SUPREME COURT OF THE STATE OF NEW YORK

Appellate Division, Fourth Judicial Department

915 

CA 13-00228 

PRESENT: SMITH, J.P., CARNI, SCONIERS, AND VALENTINO, JJ.

 

 

CATHY TUMINNO, PLAINTIFF-RESPONDENT, 

V MEMORANDUM AND ORDER

MARJORIE WAITE, DEFENDANT-APPELLANT-RESPONDENT, 

JAMES FLAGELLA, DEFENDANT-RESPONDENT-APPELLANT, 

ET AL., DEFENDANTS. 

 

ERICKSON WEBB SCOLTON & HAJDU, LAKEWOOD (PAUL V. WEBB, JR., OF

COUNSEL), FOR DEFENDANT-APPELLANT-RESPONDENT. 

JAMES FLAGELLA, DEFENDANT-RESPONDENT-APPELLANT PRO SE.

GROSS, SHUMAN, BRIZDLE & GILFILLAN, P.C., BUFFALO (LESLIE MARK

GREENBAUM OF COUNSEL), FOR PLAINTIFF-RESPONDENT.

 

Appeal and cross appeal from an order of the Supreme Court,

Chautauqua County (James H. Dillon, J.), entered April 25, 2012. The

order directed a sale of real property under certain circumstances. 

It is hereby ORDERED that the order so appealed from is

unanimously vacated on the law without costs and the matter is

remitted to Supreme Court, Chautauqua County, for further proceedings

in accordance with the following Memorandum: In this action seeking,

inter alia, the partition and sale of real property and a

determination that the sale of the property extinguishes a certain

“option to purchase,” defendant Marjorie Waite appeals and defendant

James Flagella cross-appeals from an order that directed the sale of

the property in the event that Flagella and the remaining defendants

did not exercise their “option to purchase” the property within 60

days of entry of the order. 

Plaintiff and Waite are tenants in common and acquired the

property at issue by an executor’s deed pursuant to the settlement of

their mother’s estate. In settling that estate, plaintiff, Waite and

the other named defendants signed a settlement agreement providing

that plaintiff and Waite “agree to grant to [each of the other named

defendants] the option to purchase the . . . property, in the event

that [plaintiff and Waite], either jointly or severally, determine to

sell, assign or transfer the . . . property to someone other than each

other. The option price shall be [$120,000] plus the costs of any

improvements made by [plaintiff and Waite] to the premises subsequent

to [their] purchase of the premises. Said option may be prepared in

recordable form by any or all of the [other named defendants] at their
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CA 13-00228 

own cost and expense, and [plaintiff and Waite] will execute any said

recordable option. Upon receipt of an offer to purchase the premises,

except from [each other], [plaintiff and Waite] shall notify each of

the [other named defendants] then living, in writing of the proposed

sale of the premises, and the [other named defendants] shall have

sixty (60) days to exercise their option as granted herein.” 

The settlement agreement thereafter was reduced to a document

executed by plaintiff and Waite (hereafter, recorded document), and it

provided that “[w]e give and grant to [each of the other named

defendants] the option to purchase certain real property . . . The

option price for the property will be [$80,000] plus any improvements

made by . . . Waite and [plaintiff]. If at any time . . . Waite and

[plaintiff] desire to sell the premises and receive an offer they

shall communicate said offer to [each of the other named defendants,]

who shall then have sixty (60) days to purchase the premises upon the

same terms and conditions as the other offer.”

We conclude that the right bestowed by the settlement agreement

and the recorded document is a right of first refusal, not an option

to purchase, despite the use of the term “option” therein (see LIN

Broadcasting Corp. v Metromedia, Inc., 74 NY2d 54, 60; Metropolitan

Transp. Auth. v Bruken Realty Corp., 67 NY2d 156, 163), and thus that

Supreme Court mistakenly treated the contractual right as an option to

purchase. “A right of first refusal is a dormant right that is

triggered when an owner decides to sell the property to a third party

at an agreed-upon price” (Markan Corp. v Plane’s Cayuga Vineyard,

Inc., 24 AD3d 1264, 1265), and those are the applicable facts set

forth in the settlement agreement.

We agree with Waite on her appeal that the court erred in

determining that the contractual right was triggered upon plaintiff’s

commencement of the instant action, for partition and sale. It must

first be determined in a partition action whether the property may be

partitioned, i.e., divided among the owners in some fashion, without

great prejudice to them, and “partition sale” is a secondary

consideration only in the event that partition greatly prejudices the

owners (see RPAPL 901 [1]; Bentley v Dox, 12 AD3d 1187, 1187; Grossman

v Baker, 182 AD2d 1119, 1119). Thus, commencement of the partition

action did not trigger the right of first refusal inasmuch as a

partition, as opposed to a partition sale, would not result in a

transfer of the property to a third party. Furthermore, no offer of

purchase from a third party triggered either the right of first

refusal or the contractual obligation of plaintiff or Waite pursuant

to the settlement agreement or recorded document.

We further agree with Waite that, under the circumstances of this

case, the court erred in ordering the sale of the property without

first resolving the accounting issues and adjusting any equities (see

Colley v Romas, 50 AD3d 1338, 1340; Sampson v Delaney, 34 AD3d 349,

349), thereby “ensur[ing] that the parties’ rights are fixed in such

manner that a decree ‘may work full and complete justice between

[them]’ ” (Grossman v Baker, 182 AD2d 1119, 1119).
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CA 13-00228 

Moreover, in some circumstances the right to partition pursuant

to RPAPL 901 (1) must yield to the well-recognized exception that

“equity will not award partition to a party in violation of his [or

her] own agreement” (McNally v McNally, 129 AD2d 686, 687; see Chew v

Sheldon, 214 NY 344, 348-349). “[W]here an action for partition would

tend to defeat the performance of a contract,” an agreement not to

partition is implied (24 NY Jur 2d, Cotenancy and Partition § 130; see

Tramontano v Catalano, 23 AD2d 894, 894; see generally Bessen v Glatt,

170 AD2d 924, 925). Here, partition that results in plaintiff and

Waite each having a portion of the property defeats the right of first

refusal, which applies to the entire property. Thus, partition

appears to be unavailable as a remedy (see McNally, 129 AD2d at 687),

unless the equities are adjusted such that either plaintiff or Waite

receives the entire property and the other is awarded owelty as

compensation for the unequal division of the property (see RPAPL 943;

24 NY Jur 2d, Cotenancy and Partition § 116), if equity so requires

given the claims of expenses and waste and the condition of the

property. We therefore vacate the order and remit the matter to

Supreme Court for an accounting and an adjustment of the equities

between plaintiff and Waite in a manner consistent with our decision

herein, prior to the entry of an order granting partition of the

property. We note that, upon remittal, the court may appoint a

referee.

On his cross appeal, Flagella contends that the court erred in

determining that the purchase price was $120,000 without allowing

further proof on the issue. Inasmuch as the record establishes that

plaintiff and Waite relied on the recorded document signed only by

them as opposed to the settlement agreement, which was signed by all

of the parties, we conclude that plaintiff and Waite thereby reduced

the purchase price of $120,000 in the settlement agreement to $80,000

in the recorded document. The reduced purchase price in the recorded

document is an enforceable term against plaintiff and Waite (see

generally United States Fid. & Guar. Co. v Delmar Dev. Partners, LLC,

14 AD3d 836, 838). 

Entered: October 4, 2013 Frances E. Cafarell

Clerk of the Court