Court Opinion

ID: 9547793
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:52:31.286138+00
Date Added: 2024-06-11T15:18:06.487525
License: Public Domain

Fontbon, J.,
dissenting in part: My only disagreement with the majority view is that it denies to Lillian Maguire McNutt the right to exercise any part of the option. Her father’s intention was clear, I believe, that she and her sister Nellie were to share equally whatever benefits might accrue from the option accorded them. In common fairness, I see no good reason to deny Mrs. McNutt the fruits of her father’s beneficence merely because of her sad misfortune in losing her sister.
Concededly, the law has rarely touched this area in published form, so far as I am able to ascertain. However, language found in Lantis v. Cook, 342 Mich. 347, 69 N. W. 2d 849, cited in the court’s opinion on another point, appears to be relevant. The *693option involved in that case was one reserved by a husband and wife to repurchase their home should certain contingencies arise. In the course of its opinion the court said on page 354:
“Application of the common-law rule against perpetuities would leave the option intact because it was not exercisable beyond lives in being and 21 years, but was intended to and could be exercised only by and, hence, during the lives of the 2 optionees or the survivor of them. . . .” (Emphasis supplied.)
Pratt v. Prouty, 104 Iowa 419, 73 N. W. 1035, also mentioned by the court, is not, from my personal view point, a satisfactory precedent. The option in that case was for the purchase of certain shares of stock in a small corporation, given by one of the four stockholders to the other three. In giving the option, the grantor agreed to deliver the stock “in the number of shares to each as they may agree on.” One of the three optionees, without obtaining consent of the others, sought to exercise the option alone. The Iowa court refused to countenance such action, holding that consent of the other optionees was required. Under the facts of that case the court was eminently correct, but the factual situation here is quite different.
Neither do I find too close an analogy between options and powers, so far as their joint exercise is concerned. In creating a power of appointment the grantor endows the grantee with the exercise of discretion in carrying out his mission. Consequently, in appointing two or more grantees, the donor places reliance on the discretion and trustworthiness of both to fulfill the terms of the appointment. The same, I believe, is not so true in the case of options.
Regardless of what might have been the correlative rights and duties of the two optionees had both been alive at the death of the last life tenant, I see no legal or practical impediment to Mrs. McNutt’s exercising the option as to a one-half interest in the farm, as intended by her father, upon payment to Mrs. Scarbrough of one-half the option price. Although the option was extended to both Mrs. Green (Idol) and Mrs. McNutt, I think it susceptible of being exercised individually, under the circumstances shown here, and to the extent indicated.
For such reason, I respectfully dissent.
Kaul, J., joins in the foregoing dissent.