Draper v. Gochman

In Draper v. Gochman (Tex. 1966) 400 S.W.2d 545, a lease gave the lessee a right of first refusal to purchase the interest of the grantor in the leased property if the grantor "'desires to sell or dispose of his interest.'" (Ibid.) The grantor later took out a loan secured by a deed of trust on the property. He defaulted and his interest was sold by the trustee under the deed of trust to a third party. In a suit by the lessor against the third party, the lessor contended that the grantor "voluntarily set in motion a chain of events which resulted in a sale" by executing the deed of trust, and that "when the trustee's sale occurred, it was as a result of an act deliberately authorized by the grantor." (Id. at p. 547.) The court disagreed, concluding that the words the parties used in creating the right should be given their ordinary meaning: "The term 'desire to sell' as here used was intended to cover a voluntary act on the part of the grantor, covering either an offer on his part to sell, or the willingness on his part to accept an offer from a third person. There is no evidence that he ever expressed a willingness or desire to sell. He never fixed a price for which he was willing to sell. What he presumably did have was a desire to borrow money, rather than a desire to sell the property." (Ibid.) The court believed that to hold otherwise, "would virtually prevent the mortgaging of property on which there was a right of first refusal." (Ibid.)