by: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law
OPTIONS; RIGHT OF FIRST REFUSAL: Buyer who contracts to buy property subject to a right of first refusal in another has no right to object to variation of the closing date under the right of first refusal if Buyer's own contract provides that its closing would occur on a date certain or such other date specified by the parties. The agreement between the lessee and the owners to extend closing was, therefore, within the terms authorized by the third party offer. Bidache, Inc. v. Martin, 899 P.2d 872 (Wyo. 1995). The lessee of the property held a right of first refusal, and elected to exercise it upon being presented with Buyer's contract to buy. The court held that once the condition precedent to the exercise of the right of first refusal, which was the owner's intent to sell, was met, the lessee's right of first refusal ripened into an option and the law relating to option contracts applied. The court further found that the third party's offer never became a legally binding contract since so long as the lessee held a valid right of first refusal, acceptance of the third party's offer was dependant on the lessee's failing to exercise its right. Once the lessee exercised that right, a contract was created between the lessee and the owner and the third party's offer remained just an offer. If the lessee did not exercise the right of first refusal, then the Buyer had a contract right to buy. Buyer was not a party to the contract between the owner and the lessee and the third party's consent to an extension of the closing date by the owner and the lessee was, therefore, not required.
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