### No. 12816 

### INTHE SUPREME COURT OF THE STATE OF MONTANA 1975

PETER D, 

### KLEIN and DANA KLEIN, Plaintiffsand Respondent,

STEPHEN D, 

### BRODIE 

### and MARILYN G. BRODIE, 

### Defendants and Appellants.

Appeal from: District Court of theFourth Judicial District, Honorable Jack

### L. Green, Judge presiding. Counsel of Record: 

### ForAppellants

### : Garlington, Lohn and Robinson, Missoula, Montana Sherman V. 

### Lohn argued, Missoula, Montana For Respondent

### : Robert 

### L. Deschamps, CountyAttorney, argued,

Missoula, Montana



### - - 

### Submitted: April 

### 10, 1975 Decided: I#/; ?'flk. Jusrice John Zorlway 

### Harrison delivered the Opinion of the Court. This 

### is an appeal by defendants Stephen D. and Marilyn G. Brodie from an adverse judgment entered inthe district court, Missoula County, inan action for the breach of a preernptive right provision contained ina buy-sell agreement. Plaintiffs Peter D. and Dana Klein cross-appeal on the issue of the amount of damages awarded by the districtcourt. The relevant, undisputed facts are: On July 25, 1966, the parties entered into a buy-sell agreement whereby defendants agreed toconvey a parcel of land located in Swan Valley, Missoula County, for the consideration of $5,000. An approximate descriptlon of the land was contained inthe buy-sell agreement, but the 

### exact boundary was tohe determined by a survey. Paragraph 8 of

cne buy-sell agreement contained thisclause which 

### is the basis of the present litigation: "Buyers tonave firstrefusal on any additional tracts Sellermay offer." Pursuant tothe 

### termsof the agreement, a survey of the uroperty was effected and approximately 22.2 acres of land were conveyed. Thereupon, plaintiffs paid the purchase price and took possession. However, sometime inthe fall 1970, plaintiffs discovered that a 90 a.creparcel of land located south of their land had been sold by defendants to one Robert OIConner. Thereupon plaintiffs, through their attorney, served a demand upon defendants that they be given an opportunity toexercise theirpre-emptive right. Following defendants' refusal, an action was brought in specific performance, or inthe alternative, damages forbreach of the preemptive right provision. Trial without 

### a jury was held before Hon. Jack L. Green inthe districtcourt, Missoula County. Judgment was rendered in favor of plaintiffs and damages were assessed at$8,550. From thisjudgment defendants appeal and raise this issue:

### Is the pre-emptive right agreement unenforceable because the 'iiescriptionof the land to which it applies is incomplete and 

### ambiguous? Plaintiffs on their cross-appeal raise this issue: Did the district court correctly determine the amount of 

### damages for the breach of the pre-emptive agreement? We hold in the affirmative on defendants' issue. Accordingly, a consideration of plaintiffs' issue is unnecessary. In Weintz v. Bumgarner, 150Mont. 306, 313, 434 P.2d 712, this Court examined the nature of a pre-emptive right and distinguished it froman option with these words: "Thedistinctionbetween the two is well explained in Volume VI,American Law of Property,

### B 26.64 p. 507: 

### "'Apre-emption differsmaterially from an option. A11 option creates in the optionee a power to compel the owner of property to sell it at a stipulated price whether or not he be willing to part with ownership. A pre-emption does not give to the pre-emptioner the power to compel an unwilling owner to sell; itmerely requires the owner, when arid if he decides to sell, to offer the property first to the person entitled to the pre-emption, at the stipulated price. Upon receiving such an offer, the pre-emptioner may elect whether he will buy. If he elects not to buy, then the owner of the property may sell to anyone."' Property that is the subject of the pre-emptive agreement should 

### be 

### adequately described and the price must be stated or otherwise made determinable. 1A Corbin on Contracts, S 

### 261. In the instant case, the fact that no price was mentioned at which the pre-emptive rightwas to be exercised does not make the agreement void for uncertainty, since the use of the words "first refusal" is technical. Consequently, these words imply that the holder of the rightmay purchase at the sameprice offered by a third party when the agreement is silent as to price. See: Jurgensenv. Morris, 194App.Div. 92, 185 N.Y.S. 

### 386; Tamura v. ile~uliis, 203 Or. 619, 281 P.2d 469;Brenner v. Duncan, 318 Mich. 1, 

### 27 N.W.2d 320; Barling v. Horn, (Mo. 1956) 296 S.W.2d 94. Here,how eve^ cne sre-emptive rignt agreement 

### is fatallydefective because 

### it 

### is impossible todetermine the description of propertytowhich the right applies with accuracy, even though resort 

### is had toextrinsic evidence. InMercer v. Lemmens, 40 Cal.Rptr. 803, 230 C.A.2d 167, where the sufficiency of a description contained within a pre-emptive agreement was attacked by the defendant ina breach of contract action, the description referred to the "adjoining" 50 Eoot Lot. The California court upheld the agreement after extrinsic evidence disclosed the 

### seller owned no other real property adjoining or contiguous tothe tractowned by plaintiff and the coartwas able todetermine with accuracy the description of the parcel of property towhich the pre-emptive right applied. The facts inthe instant case are fardifferent and compel

a ~ifferent result. The record discloses the property purchased by plaintiffs was included within a larger parcel of land owned 

### by defendants. Defendants were the record owners of the Southwest and Sbutheast quarters of section 4, Township 20 North, Range 16 west. Plaintiffs' acquired land was located inthe Southeast quarter. Defendants alsoowned residential property in the jlissoula area aswell asproperty inthe Northeast quarter of 3ection 

### 5, Township 12North, Range 19West; property in Section 2, Township 12North, Range 19West; and property in Section 19, Yownship 15North, Range 7West. Thus, the rationale of Mercer is not applicable and the agreement must failbecause of 

### its 

## ;+cenr indefiniteness. Here, attempting toascertain the intent of the parties

d~ CLI~ time the contract was entered into, we look to statutes dealing with the interpretationof contracts. Section 13-709, 

### K.Z.M. 1947, requires interpretation of a contract in such a

manner astomake 

### it operative, if such can be done without violating the intent of the parties. Section 13-720, R.C.M. 1947,zouipels ir~cerpretac~osi af thecontractmost strongly against the party causing theuncertainty toexist, (here, the defendant). We arecognizant of the above rules, however, 

### we cannot ignore the plain implication of section 13-402, R.C.M. 1947, which states: "The object of the contract must be lawful when thecontract 

### ismade, and possible and ascertainable

### by the 

### time the.contract

### is tobe performed." (Emphasis supplied.) To the same effect, see Thrasher v. Schreiber, 77 Mont. 221, 250 P. 600. 

### 1Corbin on Contracts, 

### 5 95, p. 394, states: "A court cannot enforce 

### a contract unless 

### it can determine what it is. It is not enough that the parties think thatthey have made a contract; theymust have expressed their intentions ina manner that 

### iscapable of understanding. It 

### is not even enough that they have actuallyagreed, if their expressions when interpreted inthe light of accompanying factors and circumstances, are not such that the court can determine what the 

### termsof that agreement are. Vagueness of expression, indefiniteness and uncertainty asto any of the essential 

### termsof an agreement, have often been held toprevent the creation of an enforceable contract." Accordingly, thejudgment of the districtcourt 

### isreversed and this

Y

Justi 

### We concur: ,. 

# 1 /

Justices 

### \)