Court Opinion

ID: 7016682
Source: CourtListenerOpinion
Date Created: 2022-07-24 04:23:15.616552+00
Date Added: 2024-06-11T12:04:20.251712
License: Public Domain

Mr. JUSTICE BARRY, dissenting: I respectfully dissent from the majority opinion. Of particular significance in this case is the fact that the agreement, entitled “Option Agreement,” was written by the defendants-buyers’ attorney and that paragraph 8 provided, “Upon the exercise of the option, Seller [plaintiff] shall provide Buyer [defendants] with a merchantable Abstract showing merchantable title in Seller [plaintiff], subject only to the taxes for the year 1974.” (Emphasis added.) The evidence produced at trial indicated that defendants did not exercise the option to buy within the 10-day period. The defendants claim that they did not become aware of the standard Federal governmental overflow easement along this navigable waterway until after, they accepted the option. Regardless of the defendants’ contentions, the intention of the parties, as expressed in the writing memorializes their agreement, and is controlling in this case. The language is unambiguous. (John Gabel Manufacturing Co. v. Murphy (1945), 390 Ill. 455, 62 N.E.2d 401.) Under no stretch of the imagination can the option agreement entered into be read so as to instead constitute a binding contract for plaintiff to sell and defendants to buy Camp Archie Allen. To the contrary the plain and ordinary meaning of the language used establishes that the agreement was clearly an option to be exercised prior to the contract to buy and sell real property. The generally accepted definition of an option to purchase real property is that “it is a contract by which the owner of the property agrees with another person that the latter shall have the right to buy the property at a fixed price within a specified or reasonable time and upon agreed terms.” 91 C.J.S. Vendor and Purchaser §4 (1955). The option contract in the instant case consists of two separate parts. First the plaintiff for valuable consideration agreed to”Withhold the property from the market, and to leave open the offer to sell to defendants upon the stated terms for a 10-day period, which in itself did meet all the legal requirements of a binding contract. Secondly, it only contemplated the triggering of the later formation of a separate contract to buy and to sell the land if the condition precedent of exercising the option was met. The case of Christopher v. West (1951), 409 Ill. 131, 98 N.E.2d 722, cited by the defendants is distinguishable. That case involved an actual buy and sell agreement, not an option. In such a case the buyer is entitled to rescind the contract because the title is not merchantable or because the defect in title resulted in an impossibility on the part of the seller to perform. Obviously, here, the parties had not yet reached the stage of a binding contract to buy and to sell, and the merchantability of the title is not yet an issue. “It is admittedly a proposition of law that an option contract does not become a contract for the sale of property until the holder of the option has exercised the same in strict conformity with the conditions therein presented.” (Moehling v. Pierce (1954), 3 Ill. 2d 418, 423, 131 N.E.2d 735, 735.) In the instant case it should be here again emphasized that defendants’ scriviner wrote “upon the exercise of the option, Seller shall provide Buyer with a merchantable Abstract * * (Emphasis added.) No citations are necessary for the fundamental principal of contract law that a writing will be construed most strictly against the party drafting it. For the purposes here involved, the plaintiff has performed all of its part of the bargain. It left the offer to sell open for the 10-day period and in fact took the property off of the market to its detriment during the life of the option. For this the defendants agreed to pay *1,000. Paragraph 8 of the option agreement demanding an abstract showing merchantable title only became operative if defendants exercised their option. Although an option such as the one here can ripen into a binding contract to buy and to sell, it did not do so. No cases have been cited nor am I aware of any authority for requiring the optionor to furnish a marketable tide to the optionee prior to the exercise of the option. In fact it is not unusual for a seller to not own land which he agrees to convey and yet the seller has every right to enforce the contract against the purchaser. (See Ruddock v. American Medical Association (1953), 415 Ill. 63, 112 N.E.2d 107, and Heller v. McGuin (1914), 261 Ill. 588, 104 N.E. 158.) By the generally accepted definition of option and by the lack of express language of this contract the plaintiff was not required to go through the expense of furnishing evidence of merchantable tide until the inception of the contract to buy and sell. Only when the option is accepted and an election thereunder is made does the option become an executory contract for the sale of the property. While the majority characterizes the exercising of the option as a “useless act,” I characterize it as an essential act. The absence of prior case precedent itself suggests that the need to prove a merchantable title without an express agreement in an option contract should not be the rule. Without considering that a defect, if any, might be cured (by release or otherwise) after exercise of the option, the majority proceeds to assume the lack of merchantability of title, adversely to the plaintiff, in order to create the issue of impossibility of performance. Though defendants raise the issue of whether the easement in the case at bar is such an encumbrance that plaintiff’s title is not merchantable, I believe a determination of the nature and obligations of the option contract resolve the appeal, and that a remand is not necessary. Of significance is the fact that the plaintiff received another offer from a willing buyer during the life of defendants’ option (despite the majority’s reliance on lack of merchantability), and could not accept the offer because of the existence of the option. Further, from the agreed statement of facts, it also appears that after the expiration of the option agreement, the plaintiff did in fact enter into a contract for the sale of the subject premises for the same price offered by the defendants. If the majority view is correct, then the optionee in circumstances such as in the present case can test merchantability, contrary to the express language in the option to purchase, prior to the formation of the executory land sale contract, and thereby effectively beat down the seller in price or for other favorable contract terms. I do not believe that to have been the intent of the parties, nor should it be the direction of the law. I find the majority’s reliance on a theory of estoppel and waiver of the alleged defect speculative and without merit. I believe it should be noted that the defendants could have easily conditioned their exercising of the option upon the reservation of their objection to the easement, and in fact the uncontroverted and admitted evidence of the attempted recission because of the easement is probative of their reserving their objection to the title. The trial court correctly found in favor of plaintiff and against defendants, and entered judgment for *1,000 plus costs. I would affirm.