Bloomer v. Phillips
| Decision Date | 01 November 1990 |
| Citation | 562 N.Y.S.2d 840,164 A.D.2d 52 |
| Parties | Gary BLOOMER et al., Respondents, v. Ernest W. PHILLIPS et al., Appellants. |
| Court | New York Supreme Court — Appellate Division |
Englert, De Angelus, Stillman, McHugh & De Angelus (Dennis M. Englert, of counsel), Schenectady, for appellants.
Maynard, O'Connor & Smith (Brian R. Le Cours, of counsel), Albany, for respondents.
Before KANE, J.P., and WEISS, MIKOLL, YESAWICH and MERCURE, JJ.
KANE, Justice Presiding.
On September 22, 1983, defendants contracted to sell certain premises in Saratoga County, together with the buildings situate thereon, to plaintiff Gary Bloomer for $110,000. The contract was later amended, inter alia, to increase the purchase price to the sum of $115,000 and the following provision was added:
At the time of closing, the Sellers shall execute a first purchase option for the property reserved from the sale in favor of the purchasers, which shall give the purchasers the right to purchase the parcel for $10,000.00 in the event the sellers do not improve the property with a dwelling and chose [sic ] to sell the parcel as vacant land.
The closing was held on April 5, 1984 and, accordingly, an instrument bearing that date entitled "purchase contract and option" was executed by defendants and granted to plaintiffs "an irrevocable right and first option to purchase" an adjoining unimproved parcel of approximately 1.26 acres. This instrument further provided that:
This irrevocable right and first option shall run in favor of [PLAINTIFFS] ON THE CONDITION THAT [DEFENdants], their heirs or assigns, shall offer the aforementioned described parcel for sale prior to a single-family dwelling being erected on the premises.
In the event [defendants], their heirs or assigns, choose to offer this parcel for sale, it must first be offered for sale in writing, return receipt, to [plaintiffs] for the sum of $10,000.00. The aforesaid [plaintiffs] shall have 30 days thereafter within which to exercise their option which must be done in writing.
This Agreement shall be binding upon the heirs and assigns of [defendants].
The rights and privileges under this Agreement cannot be assigned by [plaintiffs] without the written consent of [defendants].
On September 18, 1984, defendants notified plaintiffs that they intended to sell the adjacent parcel to a third party and that, under the contract, plaintiffs had 30 days to exercise their right to purchase the property. Defendants later withdrew the option to purchase on September 25, 1984, notifying plaintiffs that they had decided not to sell. On October 18, 1984, plaintiffs delivered an "exercise of option" to defendants purporting to elect to purchase the adjacent parcel. Defendants refused to sell and plaintiffs commenced the instant action for, inter alia, specific performance. After a trial without a jury, Supreme Court held defendants' revocation of their offer to sell to be "without legal effect" and a judgment was entered ordering defendants to sell the adjacent parcel to plaintiffs. This appeal followed.
We reverse. Given the Court of Appeals' recent decision in LIN Broadcasting Corp. v. Metromedia, Inc., 74 N.Y.2d 54, 544 N.Y.S.2d 316, 542 N.E.2d 629, we cannot agree with Supreme Court that once defendants decided to sell, plaintiffs' right of first refusal ripened by operation of law into an irrevocable option to buy the parcel. Unlike an option, which creates a power to compel a sale, a first refusal right "contemplates a willing seller who desires to part with the property" (id., at 60, 544 N.Y.S.2d 316, 542 N.E.2d 629 [emphasis supplied]. Should the seller decide not to sell before the right of first refusal is exercised, "the selling party has fully complied with its obligations under the first refusal clause by not selling without first making the required offer" (id., at 62, 544 N.Y.S.2d 316, 542 N.E.2d 629). Thus,...
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