Tarrant v. Self
| Decision Date | 17 April 1979 |
| Docket Number | No. 1-578A117,1-578A117 |
| Citation | 387 N.E.2d 1349,180 Ind.App. 215 |
| Parties | R. V. TARRANT, Plaintiff-Appellant, v. Floyd E. SELF and Ethel J. Self, Defendants-Appellees. |
| Court | Indiana Appellate Court |
James W. Funk, Kimmell, Funk & Cummings, Vincennes, for plaintiff-appellant.
G. Daniel Kelley, Jr., Michael S. Pabian, Indianapolis, for defendants-appellees.
Plaintiff-appellant R. V. Tarrant appeals from a judgment in favor of defendants-appellees Floyd E. Self, who is now deceased, and Ethyl J. Self wherein the trial court held that a provision in Tarrant's lease, which gave him the option to purchase the land he was leasing from the Selfs after the first fifteen year leasing period, never became effective because this suit was filed before the first fifteen years of the lease had transpired and because, under a clause of the lease which gave Tarrant the right of first refusal, Tarrant refused to buy the leased premises at a price equal to that offered by a third party.
We affirm.
In 1959 Tarrant, a jobber for Phillips Petroleum Company and the owner of a company called Tarrant Oil Company, negotiated two contracts with the Selfs which concerned the leasing by Phillips and Tarrant respectively, of two adjoining pieces of property which were owned by the Selfs. The Phillips lease was a fifteen year lease which began on August 1, 1959 and expired on July 31, 1974. Under the lease Phillips was required to pay the Selfs $270.00 per month in rent. The lease also included the following provisions:
"12. Lessee shall have an option to purchase the leased premises and property, free and clear of all liens and encumbrances, at the end of the first Fifteen (15) years of the term hereof, for the sum of $25,000.00 and at any time during the next Five (5) years, and during the renewal period(s), for the sum of $25,000.00, provided that Lessee shall notify Lessor in writing of its intention to purchase at least thirty (30) days prior to the expiration of the period during which said option is to be exercised. In the event Lessee exercises this option Lessor shall furnish to Lessee for examination a complete abstract of title, certified to date, or title insurance policy at the option of Lessee, showing merchantable title to said premises in Lessor and a reasonable time shall be allowed for examination of title by Lessee and thereafter within a reasonable time Lessor shall correct the defects, if any, which Lessee found existing in said title. Lessor shall furnish such reasonable evidence of clear title to the leased personal property as Lessee may request. If title shall be approved by Lessee, Lessor shall execute and deliver unto Lessee a proper general warranty deed and bill of sale conveying and warranting to Lessee the premises and property free and clear of all liens, taxes and other encumbrances, upon payment to Lessor of the consideration above stated.
13. Lessee shall have an option to extend this lease for a term of Five (5) years from and after expiration of the primary term, and if such option is exercised, Lessee shall have the option of further extending it for an additional Five (5) years from and after expiration of the extended term, such extension or extensions to be upon the same terms and conditions as herein setforth. To exercise either of these options, the Lessee shall give the Lessor notice in writing at least thirty (30) days before the expiration of the primary term or the extended term, as the case may be. In the event this lease is extended hereunder, the rental shall be $275.00 per month for the first extended term and $275.00 per month for the second extended term, payable as hereinabove provided for the primary term. 'Primary term' and 'extended term' as used in this paragraph include any extension of either or both by virtue of Paragraph 10 above.
14. If the Lessor or the Lessor's successor or assigns at any time during the term of this lease or any renewal or extension thereof receive a bona fide offer to purchase or to lease the demised premises and property for a term to begin subsequent to the present demised term or any extension or renewal thereof, and Lessor desires to sell or lease said premises and property under the terms of said offer. Lessor agrees to give Lessee immediate notice in writing of such bona fide offer setting forth the name and address of the proposed purchaser or Lessee who had made the offer, with a full disclosure of all terms and provisions thereof. Lessee shall have the first option to purchase or lease the demised premises within thirty days after said notice on the same terms of any such proposal. In the event that Lessee does not elect to purchase the demised premises and property within that period, then Lessee shall have, upon the same conditions of notice, the continuing first option to purchase or to lease the said premises upon the terms of any subsequent bona fide offer or offers to purchase or to lease made to Lessor or a subsequent owner. Failure of Lessee to elect to purchase or to lease under this paragraph in any instance shall in no way limit or affect Lessee's rights under Paragraphs 10, 12 or 13 above and any sale or further leasing by Lessor, its successors or assigns to a third person shall in all respects be subject to this lease."
The Tarrant lease was also a fifteen year lease which began on August 1, 1959 and expired on July 31, 1974. Under his lease Tarrant was obligated to pay $75.00 per month in rent. Tarrant's lease also included the following provisions:
"10. Lessee shall have an option to purchase the herein leased premises and property free and clear of all liens and encumbrances, and adjoining property including a service Station located at 13th & Willow Streets and leased by Phillips Petroleum Company, After the first Fifteen (15) years of the term hereof, for the sum of $25,000.00, if Phillips Petroleum Company does not exercise its option to purchase said Service Station. In the event Phillips Petroleum does exercise said option, then Lessee shall have the right to purchase the leased property for One Dollar ($1.00). In the event Lessee exercises this option, Lessor shall furnish to Lessee for examination a complete abstract of title, certified to date, or title insurance policy at the option of Lessee, showing merchantable title to said premises in Lessor and a reasonable time shall be allowed for examination of title by Lessee and thereafter within a reasonable time Lessor shall correct the defects, if any, which Lessee found existing in said title. Lessor shall furnish such reasonable evidence of clear title to the leased personal property as Lessee may request. If title shall be approved by Lessee, Lessor shall execute and deliver unto Lessee a proper general warranty deed and bill of sale conveying and warranting to Lessee the premises and property free and clear of all liens, taxes and other encumbrances, upon payment to Lessor of the consideration above stated.
11. Lessee shall have an option to extend this lease for a term of 5 (five) years from and after expiration of the primary term, and if such option is exercised, Lessee shall have the option of further extending it for an additional five (5) years from and after expiration of the extended term, such extension or extensions to be upon the same terms and conditions as herein set forth. To execute either of these options, the Lessee shall give the Lessor notice in writing at least thirty (30) days before the expiration of the primary term or the extended term, as the case may be. In the event this lease is extended hereunder, the rental shall be $75.00 (Seventy Five Dollars)...
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