Walters v. Sporer, 298 Neb. 536

Background

In 1998 John D. Walters (John) and his then-spouse conveyed ~8 acres to Douglas and Debra Lau (the Laus) by warranty deed; the deed included a clause giving Grantor (John) a 30‑day written notice and a right to buy on the same terms (a claimed right of first refusal).
The transaction also included a trust deed, promissory note, an option on adjoining acreage, and other documents; the Laus later paid off the note and received reconveyance in 2007.
The Laus sold the combined tract (~13 acres) in 2013 to Jay and Melanie Sporer (the Sporers) without giving John written notice; John filed suit in 2014 seeking specific performance (enforce the right of first refusal) and quiet title.
The district court granted summary judgment to the Laus and Sporers, holding the right of first refusal was void under Neb. Rev. Stat. § 36‑105 (statute of frauds) because the Laus had not signed a separate writing; John appealed.
The Nebraska Supreme Court considered whether a right of first refusal reserved in a deed is an enforceable nonvested property interest and whether acceptance of the deed binds the grantee to reservations therein.

Issues

Issue	Plaintiff's Argument (Walters)	Defendant's Argument (Laus / Sporers)	Held
Whether a right of first refusal reserved in a deed is an enforceable property interest	The deed reservation created an enforceable right of first refusal; the Laus accepted the deed and are bound by its reservations	A right of first refusal is not a reservation of an existing grantor interest and is therefore subject to the statute of frauds as a contract requiring the grantee’s signed writing; Laus never signed such a contract	Held: A right of first refusal is a nonvested property interest and may be reserved in a deed; acceptance of the deed binds the grantee to reservations absent fraud.
Which statute governs: § 36‑103 (interest in land) vs § 36‑105 (contract for sale of land)	The reservation is an interest in land governed by § 36‑103 (signature by party to be charged satisfied by acceptance of the deed)	The right is effectively a contract for sale (or regrant by grantee) subject to § 36‑105 and void without a separate signed writing by the grantee	Held: The right resembles a nonvested property interest (like an option) and falls within § 36‑103; acceptance of the deed satisfies signature requirement.
Whether the deed provision is a "reservation" (vs an exception) and thus subject to the statute of frauds	The provision reserved a right in the grantor (John) and should be treated as a reservation enforceable against grantee upon acceptance	The provision is not a reservation because it does not reserve a present use/enjoyment right and instead requires a regrant by the grantee, so it must satisfy the statute of frauds as a contract	Held: The clause is a reservation (a regranting back to grantor of a nonpossessory interest) and reservations are subject to the statute of frauds but are enforceable when the grantee accepted the deed.
Whether summary judgment for Laus/Sporers was proper and whether John is entitled to summary judgment	John argued summary judgment for defendants was improper and that he should have judgment enforcing the right	Laus/Sporers argued no enforceable right existed; court below granted their summary judgment	Held: Summary judgment for Laus/Sporers was erroneous because genuine factual issues remain (e.g., scope/duration of the right, readiness to purchase); John is not entitled to summary judgment now.

Key Cases Cited

O’Connor v. Kearny Junction, 295 Neb. 981 (statutory interpretation and de novo review)
Schram Enters. v. L & H Properties, 254 Neb. 717 (construction of deed language is question of law)
In re Estate of Fuchs, 297 Neb. 667 (statutory interpretation treated as question of law)
Winberg v. Cimfel, 248 Neb. 71 (distinguishing options and rights of first refusal; ripening into enforceable option)
Jones v. Stahr, 16 Neb. App. 596 (right of first refusal may ripen into assignable option)
Bauermeister v. Waste Mgmt. Co., 280 Neb. 1 (options and similar interests are nonvested property interests)
Schupack v. McDonald’s System, Inc., 200 Neb. 485 (rights of first refusal may be personal; limited to facts)
Schaffert v. Hartman, 203 Neb. 271 (discussion of reservations that create rights to use/enjoy land)
Elrod v. Heirs, Devisees, etc., 156 Neb. 269 (reservations may create nonpossessory interests beyond easements)