Opinion ID: 1139574
Heading Depth: 1
Heading Rank: 4

Heading: optionee

Text: The optionee, pursuant to his acquired right, clearly expects to realize any value in excess of the optioned price and often  as here  will expend considerable time and expense in furthering this expectation. [6] To deny the optionee participation in the condemnation award under such circumstances provides the optionor an inequitable and unjustifiable windfall. It strips the optionee of the expected benefit of his bargained right, while relieving the optionor of his bargained duty at a profit. (6) A paramount purpose of eminent domain law is to do substantial justice. ( United States v. Miller (1943) 317 U.S. 369, 375 [87 L.Ed. 336, 343, 63 S.Ct. 276, 147 A.L.R. 55].) Because considerations of fairness with respect to the competing interests of the optionor and optionee fall heavily in favor of compensating the optionee, denying compensation to the optionee would defeat this purpose. Finally, considerations of public policy dictate the optionee share in the condemnation award. Although the option has long been recognized in the marketplace, increased complexity and severity of land use laws and procedures have substantially enhanced the importance of its use. The option has become a prevalent method for securing to a potential land buyer the ability to ultimately purchase the land  while affording him the opportunity to undertake and complete the often expensive and lengthy process of determining whether his intended use of the land will be permitted. (Cal. Real Estate Sales Transactions (Cont.Ed.Bar 1967) § 7.1, p. 253.) Such efforts by the optionee frequently increase the value of the optioned property, although legal title remains in the optionor. Given this increased importance of the option in the marketplace, frustration of the process appears unwise.