APPEAL from the Circuit Court of Tazewell County; the Hon.
HOWARD WHITE, Judge, presiding.
MR. JUSTICE FULTON DELIVERED THE OPINION OF THE COURT:
This is a direct appeal involving a freehold from the circuit court of Tazewell County, which denied a motion of appellants to dismiss the complaint and entered a decree for specific performance on behalf of appellee, in accordance with the terms of an option contained in a lease.
William Walz and Louise Walz, appellants here, were the owners of real estate located at the intersection of Main Street in the city of Morton and State highway route No. 150. The appellants leased these premises to the Texas Company for use as a gasoline service station by a lease for a period of ten years from June 1, 1940, dated May 4, 1940, which included an option to purchase the premises at any time during the term of the lease. On April 25, 1949, the appellants leased the same premises to the Shell Oil Company for a period of ten years, beginning June 1, 1950. At this time the Texas Company assigned its lease to Willard B. Gaskins, trustee and appellee here. On May 17, 1950, appellee exercised the option to purchase contained in the Texas Company lease. When the appellants refused to carry out the terms of the option, appellee filed his complaint in equity for specific performance. The circuit court overruled and denied the motion to dismiss filed by appellants and entered a decree for specific performance in accordance with the terms of the option.
All evidentiary matters have been admitted by the pleadings. The parties agree that the only questions involved are whether or not the appellee had a binding option to purchase the premises and whether or not that option to purchase was properly exercised.
The option reads as follows:
"(10) Option. Lessor hereby gives the lessee the right and option to purchase the demised premises and all structures and improvements thereon at any time during the first five years of this lease, for the sum of Fifteen Thousand Dollars ($15,000.00) and Seventeen Thousand Five Hundred Dollars ($17,500.00) any time during the last five years of this lease.
"In event a part of the premises herein demised is condemned, the amount of damages awarded to the lessor in consequence thereof shall be deducted from the purchase price upon exercise of this option by the lessee.
"Lessee's notice of election to purchase shall be sufficient if deposited in the mail addressed to lessor at or before midnight of the day on which option term expires. Lessor shall, when requested by lessee, deliver to lessee complete abstracts of title, furnish up-to-date survey by a licensed or registered professional engineer or surveyor, showing elevations of property and corners marked with concrete monuments, upon receipt of which the lessee shall have a reasonable time in which to examine the title and, upon completion of title examination, if title is found satisfactory, shall tender the purchase price to lessor, and lessor, at time of such tender, shall deliver to the lessee, a good and sufficient warranty deed conveying the premises to the lessee free and clear of all encumbrances (including, without limiting the foregoing, the rights of dower and/or courtesy)."
On April 17, 1950, appellee sent the following letter to the defendants exercising option to purchase:
"You are hereby notified that the option contained in said lease to purchase said property for the sum of $17,500.00 is hereby exercised. Please deliver your abstract of title to said premises, brought down to date showing good and merchantable title in you and as soon as the same has been examined the purchase price will be paid on delivery of your warranty deed. The option also provides for the furnishing of up-to-date survey but it is possible that this may not be necessary after we have examined the abstract of title.
"In the event you wish to discuss this matter personally with me, my address is 913 First National Bank Building, Peoria, Ill."
The lower court held this to be a valid acceptance of appellants' offer to sell contained in the option and that a contract for the sale of the real estate existed between the parties, and thereby decreed specific performance. The court further declared the lease to the Shell Oil Company void and a cloud upon the title of appellee.
The argument made by appellants is that the notice to exercise the option was not a legally sufficient acceptance of the offer to sell, inasmuch as appellee demanded an abstract of title showing good and merchantable title in appellants which, by the terms of the option, appellants had not offered to furnish. Further, appellants claim that appellee reversed the tender procedure set forth in the option.
It is the contention of appellants that the request for an abstract of title "showing good and merchantable title" contained in the notice to exercise the option imposed a new condition not contained in the option, and therefore, voided the option and appellants were not required to convey the land to appellee. To support this theory they cite cases represented generally by ...