Commuter Developments and Investments, Inc. v. Gramlich, 42061

• Decision Date: 29 May 1979
• Docket Number: No. 42061,42061
• Citation: 203 Neb. 569,279 N.W.2d 394
• Parties: COMMUTER DEVELOPMENTS AND INVESTMENTS, INC., Appellee, v. Leonard F. GRAMLICH and Laura Ann Gramlich, Appellants.
• Court: Nebraska Supreme Court

Page 394

279 N.W.2d 394

203 Neb. 569

COMMUTER DEVELOPMENTS AND INVESTMENTS, INC., Appellee, v. Leonard F. GRAMLICH and Laura Ann Gramlich, Appellants.

No. 42061.

Supreme Court of Nebraska.

May 29, 1979.

Syllabus by the Court

1. Evidence. A duplicate of a writing is admissible to the same extent as an original unless a genuine question is raised as to the authenticity of the original or in the circumstances it would be unfair to admit the duplicate in lieu of the original.

2. Contracts: Options. An option to purchase real estate is a unilateral contract by which the optionor agrees with the optionee that the optionee has the right to buy certain property according to the terms and conditions of the option.

3. Contracts: Options: Time. An option does not constitute an estate or interest in land but it is a mere right of election to accept or reject a present offer within the time and upon the terms designated.

4. Contracts: Options. A consideration for an agreement requires that there be a benefit on one side or a detriment suffered or a service done on the other.

Finlayson, McKie & Fisk and L. R. Brodkey, Omaha, for appellants.

Chris M. Arps, Papillion, for appellee.

Heard before KRIVOSHA, C. J., McCOWN, and WHITE, JJ., and KORTUM and FAHRNBRUCH, District Judges.

KORTUM, District Judge.

This is an action for the specific performance, or in the alternative, for damages, for breach of an option contract for the purchase of real estate. The District Court found for the plaintiff on the basis that a valid enforceable option existed and assessed damages against the defendants.

The plaintiff, Commuter Developments and Investments, Inc., is a corporation engaged in oil well promotion and land development. In 1965 the plaintiff purchased the land in question for $700 an acre. In 1971 the parties commenced a series of transactions involving the north 49 acres of the property.

On April 19, 1971, the plaintiff gave Leonard Gramlich, one of the defendants, a note for $10,000. Leonard, a real estate salesman, took a second mortgage on the property and also received a "firm Listing for sale" of the real estate.

On May 5, 1971, the plaintiff gave a second note to Leonard, this note being for $5,000. Chronologically the next matter of significance occurred on July 31, 1971. The president of the plaintiff corporation wrote a letter to the board of directors stating that he planned to sell the real estate with a 5-year repurchase option "as previously discussed."

On August 1, 1971, the defendants executed the option in question. Leonard then gave the plaintiff a check dated August 2, 1971, for $15,000 as part of the sales price. The plaintiff executed a quitclaim deed to a small portion of the property and on October 18, 1971, executed a corporation warranty deed to the balance of the land. The deeds were notarized on October 18, 1971, and filed on November 17, 1971. On November 23, 1971, Leonard paid plaintiff $2,283.83. Cancellation of two notes for $15,000 was part of the purchase price of the property.

On May 31, 1974, the defendants sold the land to third parties for $1,200 an acre. The plaintiff attempted to exercise the option on May 3, 1976, and upon defendants' refusal to honor the option, this litigation ensued.

The original option was not produced at trial. Plaintiff's witness testified that it was lost and he could not find it. A copy of the option was admitted by the trial court and, in addition, the trial judge admitted testimony as to the intent of the parties surrounding the transaction.

The defendants first contend the trial court erred in admitting the option into evidence. Defendants urge that no consideration existed for such option and that the one dollar consideration recited in the option was never paid. Under the general principles of contract law, the consideration for an option may consist of some benefit to the promisor, some loss to the promisee, or some money or other thing of value given, paid, or exchanged. 77 Am.Jur.2d, Vendor and Purchaser, § 35, pp. 215, 216. A consideration for an agreement to become a binding contract requires a benefit on one side or a detriment on the other. Grady v. Denbeck,197 Neb. 795, 251 N.W.2d 164 (1977); Adair v. Adair, 192 Neb. 571, 222 N.W.2d 908 (1974).

The consideration in this case is apparent. The terms of the option provided for a repurchase by the plaintiff at the original sales price plus a 10 percent raise in evaluation each year for the 5 years the option was to exist. In addition, the defendants received an additional $15,000 in oil interests which they still retain. The defendants collected the rents from the property and Leonard paid himself a commission upon the sale of the land from plaintiff.

The plaintiff benefited by getting out of debt, by cancellation of the outstanding notes to defendants, and by eliminating the second mortgage, but suffered a detriment of 10 percent appreciation to the value of the property each year. In addition the evidence is clear that the plaintiff would not have deeded the land in question to the defendants without the option.

The defendants further contend the trial court erred in admitting...