Theobald v. Chumley

408 N.E.2d 603, 77 Ind. Dec. 668, 1980 Ind. App. LEXIS 1608
CourtIndiana Court of Appeals
DecidedAugust 19, 1980
Docket1-280A47
StatusPublished
Cited by7 cases

This text of 408 N.E.2d 603 (Theobald v. Chumley) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Theobald v. Chumley, 408 N.E.2d 603, 77 Ind. Dec. 668, 1980 Ind. App. LEXIS 1608 (Ind. Ct. App. 1980).

Opinion

ROBERTSON, Presiding Judge.

Frederick and Julia F. Theobald (Theo-bald) appeal the decision of the trial court which granted specific performance of a real estate option contract to the Estate of Ruth W. Buskirk. We affirm.

The somewhat convoluted facts reveal that Theobald entered into a real estate option agreement in November, 1972, with Kathryn Compton and Ruth Buskirk. Bus-kirk later acquired the interest of Compton. The option, given by Compton and Buskirk, provided that Theobald would receive approximately six (6) acres and cash, and in exchange, Theobald would convey 20.96 acres to Ruth Buskirk. The option contained the conditions that it was to expire after ninety (90) days; that Buskirk would pay $300.00 per acre for the additional land she would receive after the equal amounts were conveyed between the parties; and that Theobald would bear the expense of a legal survey to obtain the proper legal descriptions of the property to be conveyed.

Theobald had the legal survey prepared in January, 1973, at which time he told one Mary Ellen Chumley that he was exercising the option. Mary Ellen Chumley was the attorney-in-fact for Ruth Buskirk. Theo-bald also informed Chumley’s attorney that the option was being exercised. According to the agreement, the option could be exercised either in person or in writing.

The survey that Theobald had prepared called for a conveyance of approximately two (2) to three (3) more acres than was provided for in the option agreement. The warranty deed drawn up by Theobald’s attorney also reflected this increase. The deed was apparently never delivered, but was left with Mrs. Chumley’s attorney with instructions to attempt to resolve the difference in acreage. The difference was never resolved, and Theobald filed suit on August 21, 1974, for crops that were removed from the 20.96 acres which was farmed that year by the optionors. The complaint was amended on October 31, 1975, to add additional parties. Defendants answered and included various motions to dismiss and a cross-claim for specific performance of the option contract.

Trial was before the court, which made findings of fact and conclusions of law. The trial court ordered that Theobald take nothing by way of the complaint, and that the Estate of Ruth W. Buskirk was entitled to specific performance of the option contract.

The sole issue on appeal, as stated by Theobald, is whether the trial court erred in concluding that the real estate option agreement of November, 1972, was effectively exercised.

*605 We first note that when findings of fact and conclusions of law are submitted by the trial court, the court on appeal shall not set aside the judgment unless it is clearly erroneous. Ind.Rules of Procedure, Trial Rule 52; Lawrence v. Ball State University Bd., (1980) Ind.App., 400 N.E.2d 179; Indiana Motorcycle Assn. v. Hudson, (1980) Ind. App., 399 N.E.2d 775.

The essence of Theobald’s argument is that because the alleged exercise of the option did not conform in every respect to the option agreed upon, there was no effective exercise, and therefore, the option lapsed after the ninety day period expired. Theobald asserts that there can be no effective exercise of the option unless it meets and corresponds with the offer in every respect, meeting on all points. See Gerardot v. Emenhiser, (1977) Ind.App., 363 N.E.2d 1072. It is generally agreed that the optionor only subjects himself to liability to convey the property if the option is exercised within the time and in the manner stipulated. Bandy v. Myers, (1967) 141 Ind.App. 220, 227 N.E.2d 183 and cases cited therein; 25 I.L.E. Sales of Realty § 2 (1960); Coons v. Baird, (1970) 148 Ind.App. 250, 265 N.E.2d 727.

Although these cases are instructive on the exercise of an option, by the optionee, they are not determinative in this instance. Gerardot, supra, dealt with the payment of a broker’s commission before there was any contract. The court there determined that the broker could not recover since there was no contract in existence at the time and since sellers response was not identical to his offer. In Bandy, supra, and Coons, supra, it was the optionee who was attempting to enforce the option. Here, it is the optionor who wants specific performance of the bargain.

There are basically two steps necessary to exercise an option to purchase. First, the decision to purchase must be made by the optionee under the terms of the option, and second, the decision must be communicated to the optionor within the life of the option. Doolittle v. Fruehauf Corp., (1976) Fla.App., 332 So.2d 107. The reason why courts are strict in requiring an option to be exercised specifically as to its terms and within the specified time, is because of the power that the optionee exercises over the eventual formulation of a contract. Consequently, since the optionee is the sole party capable of consummating the option, courts require strict adherence to the option’s terms, when the optionee is attempting to enforce the option. Thus, the requirement that it meet and correspond with the option in accordance with the option’s terms. See Gerardot, supra; J. R. Stone Co., Inc. v. Keate, (1978) Utah, 576 P.2d 1285 (optionee giving less than required by option amounts to only a counter offer, which the optionor can either accept or reject.)

The facts of this case, however, present a different situation. In most cases where specific performance is sought, it is the optionee who is attempting to specifically enforce an option in which the optionee’s response either seeks more or gives less than that agreed in the option itself. Such is not the case here. In this case, the optionor is attempting to enforce the specific bargain agreed to in the option contract. Upon the communication by Theobald that the option would be exercised, the optionors acquired an expectancy interest that the option, as agreed to, would be exercised. By his communication, which was as provided'for in the agreement, Theobald accepted the offer. At that time the contract was enforceable. The legal survey that Theobald was required to obtain was necessary merely to properly convey the exchange of lands. Optionors had no reason to expect that the survey would contain any lands other than those described in the option. We believe the effect of the survey, by including additional acreage, was to merely make an offer as to the amount over that agreed to in the option agreement, which could be rejected or accepted by the optionors, but which did not effect the validity of the acceptance of the original option.

Although we find no Indiana case law directly on point, and precious little in other jurisdictions, we believe this to be the fair *606

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Bluebook (online)
408 N.E.2d 603, 77 Ind. Dec. 668, 1980 Ind. App. LEXIS 1608, Counsel Stack Legal Research, https://law.counselstack.com/opinion/theobald-v-chumley-indctapp-1980.