Glick v. Chocorua Forestlands Ltd. P'ship

• Decision Date: 16 May 2008
• Docket Number: No. 2007–037.,2007–037.
• Citation: 157 N.H. 240,949 A.2d 693
• Court: New Hampshire Supreme Court
• Parties: Michael J. GLICK, D.D.S. v. CHOCORUA FORESTLANDS LIMITED PARTNERSHIP.

157 N.H. 240

949 A.2d 693

Michael J. GLICK, D.D.S.

v.CHOCORUA FORESTLANDS LIMITED PARTNERSHIP.

No. 2007–037.

Supreme Court of New Hampshire.

Argued: Jan. 16, 2008.

Opinion Issued: May 16, 2008.

As Modified on Denial of Rehearing June 25, 2008.

Douglas, Leonard & Garvey, P.C., of Concord (Charles G. Douglas, III and Benjamin T. King, on the brief, and Mr. Douglas orally), for the petitioner.

Hinckley, Allen & Snyder, LLP, of Concord (Christopher H.M. Carter and Daniel M. Deschenes, on the brief, and Mr. Carter orally), for the respondent.

DUGGAN, J.

The petitioner, Michael J. Glick, D.D.S., appeals an order of the Superior Court (O'Neill, J.) denying his petition for specific performance of a right of first refusal he holds for land owned by the respondent, Chocorua Forestlands Limited Partnership (Chocorua). Chocorua cross-appeals, arguing that the trial court erred in finding that Glick possesses valid first refusal rights. We reverse in part, affirm in part, and remand.

The trial court found the following facts: In March 1974, Glick purchased a tract of land that straddles the Ossipee and Moultonborough town line.

That property is abutted by Masonian lots 122 and 129 in the town of Ossipee, and Masonian lots 10 and 11 in the town of Moultonborough (Masonian lots). These lots are part of a much larger tract owned by Chocorua.

From 1983 through 1986, Glick and Chocorua engaged in negotiations regarding, among other things, Glick's desire to obtain rights of first refusal over the Masonian lots and Chocorua's desire to obtain certain rights of way across Glick's property. These discussions culminated in an agreement, on June 26, 1986, between Glick, his former wife, Victoria, and Chocorua (the Agreement). Victoria's interests in this matter were subsequently transferred to Glick during their divorce.

In the Agreement, Chocorua agreed to: (1) convey to Glick its right, title and interest in all rights of way allegedly burdening the Glick property within five days of the date of the Agreement; (2) convey to Glick approximately thirteen acres in Ossipee and Moultonborough that abutted the Glick property; (3) split all costs incurred for survey work associated with the Agreement; and (4) make "reasonable efforts to construct a stone and/or earthen barricade at the easterly end of" a road located near the parties' property. In addition, Chocorua agreed to, at "closing," "deliver to the Glicks rights-of-first refusal over the" Masonian lots. Those first refusal rights were to contain, among others, the following three terms:

(a) [Chocorua] or its successors and assigns shall, within fourteen (14) days of executing a purchase and sale agreement with a bona fide purchaser with respect to all or any portion of the encumbered Lots, send to the Glicks by certified mail, return receipt requested, a copy of the purchase and sale agreement.

(b) The Glicks shall have thirty (30) days from receipt of said notice to exercise their rights-of-first refusal by tendering to [Chocorua] the proposed purchase price by cashiers or certified check. In the event of such a tender, closing shall be held at the same time as called for in the purchase and sale agreement.... In the event such a tender is not made within the time specified herein or in the event of a failure by [the] Glicks to close as provided herein, the rights-of-first refusal shall terminate as to that portion of the encumbered lots in question.

(c) In the event of termination of the rights-of-first refusal with respect to all or a portion of the Lots as provided hereinabove, [Chocorua] or its successor in interest where applicable may but shall not be required to ... record in the Carroll County Registry of Deeds an affidavit setting forth a description of the Lots affected, and a statement that a copy of the affidavit was mailed to the Glicks by certified mail return receipt requested fifteen (15) days prior to the recording of the affidavit at the Carroll Country [sic ] Registry of Deeds and that no objection by the Glicks was received by [Chocorua] or its successor in interest prior to recording of the affidavit.

In the Agreement, Glick agreed to: (1) convey to Chocorua two rights of way over his property; (2) convey to Chocorua a specified acre of land that would facilitate Chocorua's access to its property; and (3) pay Chocorua $6,100 for the thirteen acres. Although the Agreement provided that subsequent conveyances would be made, it also dictated that "all obligations and rights under this [A]greement shall survive the delivery of the deeds contemplated in this Agreement."

The deeds contemplated by the parties in the Agreement were recorded on September 3, 1986, and Glick transferred $6,100 to Chocorua approximately one month later. But the "closing" referenced in the right of first refusal provision never occurred, and no further documents regarding those rights were created. Instead, on October 16, 1986, the Agreement itself was recorded in the Carroll County Registry of Deeds.

The testimony offered at trial regarding the recording of the Agreement varied. According to Glick's attorney at the time, Edward E. Lawson, he and Chocorua's attorney, David W. Rayment, agreed that the Agreement adequately defined the rights of first refusal and, thus, that there was no need to prepare the additional document originally contemplated by the parties. Lawson testified that Rayment concurred that recording the Agreement itself would be sufficient to place third parties on record notice of Glick's first refusal rights. In support of Lawson's testimony, Glick submitted a letter he received several months after the Agreement was recorded in which Lawson states that Rayment had "agreed that recording the [A]greement was sufficient ... [and that t]he right of first refusal is on the record and in effect."

Rayment, in contrast, could not recall having any conversation with Lawson regarding the recording of the Agreement. Moreover, he asserted that he never would have agreed to record the Agreement because it lacked "essential terms"—such as a provision granting Chocorua access to its remaining land in the event of the sale of the Masonian lots—and contained provisions he did not want disclosed to the public. According to Rayment, the parties had agreed that Lawson would draft the separate first refusal document, but they had "simply forgotten" about the issue.

Following the recording of the Agreement, there were no further communications between the parties regarding the rights of first refusal until November 4, 1998. At that time, Glick received a letter from Chocorua's then counsel, Robert Lloyd, informing him that Chocorua had entered into a purchase and sale agreement (P & S Agreement) with F. Colin Cabot and FCC Acquisition Co. (Cabot) for "all of the land that is subject to an apparent right to first refusal granted to [Glick] and the former Mrs. Glick by Chocorua." Lloyd stated that "[u]nder the terms of the right of first refusal [Glick] ha[d] thirty (30) days from the receipt of th[e letter] to exercise [his] rights of first refusal by tendering to [Chocorua] the proposed purchase price" of $375,000. Attached to the letter was a copy of the P & S Agreement, which similarly acknowledged Glick's first refusal rights. The record indicates that the sale of the Masonian lots was part of a much larger multi-million dollar sale of essentially all of Chocorua's assets to Cabot.

Following Glick's receipt of notice of the P & S Agreement, the parties' lawyers exchanged several communications regarding Glick's belief that: (1) the purported purchase price was excessive; (2) the thirty-day period originally prescribed by the Agreement should be extended in recognition of the fact that subdivision approval would be required for the sale of the lots; and (3) he should be permitted to exercise his rights of first refusal over only a portion of the Masonian lots. These communications continued until November 25, 1998, when Lloyd sent Glick and Lawson a fax, advising them that the Agreement had been "cancelled and terminated" and that "any right of first refusal [Glick] may have is" no longer exercisable.

That same day, Cabot's counsel, Howard G. Seitz, sent a fax to Lloyd confirming a conversation which they had that morning. In that fax, Seitz acknowledged that Cabot had cancelled the P & S Agreement, but noted they had "agreed to review the transaction pursuant to which [Cabot was] to acquire the Chocorua lands subject to equitable adjustment for the so-called ‘Glick Property’ with the thought, amongst others, that, if appropriate, [Cabot] might acquire the partnership interests of Chocorua['s] partners rather than the property itself."

At trial, Lawson testified that, immediately prior to receiving notification that the P & S Agreement had been cancelled, he spoke with Lloyd and informed him that Glick intended to exercise his first refusal rights. Glick also testified that several days prior to receiving Lloyd's fax, he spoke with Seitz and informed him of the same. However, the trial court found that "no documentation or communication was exchanged between respective counsel or the parties that indicated that Glick was unconditionally accepting the terms of the P & S Agreement prior to Glick's notification of its cancellation."

In February 1999, roughly two months after terminating the P & S Agreement, the general and limited partners of Chocorua sold their partnership interests, including their interest in the Masonian lots, to Cabot. In response, Glick filed the present action, arguing that his first refusal rights entitle him "to a decree of specific performance, compelling the defendant to sell him the ... [Masonian lots], at [their] fair market value." Chocorua objected, claiming that Glick did not have first refusal rights because the separate document referenced in the Agreement was never executed. Moreover, Chocorua argued that even if Glick had such rights, they would not have been...