Trear v. Chamberlain, 115,819

• Court: Court of Appeals of Kansas
• Citation: 388 P.3d 607
• Docket Number: No. 115,819,115,819
• Parties: Kevin W. Trear, Appellant/Cross-appellee, v. Susan J. Chamberlain, Nathan Goodell, and Jamie Jasnoski, Appellees/Cross-appellants.
• Decision Date: 13 January 2017

388 P.3d 607

Kevin W. Trear, Appellant/Cross-appellee,
v.
Susan J. Chamberlain, Nathan Goodell, and Jamie Jasnoski, Appellees/Cross-appellants.

No. 115,819

Court of Appeals of Kansas.

Opinion filed January 13, 2017

Stuart N. Symmonds and Robert N. Symmonds, of Symmonds & Symmonds, LLC, of Emporia, for appellant/cross-appellee.

Karen K. McIlvain, of McIlvain Law Office, LLC, of Madison, for appellees/cross-appellants.

Before Powell, P.J., Pierron and Hill, JJ.

388 P.3d 609

Hill, J.

The public policy in Kansas commands that land must not be tied up forever by ancient covenants. This policy is expressed in the common-law rule against perpetuities which nullifies any contractual provision that tries to control land forever. Aware of this, and wanting to avoid the harsh result of contract nullification, modern courts frequently interpret contracts to create personal interests in real estate that are unique to the contracting party. Such interests cannot be passed on to all future generations and, thus, cannot violate the rule against perpetuities. We interpret the right of refusal provision in the 1986 real estate contract between Kevin W. Trear and Leonard and Susan Chamberlain to be the personal right of Trear that cannot be passed on to anyone else.

Because the district court erroneously held that the rule against perpetuities nullified the right of refusal provision of the real estate contract, we reverse and remand for further proceedings. We do, however, hold that the district court properly ruled that the same contract did, in its "description of adjoining land," satisfy the statute of frauds. We affirm that portion of the district court's ruling.

We are in the same position as the district court.

Because there are no disputes about the facts, we are in the same position as the district court in ruling upon this motion for summary judgment. See Martin v. Naik , 297 Kan. 241, 246, 300 P.3d 625 (2013).

Trear bought some real estate from the Chamberlains in 1986 in Lyon County, Kansas. Trear was not represented by counsel and the Chamberlains' lawyer drafted the contract. The right of refusal provision that is at the heart of the controversy in this case states:

"6. The parties mutually agree that in the event the real estate presently owned by SELLERS [the Chamberlains] which is adjoining the real estate which is the subject of this Contract, is offered for sale by SELLERS, SELLERS shall extend unto PURCHASER [Trear] the first right of refusal to purchase said adjoining real estate at a price and upon terms mutually agreed upon by the parties. If the parties cannot agree, this right of first refusal shall lapse and thereafter be considered null and void."

In addition, the contract provided that it was "binding upon the heirs, legal representatives, and assigns of the parties hereto."

Leonard Chamberlain died in 2013. Later that year, Susan wanted to sell the adjoining real estate, subject to the right of refusal provision. Chamberlain's lawyer wrote a letter to Trear containing an offer by Chamberlain to sell the property for $289,000. The letter stated that if Trear did not reply by November 12, 2013, it would be assumed Trear did not want to purchase the real estate and Chamberlain's obligation under the right of refusal provision would be fulfilled.

The property Chamberlain wanted to sell was a 73–acre tract that included the house in which the Chamberlains had lived. Offering self-serving statements in her affidavit in support of summary judgment, Chamberlain's daughter, Jamie Jasnoski, stated two companies had appraised the property. One set the value at $299,000 and the other company said the property was valued at $275,000. However, neither company had a file on the appraisal. Trear neither accepted the offer nor made any counteroffer. After that, Chamberlain listed the real estate with Tri–County Realty, which advertised the property for sale at $295,000. Tri–County Realty was unable to sell the property for the listed price. Trear never made an offer to Tri–County Realty to purchase the property.

Shortly after she took the property off the market, Chamberlain sold a 64–acre tract which did not include the house, to Jasnoski and Nathan Goodell for $91,125—a price considerably lower than that offered to Trear. When he learned of the sale, Trear sued Chamberlain, Goodell, and Jasnoski to enforce his right of refusal and to transfer the property to him instead. Chamberlain, Goodell, and Jasnoski filed a motion for summary judgment.

In its summary judgment ruling, the district court found that the right of refusal provision, when read in combination with the

388 P.3d 610

binding clause at the end of the contract, violated the rule against perpetuities. The district court refrained from reforming the contract under the provision in K.S.A. 59–3405(b) permitting the court to make such modifications because there was no petition before the court asking to modify the contract. Trear asked the judge whether he would deny a petition if one was presented and the judge stated: "[a]t this point. I'll be glad to have direction from the court of appeal's [sic ] on this issue."

The court went on to hold that the right of refusal provision did not violate the statute of frauds because the meaning of "adjoining property" in the contract could be ascertained. Both parties appealed the summary judgment rulings.

Because this contract was created before Kansas adopted the Uniform Statutory Rule Against Perpetuities, it does not apply to the future interest created by the contract in this case. See K.S.A. 59–3405(a). Instead, the common-law rule against perpetuities does apply. That means any interest which does not vest within 21 years after the termination of a life in being is void. Barnhart v. McKinney , 235 Kan. 511, 516–17, 682 P.2d 112 (1984).

Four cases offer us guidance .

Our view of this case is guided by what appears to be the clear evolution of the Supreme Court's application of the rule against perpetuities. We begin with an older case that ruled a contract violated the rule. The next three cases, all more recent, held the contracts did not violate the rule. They demonstrate the court's growing reluctance to void contracts.

The first case, Henderson v. Bell , 103 Kan. 422, 173 P. 1124 (1918), found there was a violation of the rule against perpetuities. The offending provision in that contract stated

" ‘should first parties elect to sell the following 40 acres now occupied by them, to wit: The N.W. ¼ of the S.W. ¼ of Sec. 10–7–21, in Atchison county, Kan.-the second parties shall have the right to purchase said last-mentioned 40 at the agreed price of $65 an acre.

"It is further agreed that, if said parties elect to sell said S.W. ¼ of the S.W. ¼ of Sec. 10–7–21 at any time in the future, the first parties shall have the right to purchase same at the agreed price of $65 an acre, provided first parties will also buy the balance of the above-described land at the agreed price of $40 an acre.' " 103 Kan. at 423–24, 173 P. 1124.

Our Supreme Court expressly held that the language violated the rule against perpetuities because "the Buchanans and those holding under them, either as...