In re Estate of Rigby

• Court: Wyoming Supreme Court
• Writing for the Court: KIMBALL, Justice.
• Citation: In re Estate of Rigby, 62 Wyo. 401, 167 P.2d 964 (Wyo. 1946)
• Decision Date: 09 April 1946
• Docket Number: 2323
• Parties: IN THE MATTER OF THE ESTATE OF MASON RIGBY, DECEASED. v. L. H. ALGER, Administrator of the Estate of MASON RIGBY, DECEASED, AND JAMES L. McINTOSH and CLARENCE GRIEVE, Respondents WILLIAM P. McINTOSH, Appellant,

167 P.2d 964

62 Wyo. 401

IN THE MATTER OF THE ESTATE OF MASON RIGBY, DECEASED.

WILLIAM P. McINTOSH, Appellant, v. L. H. ALGER, Administrator of the Estate of MASON RIGBY, DECEASED, AND JAMES L. McINTOSH and CLARENCE GRIEVE, Respondents

No. 2323

Supreme Court of Wyoming

April 9, 1946

Appeal from District Court, Fremont County; C. D. Murane, Judge.

Proceeding in the matter of the estate of Mason Rigby, deceased, on the report filed by L. H. Alger, administrator of the estate of Mason Rigby, deceased, of public sale of decedent's realty and request for instructions as to rights of bidders. From an order directing sale of the realty to James L McIntosh and Clarence Grieve, William P. McIntosh appeals.

Order reversed in so far as it directs a sale of realty and cause remanded for further proceedings consistent with opinion.

Order reversed and case remanded.

For the appellant, the cause was submitted on the brief and oral argument of W. E. Hardin of Lander, Wyoming, and C. A Brimmer of Rawlins, Wyoming.

POINTS OF COUNSEL FOR APPELLANT

A contract for extension or renewal of a lease must specify the terms and conditions of the renewal or extension with such definiteness and certainty that the court may determine what has been agreed upon, and if it falls short of this requirement, it is not enforceable. 35 C. J. 1008, 1009.

The determination of the question whether a particular renewal option clause in a lease is to be construed as granting an absolute option to renew the lease, or an option conditional upon the desire or purpose of the lessor to relet the premises, depends largely upon the terms of such clause, with other provisions of the lease and attending circumstances also being determining factors in some instances. 32 A. J Sec. 971, Page 815.

A renewal clause must be supported by language clear and certain. It may be unenforceable on account of indefiniteness. A renewal clause is too indefinite to constitute a valid and enforceable covenant when it provides that the lease is to be extended, if both parties agree, or upon such terms as may be agreed upon. 3 Thompson on Real Property, Perm. Ed., Page 385.

In the majority of cases option clauses giving "first", or "prior" rights to re-lease have been held to be conditional upon the desire or purpose of the optionor. 127 A. L. R. 894.

Where a covenant reads "if the premises are for sale at any time, the lessee shall have the refusal of them", this is simply an agreement to give the lessee the first chance to make a contract, an agreement to sell, if the parties can agree, but not otherwise. It neither fixes the price, nor provides any way in which it can be fixed. Pray v Clark, 113 Mass. 283; Grace v. Denison, 114 Mass. 16; Geltson v. Sigmund, 27 Md. 334; Abeel v. Radcliff, 13 Johns 297. The contract does not contemplate a sale to somebody else as a mode of ascertaining the price at which the lessor will sell to the lessee. Fogg v. Price, 14 N.E. 741 (Mass.).

For the respondents, Grieve and James L. McIntosh, the cause was submitted upon the brief and oral argument of H. S. Harnsberger of Lander, Wyoming. Mr. George F. Dobler of Lander, Wyoming, appeared for the Administrator at the hearing.

POINTS OF COUNSEL FOR RESPONDENTS

The option is unenforcible if no price for the land is fixed, although it is sufficient that the price be fixed as not to exceed a designated amount or not less than a designated amount or at the amount offered by any other person or purchaser. Also it is sufficient if the instrument provides a method for subsequent determination of the price and if the price is determined according to the method provided, the contract is then as complete as if the price had originally been fixed therein. 35 C. J. 1040.

The enumeration of statutory grounds upon which a sale may be vacated excludes by implication the existence of any other grounds, except only non-payment or refusal or performance by the purchaser. 2 Bancroft's Probate Practice, Page 1124.

A purchaser of real property with notice of a prior contract to convey the same to another takes it subject to the equitable rights of the original contractor to a completion of his bargain and may be compelled in equity to perform the contract of his vendor; and upon a bill filed by the original vendee against the vendor, for such subsequent purchaser, the proper practice is to direct a specific performance of the contract by the subsequent purchaser in whom resides the legal title. Frank v. Stratford-Hancock, 13 Wyo. 36, 67 A. L. R. 571.

The method of determining the price is definite when the price is to be settled by the optionor's decision. R. F. Robinson Co. v. Drew, 83 N.H. 459, 144 A. 67.

KIMBALL, Justice. BLUME, Ch. J., and RINER, J., concur.

OPINION

KIMBALL, Justice.

The appeal is from an order entered in a probate proceeding for the sale of property by the administrator of the estate of Mason Rigby, deceased.

The lands in which Rigby was interested at the time of his death comprise 1601 acres, usually referred to as "deeded" or "patented" land, and about 1440 acres of state school land leased to Rigby by the state for the term ending March 1, 1949.

When Rigby died his interest in said lands was subject to a lease given May 13, 1941 by him as lessor to Clarence Grieve and James L. McIntosh, lessees, for the term ending May 1, 1946. This lease contains the following provisions wherein the lessor is called first party and the lessees second parties:

"As part of the consideration for entering into this lease and agreement first party hereby gives and grants to second parties the first right and privilege of again leasing all of the above described lands for another period of five (5) years, at the termination of this lease on such terms as first party shall at that time offer all of said lands for lease and as a further consideration the said first party hereby grants unto said second parties the right and option to purchase all of said above described lands of which first party is then the owner, on such terms as first party shall then demand for purchase price of said lands, it being understood second parties are to have the first right, option and privilege of purchasing said lands from said first party.

"It is understood and agreed between the parties hereto that first party shall have the right to sell the above described patented lands, subject to this lease. * * * *

"This agreement shall run to and be binding upon the heirs, executors and assigns of both parties hereto."

Rigby died intestate in May, 1944, and the administrator of his estate, who is not an heir, was appointed, and had the property appraised, during that month. The real property (1601 acres) owned by Rigby was appraised at $ 7.50 an acre, and this valuation (total $ 12,007.50) was intended to include the value of his interest under his lease of the state school lands. The personal property in the estate, except money, was of little value and the sale thereof under the order about to be mentioned is not questioned on the appeal.

On August 15, 1944, after proceedings had pursuant to section 88-3215, R. S. 1931, et seq., the court made an order authorizing the administrator to sell all the property of the estate at either public or private sale to pay debts and charges and expenses of administration, and "to make distribution to the heirs in money, since the said heirs reside in England and will be better satisfied to receive their shares in money". See sections 88-3220, 88-3221, R. S. 1931.

The order, after the description of the real property owned by Rigby, recites and declares that: "All of the above land is subject to a lease in favor of Clarence Grieve and James L. McIntosh, dated May 13, 1941, the term of said lease beginning May 13th, 1941 and ending May 1st, 1946, which lease also grants to said lessees, the first right option and privilege of purchasing said lands, and any sale must be made subject to the terms of the above described lease".

The administrator decided to sell at public sale, and published a notice that the property would be sold at public auction. At the time and place of sale, as stated in the notice, the administrator offered for sale "at public auction for cash to the highest bidder," all the real property of the estate and the lease of state lands, "subject to the lease and option to purchase the real estate as contained in that certain lease and agreement made and entered into May 13, 1941, by and between Mason Rigby, deceased, and Clarence Grieve and James L. McIntosh * * *," and announced that "bids would be received per acre on the patented land, containing 1601 acres, and that if accepted the said bid would carry the lease on state-owned lands held by said estate * * *".

The bidding was opened by James L. McIntosh, one of the lessees in the lease of May 13, 1941, who, for himself and the other lessee, bid $ 7.50 an acre for the 1601 acres, total $ 12,007.50. Mrs. Bessie A. McIntosh, acting for her husband, William P. McIntosh, who was not personally present, then bid $ 8 an acre, total $ 12,808.00.

"Thereupon", as recited by the administrator in his report of the proceedings, "the said bidders, Clarence Grieve and James L. McIntosh, claimed they were entitled to purchase the land for the sum bid by William P. McIntosh, since no other bids were offered and they desired to exercise their rights as contained in the Lease and Agreement, dated May 13th, 1941."

The administrator, by his attorney, then stated that "the matter of determining who was entitled to purchase the property was a matter to be decided by the Judge;" that the administrator would make a full and complete report of the proceedings had at the sale; request that a time be set for a...