Title: Cameron v. Double A Services

State: vermont

Issuer: Vermont Supreme Court

Document:

NOTICE:  This opinion is subject to motions for reargument under V.R.A.P. 40
as well as formal revision before publication in the Vermont Reports.
Readers are requested to notify the Reporter of Decisions, Vermont Supreme
Court, 111 State Street, Montpelier, Vermont 05602 of any errors in order
that corrections may be made before this opinion goes to press.


                          Nos. 89-404 and 89-528


Charles and Gwendolyn Cameron,               Supreme Court
et al.

     v.                                      On Appeal from
                                             Grand Isle Superior Court

Double A. Services, Inc.,                    December Term, 1990
Henry F. Richardson and
James E. and John J. Brooker


George T. Costes, J.

Jesse D. Bugbee of Kissane, Yarnell & Cronin, St. Albans, for plaintiffs-
  appellees

Keith J. Kasper of McNamara, Fitzpatrick & McCormick, Burlington, for
  defendants-appellants Double A. Services, Inc. and Richardson

Robert J. Perry of Perry & Schmucker, South Burlington, for defendants-
  appellants Brooker



PRESENT:  Allen, C.J., Gibson, Morse and Johnson, JJ. and Barney, C.J.
          (Ret.), Specially Assigned



     GIBSON, J.   In this declaratory judgment action, defendants Double A.
Services, Inc. and Henry Richardson, president and sole shareholder of
Double A. Services, Inc., appeal from a judgment that plaintiffs (the
Camerons) have the right, pursuant to their right of first refusal, to
purchase certain real estate that is the subject of a purchase and sale
agreement between Double A. Services and defendants James and John Brooker.
The Brookers, whose counter-claim and cross claim are still pending before
the trial court, have also filed briefs seeking reversal.  We affirm.
                                   I.
     In July of 1985, the Camerons sold a parcel known as Cam-Well Farm to
Double A. Services with the understanding, which was never reduced to
writing, that Double A. Services would attempt to keep the land in agri-
cultural use.  The transfer was financed through a mortgage held by the
Camerons and memorialized in a warranty deed, promissory note, mortgage
deed, mortgage agreement, and a document entitled "Option."  The mortgage
agreement required written notice to be provided to the Camerons before the
property could be conveyed or encumbered in any way.  The option granted
members of the Cameron family "a right of first refusal" to repurchase the
property, and provided in relevant part:
          The Cameron family or each of them will have thirty days
          from the date of notice of proposed sale in which to
          notify the Optionor of their desire to exercise this
          Option. . . .

          . . . .

          At the time that the Optionor receives a bona fide offer to
          acquire the premises, the Optionor will be deemed to
          offer the property to each Optionee under the identical
          terms offered by the third person.
     In the spring of 1987, Double A. Services entered into discussions with
James and John Brooker about a potential sale of the property.  On May 6,
1987, the Brookers and Double A. Services executed a purchase and sale
agreement, which included a document entitled "Addendum # 1" bearing the
same date.  Although the Camerons became aware of the negotiations, they
were given no written notice of the agreement until they received a letter,
dated May 20, 1987, from Double A. Services indicating that a purchase and
sale agreement had been signed.  The letter provided no details.  Through
their attorney, the Camerons obtained a copy of the agreement, including
addendum one, on June 21, 1987.
     Three days later, a second addendum dated June 24, 1987 was delivered
to the Camerons.  It provided in pertinent part:
          1) Seller has the right to plant and harvest grass crops
          on the property from January 1, 1988 until Purchasers
          sell each lot to new owners for residential building
          purposes.  Unless otherwise agreed to by the Purchasers,
          the Seller shall cease use of each lot upon its sale by
          Purchasers, and Seller recognizes that he may lose crops
          as a result of the termination period.

          . . . .

          4) Prior to July 24, 1988, Seller may remove all
          personal property from the barns including plumbing,
          electrical, tanks, drinking bowls, gutter cleaners,
          stanchions, and any other mechanical apparatus as long
          as the structures (barns) remain.
The trial court found that, if the Camerons exercised their right of first
refusal, addendum two would, as a practical matter, prevent them from
farming the property or using it for any purpose but residential develop-
ment; further, it would allow Double A. Services to harvest grass crops in
perpetuity if the property were not developed residentially.  The Brookers,
who were agreeable to addendum two, planned to develop the property.
     In early July 1987, the Camerons notified Double A. Services that they
intended to exercise their right of first refusal, but noted that the con-
ditions and effect of various addenda needed to be ironed out.  A closing
date, initially set for July 28, 1987, was continued to August 19, 1987.
Resolving the details, however, proved to be insurmountable; the Camerons
refused to accept the terms included in addendum two and Double A. Services
insisted upon including those terms.  The Camerons did not go to the
closing, choosing instead to file this action on August 17, 1987.  The trial
court declared that addendum two was not binding on the Camerons and that
they have the right to purchase the property under the terms of the purchase
and sale agreement and addendum one.
     On appeal, defendants make numerous arguments, which may be
consolidated into the following contentions: (1) addendum two is binding
upon the Camerons; (2) the Camerons waived their right of first refusal by
failure to accept the offer and tender performance; (3) the trial court
committed reversible error by referring to the right of first refusal as an
option; and (4) admission of Mr. Cameron's testimony about pre-sale dis-
cussions with Double A. Services regarding future uses of the property
constitutes reversible error. (FN1)
                                   II.
     It is undisputed that the right of first refusal gives the Camerons
the power to accept the offer of sale on "the identical terms offered by the
third person," the Brookers.  At trial, the parties disagreed, however,
about whether addendum two was a part of the original purchase and sale
agreement.  The trial court found that addendum two was intended to modify
the agreement, concluding that addendum two was an attempt by Double A.
Services to withdraw the original offer after it had ripened into an irre-
vocable option in favor of the Camerons.  On appeal, defendants contend
that the court was clearly erroneous in its finding and conclusion.
     Findings made by a trial court will not be set aside unless, taking the
evidence in the light most favorable to the prevailing party, and excluding
the effect of modifying evidence, they are clearly erroneous.  Bruntaeger v.
Zeller, 147 Vt. 247, 250,