Kerley v. Nu-West, Inc

762 P.2d 631 (1988)

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Nature of the Case

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Facts

Jacobson and Resorco, Inc. (Ds) had an interest in a subdivision and acting through a trustee sold fifteen acres of that land to Kerley (P). They retained ownership of their adjoining land. The transaction was set forth in two agreements; on an agreement of sale and the other an Architectural Planning and Consulting Agreement. The sales agreement specified a price of $390,000 or $26,000 per acre to be paid $40,000 down and the balance in increments as portions of the property were selected and received by P. The sales agreement specified that P would develop, improve, and resell the fifteen acres thus benefiting the remaining land owned by Ds. The sales agreement also called for the execution of an Architectural Planning and Consulting Agreement with Resorco that would allow Jacobson to approve the site plan and design any structures to be built. That agreement was executed which included prior approval of all buildings and an additional 10% fee of the gross sales price from the first sale of each improved portion of the property. That obligation ran with the land until the amount due on the first sale was paid. It was also agreed in 1988-1989 that Resorco could repurchase any of the land not yet developed or sold. After the agreements were executed, P then sued Jacobson and Nu-West, Resorco's successor in interest, seeking rescission in that the Architectural agreement was an unreasonable restraint on alienation of property. The trial court granted summary judgment to D. P appealed.