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Watch on YouTube: πŸ“‹ Reformation and the Parol Evidence Rule β€” A 24-Hour Right of First Refusal
β–Ά Watch on YouTube: πŸ“‹ Reformation and the Parol Evidence Rule β€” A 24-Hour Right of First Refusal

In short: Not unless the right is in the sale contract or is exercised exactly as written. In Futernick v. Trushina, former spouses sold their Miami-Dade marital home, and the ex-husband claimed a 24-hour right of first refusal under their marital settlement agreement. On July 9, 2014, the Third District affirmed a judgment ordering the sellers to close with the buyer, holding the sale contract did not incorporate the settlement agreement and that the husband did not meet the conditions for exercising the right anyway.

The Facts

Frank Futernick and Karen Beber owned their former marital home together. Their marital settlement agreement gave Futernick a right of first refusal if the house was sold to someone else. As described at oral argument, he had a 24-hour window and had to sign a written contract on the same terms as the outside offer, including the deposit and timing, at a price $10,000 higher.

Natalia Trushina offered to buy the house. The sale contract she signed with both owners did not mention the right of first refusal. Futernick then sent a writing saying he was exercising his right. Trushina sued for specific performance, and the trial court ruled for her and denied Futernick’s claim to reform the sale contract to add the right of first refusal.

The appeals were consolidated under No. 3D13-2041 and argued in 2014. The points below are what the lawyers argued, not findings by the court.

  • The sellers argued the trial judge wrongly believed he could not consider parol evidence on a reformation claim, and that emails between the brokers showed everyone, including the buyer, understood the husband had 24 hours to match.
  • They argued that once Futernick said in writing he was exercising the right, a binding contract formed, so his failure to sign a separate matching contract did not matter.
  • The buyer argued reformation requires a mutual mistake, and the sellers read and signed a contract with no right of first refusal, changing only the closing date and assignability.
  • The buyer argued the right had already expired under the settlement agreement’s own timing, and that Futernick never signed a matching contract, offered $10,000 more, or put up the deposit.
  • On cross-appeal, the buyer sought a contractual holdover charge of $1,000 a day that the trial court had refused to award.

The Decision

In a written opinion filed July 9, 2014, the Third District affirmed the judgment ordering the sellers to perform the sale contract. It gave two reasons. First, the sale contract did not incorporate the marital settlement agreement, so the right of first refusal in that agreement did not control the sale. Second, even if it had, Futernick did not comply with the conditions for exercising the right. The court relied on the rule that courts may not rewrite clear and unambiguous contracts.

The court affirmed the buyer’s cross-appeal issue without discussion. It denied the sellers’ motion for appellate attorney’s fees, later denied their motion for rehearing or clarification on the fee rulings, and issued its mandate on September 19, 2014.

The case came back. In a later appeal, Futernick v. Trushina, Nos. 3D14-3040 and 3D15-2922 (Fla. 3d DCA Nov. 23, 2016), the Third District affirmed an award of $224,000 in delay damages to the buyer, based on a rental value of $14,000 a month for the 16 months the closing was delayed while the sellers appealed.

The Law

A right of first refusal gives its holder the chance to buy property on the same terms a third party has offered. Florida courts enforce it as written, which means the holder must match the terms and meet the deadline and conditions in the document that creates it.

Reformation lets a court rewrite a written contract when, because of a mutual mistake, the writing does not say what both parties actually agreed. Parol evidence, meaning evidence outside the writing, can be used to prove that mistake. But reformation is not a way to add a term one side never agreed to.

A buyer whose seller refuses to close may sue for specific performance, an order requiring the seller to convey the property. When the seller’s appeal delays the closing, the buyer may later recover damages for the delay, as happened here. A pending suit over title is usually backed by a notice of lis pendens under section 48.23.

Divorce settlement agreements can affect property sales years later. A right of first refusal in a settlement agreement binds the former spouses, but an outside buyer who signs a contract that does not mention it may still be able to enforce that contract.

Lessons

  • If you hold a right of first refusal from a divorce, follow its terms to the letter: deadline, written contract, matching deposit and price. Saying you exercise it is not always enough.
  • Sellers bound by a right of first refusal should put it in the sale contract as a contingency. Leaving it out can expose them to specific performance by the buyer.
  • Reformation fixes a shared mistake in the writing. It will not add a right one party knowingly left out.
  • Appealing and losing can cost more than the appeal. Here the delay produced a $224,000 damages award.

Source: Futernick & Beber v. Trushina, Nos. 3D13-2041 & 3D13-2022 (Fla. 3d DCA July 9, 2014); ACIS docket; later appeal: Futernick v. Trushina, Nos. 3D14-3040 & 3D15-2922 (Fla. 3d DCA Nov. 23, 2016).

Watch the Oral Argument

These are recordings of the Third District oral argument, posted on the channel in two uploads. What lawyers and judges say at argument is not the ruling; the decision is summarized above.

πŸ“‹ Reformation and the Parol Evidence Rule β€” A 24-Hour Right of First Refusal

πŸ“‹ He Exercised the Right of First Refusal Within 24 Hours β€” Then Came Reformation

Go Deeper

Frequently Asked Questions

Can my ex-spouse stop the sale of our house with a right of first refusal?

Only if the right is exercised exactly as the settlement agreement requires, and even then a buyer whose contract does not mention it may be able to enforce the sale. In Futernick v. Trushina, the Third District held the sale contract did not incorporate the settlement agreement and the husband did not meet its conditions.

How do I properly exercise a right of first refusal in Florida?

Do exactly what the document says, within the deadline: usually a written acceptance and a contract matching the outside offer’s price, deposit and terms. In Futernick, a written statement that the husband was exercising the right was not enough without the matching contract and payment terms.

Can a court add a missing term to a real estate contract?

Only through reformation, which requires proof that both parties agreed to the term and it was left out by mutual mistake. Courts will not rewrite a clear contract to add a term one side knowingly omitted.

Can a buyer get damages if the seller's appeal delays the closing?

Yes, it can happen. In the later Futernick appeal, the Third District affirmed $224,000 in delay damages measured by the home’s rental value during the 16 months the closing was delayed.

Talk to a Florida real estate litigation lawyer

Weidner Law, P.A. handles Florida real estate disputes, title problems and appeals from St. Petersburg. If you need a real estate litigation lawyer, call (727) 954-8752 or email weidner@mattweidnerlaw.com.

Read the law yourself, free: every Florida statute and court rule is on floridarules.net.

This article is general information about Florida law, not legal advice about your situation. Reading it, watching the videos, or contacting the firm does not create an attorney-client relationship. Every case turns on its own facts, and past results do not guarantee a similar outcome. The hiring of a lawyer is an important decision that should not be based solely upon advertisements.

Have a question about your own situation? Comments are public. Please don’t post personal details here. Contact Weidner Law privately or call 727-954-8752.

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