Gratuitous Option To Buy Farmland Revocable At Any Time.

The defendant, as part of her estate plan transferred two quarter sections of land to each of two of her children via quitclaim deeds and reserved a life estate.  The following year, the defendant granted an option to buy the two quarter sections to one of the two children, the plaintiff in this case.  The option said that it was granted in consideration of $10 and other good, valuable and legally sufficient consideration, and that it would remain in force until the end of 2015.  The option also specified that it was exercisable upon the plaintiff tendering the full purchase price of $200/acre ($64,000) before the end of 2015.  The plaintiff was not informed of the option until several days after it was executed, and never paid anything for the option.  In 2012, the plaintiff wrote the defendant a letter stating an intent to exercise the option, but not tendering the full purchase price (or any amount, for that matter).  The defendant notified the plaintiff that she was terminating the option, and the plaintiff sued for specific performance of the option.  The trial court ruled for the defendant and, on appeal, the court affirmed.  The court noted that the plaintiff never tendered the full purchase price to the defendant and, thus, never exercised the option before it was terminated.  The court also noted that the defendant could terminate the option at any time before acceptance because it was a gratuitous option that the plaintiff never paid anything for.  Deckert v. McCormick, No. 20140151, 2014 N.D. LEXIS 226 (N.D. Sup. Ct. Dec. 18, 2014).

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