.