LaPorte v. Blum, No. 1167-11-13 Cncv (Toor, J., Mar. 17, 2015).

[The text of this Vermont trial court opinion is unofficial. It has been reformatted from the original. The accuracy
of the text and the accompanying data included in the Vermont trial court opinion database is not guaranteed.]

                                           VERMONT SUPERIOR COURT
                                              CHITTENDEN UNIT
                                               CIVIL DIVISION

                                                           │
WILLIAM LAPORTE, JAMES LAPORTE,                            │
and BURGESS SUGARHOUSE, LLC                                │
 Plaintiffs                                                │
                                                           │
    v.                                                     │             Docket No.1167-11-13 Cncv
                                                           │
                                                           │
PAMELA B. BLUM, RICHARD W.                                 │
BURGESS, NANCY B. RICE, and JUDITH                         │
K. BURGESS,                                                │
 Defendants                                                │
                                                           │


                                           RULING ON THE MERITS

           This is an intra-family dispute over an option to buy land. Plaintiffs are (1) the

grandchildren of the former owners, and (2) the grandchildren’s sugaring business. Defendants

are Plaintiffs’ aunts and uncles. Plaintiffs seek to enforce the option to purchase the family land

on which they have been sugaring; Defendants filed a counterclaim seeking a declaration that

they properly revoked the option in 2013.1 A court trial was held on January 21 and 22 and post-

trial filings were complete February 13.2 Robert O’Neill, Esq. represents the Plaintiffs; Craig

Weatherly, Esq. represents the Defendants.

                                                  Findings of Fact

           The court finds the following facts to be established by a preponderance of the evidence.

Lawrence W. Burgess and Ruth O. Burgess (“the Grandparents”), now deceased, owned and

1
    They also raised the defense of undue influence, but have withdrawn that claim.
2
 The court notes that Defendants’ post-trial memo refers to some exhibits that were never offered in evidence, such
as, by way of example, 29, 30 and 31.
lived on the Underhill land in question. They had run a sugarhouse on the land, with about 2,000

taps. In 2001 they realized the lines needed to be replaced and, at 80 and 81 years of age, they

decided to stop sugaring. In 2004, their grandsons William and James hung a few buckets –

perhaps 150 – and in 2005 started buying new sugaring equipment. The Grandparents put in

about $10,000 to help with the roughly $52,000 worth of equipment. In 2005 they had about

1,000 taps going. William and James registered their trade name (Burgess Sugarhouse) in 2004.

There is no evidence that the name had any value. William and James would not have invested

the $52,000 if they had not been assured by their Grandparents that they could continue to sugar

on the property.

       At some point, Defendants became unhappy about the fact that the grandsons were

running the sugaring operation. None of the Defendants testified, so it is not clear to the court

why they objected.

       The Grandparents offered to give William and James the land, but the boys declined.

They discussed buying it, but because of concerns that the funds from a sale might reduce the

Grandparents’ Medicaid eligibility, that plan was rejected. The Grandparents met with lawyers to

work out an estate plan, which ended up as follows: the land would be given to Lawrence and

Ruth’s five children in equal shares, and William and James would be given an option to buy the

land. There would also be a lease allowing them to keep sugaring prior to execution of the

option. The Grandparents were fully aware that the Defendants objected to the option, but went

forward with it anyway. William and James told their Grandparents that they would not stay to

sugar there without the option and the lease.

       In May 2006, the property was deeded to the five children (the four Defendants plus the

mother of William and James) with Lawrence and Ruth reserving a life estate. In addition, the




                                                2
lease and option (the Option) were executed. Exs. 13-19. The lease runs until May 2021, with an

option to renew for another fifteen years. Ex. 14. The Option permits William and James to buy

the land for $400,000. Ex. 13, ¶ 3. It has two parts: one an option to buy the residence and one

for the balance of the land. Each is priced at $200,000. The residence option could not be

exercised until after the Grandparents were no longer living there, and even then only with their

permission. The option on the balance of the land could be exercised sooner. Both options would

expire if not exercised within nine months after the later of both Grandparents’ deaths. Id. ¶ 2.

        Defendants sent Requests for Admissions in July of 2014 to which Plaintiffs failed to

respond, and they are thus deemed admitted. They state that the fair market value was higher

than $400,000 both at the time the Option was issued and as of July 2014. However, there is no

other evidence as to fair market value. Thus, the court cannot say whether the land is worth $1

more, or $100,000 more, than the Option price.

        The Option has the usual recitation that it is given for “Ten Dollars and other good and

valuable consideration.” No one recalls ten dollars being exchanged at the closing. The lawyer

who drafted the Option testified that in fifty years of closings he never saw anyone exchange the

dollars recited as consideration.

        In 2010 Lawrence revised his will. It leaves a one quarter interest in the real estate to

each of the Defendants, but not to the fifth daughter, William and James’ mother. Ex. 28, ¶

6.1(a).3 This was the result of the family dispute over the grandsons getting the Option, which

led their mother to say her siblings could have her share. The will also states that it is Lawrence’s

intent “to provide my grandsons, JAMES LAPORTE and WILLIAM LAPORTE, the benefits of

the option and lease” referenced therein. Id. ¶ 6.1(d). It was the Grandparents’ desire that

3
  It is unclear whether the deeds were also revised at that time, but the court presumes they were. Likewise, the
court presumes that Ruth’s interests had already been transferred to Lawrence. No one has raised any issue about
those aspects of the case.


                                                       3
William and James continue to run a sugaring operation on the property after the Grandparents’

deaths.

          William and James continued to run the sugaring operation. Lawrence and Ruth both died

in 2013. In June of 2013, Defendants sent a letter to William and James saying that “the offer

represented by the Option is hereby withdrawn, and . . . no purported exercise of the Option by

you hereafter will be recognized as valid.” Ex. 33. In September of 2013, William and James

obtained financing and sent a letter attempting to exercise the Option. Ex. 35. This lawsuit

followed.

                                        Conclusions of Law

          Plaintiffs seek to enforce the Option as written. Defendants argue that because the ten

dollars recited in the Option was never paid, the Option was not supported by consideration and

is therefore unenforceable.

          The Restatement (Second) of Contracts states that an “option agreement is not invalidated

by proof that the recited consideration was not in fact given.” Restatement (Second) of Contracts

§ 87 cmt c (1981); see also, 3 Williston on Contracts § 7.21 (4th ed.) (“In one very important

respect, the recital or payment of a small sum, under the modern view, will suffice to make a

promise enforceable.       This   occurs   when the promise is         contained   in   an option

contract.”)(emphasis added). Another court has noted that “[t]he authors of the national treatises

on contracts have generally endorsed” this view. 1464-Eight, Ltd. v. Joppich, 154 S.W.3d 101,

109 (Tex. 2004). The Joppich court also pointed out that “the authors of law review commentary

have agreed that the nonpayment of a recited nominal consideration should not preclude

enforcement of a written option agreement.” Id. at 111.




                                                  4
       As is often the case, it does not appear that the Vermont Supreme Court has yet addressed

this question. However, the Restatement approach is reasonable because it seeks to enforce the

intent of the parties to the document at issue. As the evidence shows, it is typical to recite a few

dollars as consideration but not expect it to be paid. To hold that every such agreement is void

would not be in keeping with the intent of the parties to such options. Moreover, the Supreme

Court’s trend is to adopt the more modern views expressed in the Restatements. Thus, the court

predicts that it would do so here. In the absence of any controlling authority, the court will

therefore apply the Restatement approach. The recital of consideration is thus sufficient,

regardless of whether it was actually paid.

       While “gross disproportion between the payment and the value of the option” may make

an option unenforceable, that is not the case here. Restatement at § 87 cmt. b. There is no

evidence here as to the fair market value of the property. It may be $100 more than the $400,000

option price, or $100,000 more, but there is no evidence from which the court can make such a

determination. Thus, there is no evidence of “gross disproportion.”

       In any case, the court finds that there was “other consideration” for the Option aside from

the recital of ten dollars: the fact that William and James remained on the family land to continue

running the sugaring operation that the Grandparents could no longer manage themselves. The

Grandparents desired that continuity, and offered the Option in exchange for that commitment by

William and James. It is true that William and James had already spent considerable funds on

equipment prior to the Option, but that does not undercut the value of their remaining on the land

and running the operation after May 2006. William testified that they expressly told their

Grandparents that they would not stay to sugar there without the Option and the lease. This is

highly credible given the known opposition from Defendants, and the risk that they would seek




                                                 5
to remove William and James once the Grandparents died. The fact that the Grandparents went

forward with the Option in the face of the known opposition of four of their five children makes

clear that they heavily valued having William and James continue the family’s sugaring

operation.

       While the court cannot place an exact dollar value on the continuation of the sugaring

operation, that is not necessary to sustain the Option. “[A]nything which fulfills the requirement

of consideration will support a promise, regardless of the comparative value of the consideration

and of the thing promised. The rule is almost as old as the doctrine of consideration itself.” 3

Williston on Contracts § 7.21 (4th ed.); see also, Restatement (Second) of Contracts § 87, cmt a

(1981) (in analyzing option contracts, “courts do not ordinarily inquire into the adequacy of the

consideration bargained for.”). In any case, continuation of a family farm or family business is

often of very high value to older family members, and the evidence here supports a conclusion

that it was so valued by the Grandparents. There was adequate consideration here.

       Defendants also argue that the Option could be withdrawn, as they did in June of 2013.

The court disagrees. “An option is a continuing offer, and if supported by a consideration, it

cannot be withdrawn before the time limit.” Buchannon v. Billings, 127 Vt. 69, 75 (1968). It is

“an agreement by which one binds himself to sell and convey to another party certain property at

a stipulated price within a designated time.” Id. at 74. “The optionor is bound that the offer shall

be kept open and available in accordance with its terms[.]” Id.; see also 1 Williston on Contracts

§ 5:16 (4th ed.) (“During the option period the irrevocable offer may only be modified, released

or rescinded by agreement of the parties. It cannot be unilaterally withdrawn.”).




                                                 6
       Thus, Defendants did not have the right to revoke the Option. Plaintiffs exercised it in

September 2013, within the nine-month period after their grandfather’s death. It became a

binding, enforceable contract at that time.

                                              Order

       The court will enter judgment for Plaintiffs William and James LaPorte. The Option is

enforceable and has not been revoked.

       Dated at Burlington this 17th day of March, 2015.



                                                           _____________________________
                                                           Helen M. Toor
                                                           Superior Court Judge




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