Normile v. Miller

CAPTION:
NAME: Normile v. Miller
COURT: Supreme Court of North Carolina
DATE: 1985 Judge Frye
TYPE OF ACTION: Breach of Contract

FACTS:

Timeline
August 4th 1980 the property located in Charlotte, NC was listed for sale
Same day
Property was showed to Plaintiff by real estate agent Richard Byer of Gallery of Homes
An offer letter was created by Plaintiff with the help of agent
Original offer letter created by Plaintiff included a timeline of “5:00 P.M. Aug. 5th 1980. A signed copy shall be promptly returned to the purchaser.”
~Afternoon
Agent brings original offer letter to Defendant-seller Miller
Miller returns executed form to Byer which contains several changes.
Changes: larger down payment, larger down payment at closing, and a change in terms from 25 years to 20 year mortgage
~Evening
Agent presents Defendant’s counteroffer to Plaintiff
Plaintiff neither accepts or declines the offer (Agent takes this for Declines)
August 5th 12:30AM to 2:00 P.M. Agent shows property and similar offer (similar to counteroffer) to 3rd party which is accepted.
Sometime after 2:00PM and before 5:00PM Plaintiff Normile submits offer to purchase to Gallery of Homes office along with deposit listed on counteroffer

PROCEDURAL HISTORY:

CONTENTIONS OF THE PARTIES:

PLAINTIFF: That there existed a contract between the Plaintiff and Defendant, and that the contract included a deadline for acceptance of the offer.

DEFENDANT: That there existed no contract between the party’s, and further that if there was a contract there was no option, no provision for time-for-acceptance.

ISSUE: Did the Plaintiff have an option to buy the property that was included in the original offer, or was that option removed by the existence of a counteroffer?

HOLDING: That Plaintiff did not have an option to buy the property, and that when presented with the offer needed to affirm or decline the offer.

RULE:
Effects of a Counteroffer
original offer is rejected and ceases to exist
counteroffer requires the original offeror to either accept or reject

RATIONALE:

“a clause stipulating that the seller must accept the offer and approve the sale within a certain specified period of time...simply indicates that the offer will automatically expire”
“An ‘offer to purchase’ is simply an offer by a purchaser to buy property”

The Plaintiff did not accept, either expressly or by conduct, defendant’s counteroffer. But instead chose to operate under the impression that they had an option to buy the property and that the property was “off the market”
The defendant made no promise or agreement to hold her offer open
Option:
1: the power or right to choose, also : a choice made or available
2: a privilege of demanding fulfillment of a contract on any day within a specified time
3: a contract conveying in exchange for the payment of a premium a right to buy or sell designated securities, commodities, or interests in property at a specified price during a stipulated period

Since the Defendant’s offer included no option the defendant was able to enter into a contract with the 3rd party.
Defendant gave notice to Plaintiff that the counteroffer had been terminated.

RESULT:
“you snooze you lose”