Opinion
No. 46/5.
07-01-1919
BURLEIGH v. MACTIER et al.
Louis Stern, of Atlantic City, for complainant. U. G. Styron, of Atlantic City, for defendants Mactier. D. D. Watkins, of Woodbury, for defendant Richman.
Bill by Margaret A. Burleigh against Henry Mactier and others. Decree for complainant.
Louis Stern, of Atlantic City, for complainant.
U. G. Styron, of Atlantic City, for defendants Mactier.
D. D. Watkins, of Woodbury, for defendant Richman.
LEAMING, V. C. In this suit complainant seeks specific performance of a covenant contained in a written lease held by her wherein her landlord bestowed upon her an option of purchase of the leased property. The covenant which complainant seeks to enforce is as follows:
"It is understood and agreed by and between the parties hereto that, in the event of the saidparty of the first part [owner] having a bona fide offer for the purchase of the abovemention-ed property during the continuance of this lease, the said party of the second part [tenant] has the first opportunity to purchase said premises for the sum of ninety-five hundred dollars."
During the term of the lease the owner of the property conveyed it to a third party. This suit is against the former owner and his grantee, as present owner, to enforce the covenant above quoted.
Although the covenant may be said to be unskillfully worded, its meaning is entirely clear and cannot be mistaken. By it' the owner of the property in effect agrees that, if during the term of the lease he should have a bona fide offer of purchase of the property, he would not accept the offer without first giving the tenant an opportunity to purchase the property for $9,500. The owner admittedly had such an offer. The tenant, in consequence, became entitled to be apprised of that fact, to the end that she might enjoy an opportunity to purchase at $9,500. Accordingly the single question here presented is whether such opportunity was given the tenant, since the owner could not rightfully accept the offer and make sale without first giving the tenant the opportunity to buy at the price named.
The rights of complainant, as against defendant Mactier, as purchaser, are clearly the same as against the covenantor. Complainant was in possession of the property under her lease at the time the sale was made, and the purchaser not only knew of complainant's possession, but his agreement of purchase specifically refers to the property as in the possession of a tenant, and at the settlement made preparatory to the delivery of the conveyance a copy of the lease was produced. These facts fully charged the purchaser with notice of the rights of the tenant appearing on the face of the written lease, and the testimony of Mr. Glinz strongly indicates that prior to the sale he personally informed the purchaser of the existence of the option of purchase enjoyed by the tenant.
It is claimed on the part of defendants that complainant was adequately apprised of the existence of a bona fide offer and was thereby given an opportunity to purchase; her failure to then exercise her option is urged in defense of this suit.
If complainant knew that a bona fide offer of purchase had been made and that her landlord desired to entertain the offer, it was clearly her duty to then exercise her option; failing in that, she could not now be permitted to do so, to the detriment of either the landlord or the purchaser. But it seems equally clear that no obligation on complainant's part to exercise her option can be said to have arisen during the term of her lease, unless and until she had been reasonably apprised of such offer having been made.
That she was not so apprised seems to me to be reasonably clear. Neither the owner of the property nor the real estate agent to whom complainant paid the rents for the owner notified her that an offer had been made, or that a sale was in any way contemplated, or that it was necessary that she should exercise her option. But one Glinz, who had found an opportunity to trade the property for a property in Philadelphia owned by defendant Mactier, claims to have informed two sisters of complainant, in the absence of complainant, that the property was about to be sold, and also claims to have been told by the two sisters of complainant that complainant did not want to purchase the property. While I am not inclined to doubt the accuracy of the testimony of Mr. Glinz, it yet incontestably appears that neither of complainant's sisters were clothed with authority to either exercise the option or to determine or to state that complainant did not wish to purchase, nor were either of the sisters of complainant in any way authorized to even receive notice of any proposed purchase, nor did Mr. Glinz even ask the sisters of complainant to apprise complainant of a proposed sale, and report to him or to any one else the purpose of complainant touching her option, nor had Mr. Glinz or the owner or proposed purchaser any adequate reason to assume that the sisters of complainant could represent her in any of these respects. The extent to which the conversations between Mr. Glinz and complainant's sisters was in fact afterwards communicated to complainant by her sisters is far from clear; but the testimony is convincing to my mind that it was not reasonably brought to complainant's comprehension that any offer of purchase had been made which the owner of the property desired to utilize to mature complainant's option. The spirit of the covenant is that complainant should enjoy her option of purchase during the full term of her lease, but that the owner should not during all of that time be denied the right to sell, if he received an offer; in the latter event the owner could require the option to be then either exercised or waived. In such circumstances complainant was clearly entitled to be apprised of the fact of an offer in such manner that she could reasonably understand that it was intended to put her upon her option. Mr. Glinz went to the house of complainant on his own initiative as an entire stranger, and without any message from the landlord, and conversed with complainant's sisters only. The utmost that he claims is that these sisters of complainant said to him that complainant did not want to purchase any more property. Mr. Glinz well knew that these sisters of complainant could not properly answer for complainant, and he never knew, until trial, that these sisters ever apprised complainant of any part of his conversation or of his visit. His aim was to make the trade at a profit to himself; he accordingly assumed theresponsibility of Informing the contemplated purchaser that complainant did not want to purchase. It seems clear to me that complainant, as owner of the option of purchase, was placed under no obligation to exercise her option by what was told her by her sisters, especially in view of the fact that the information bore no manner of appearance as having come from her landlord or his agent, or as being designed to require of her the exercise of her option. The purchaser appears to have relied upon Mr. Glinz's statement that complainant did not want to purchase; the owner appears to have been indifferent in the matter, but may have also relied upon Mr. Glinz's like statement. But I am convinced that complainant did not realize, and had no occasion to realize, that her landlord had called her option.
It is, indeed, difficult to escape the conviction that Mr. Glinz's conversations with the sisters of complainant lacked the necessary degree of fullness and frankness to adequately inform the sisters that an offer had been made of a nature to put complainant on her option. Had he clearly and frankly stated to them that an offer of purchase had been made, but could not be accepted by the owner unless complainant should, with knowledge of the offer, refuse to purchase, little doubt can be entertained that his message would have been promptly and adequately reported to complainant. But his personal interests were opposed to complainant making a purchase, and his own testimony touching his conversation with the sisters of complainant fails to disclose anything like a frank presentation of the situation in a manner to suggest to the "sisters the necessity of complainant then finally determining whether she would exercise her option. On the whole, I am fully convinced that complainant was at no time until shortly before the filing of the bill made aware that the precedent conditions named in the covenant contained in her lease had arisen.
I will accordingly advise a decree pursuant to the prayer of the bill.