This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
The case concerns a dispute over the enforceability of rights of first refusal on two parcels of land: a one-acre residential lot (Lot One) and a surrounding 52-acre tract. The parcels were originally part of a family conveyance in 1978, with rights of first refusal included in the deeds. After acquiring sole ownership of both parcels, the Defendant sought to sell them together to a third party. The Plaintiffs, who held rights of first refusal, argued they could purchase the parcels separately, while the Defendant insisted the rights must be exercised for the entire property (paras 2-4).
Procedural History
- District Court, 1995: The Defendant filed a partition action, which was settled with the Defendant acquiring sole ownership of the parcels (para 3).
- District Court, (N/A): The court granted summary judgment to the Defendant, holding that the New Mexico Subdivision Act barred separate enforcement of the rights of first refusal but found the rights did not constitute an unlawful restraint on alienation (para 5).
Parties' Submissions
- Plaintiffs-Appellants/Cross-Appellees: Argued that their rights of first refusal allowed them to purchase the parcels separately and that the New Mexico Subdivision Act did not apply to the transaction (paras 4-5).
- Defendant-Appellee/Cross-Appellant: Contended that the rights of first refusal could not be enforced separately due to the Subdivision Act and that the rights constituted an unreasonable restraint on alienation (para 5).
Legal Issues
- Does the New Mexico Subdivision Act prohibit the separate enforcement of rights of first refusal for the two parcels?
- Do the rights of first refusal constitute an unlawful restraint on alienation of property?
Disposition
- The court reversed the district court's ruling that the Subdivision Act barred separate enforcement of the rights of first refusal (para 20).
- The court affirmed the district court's ruling that the rights of first refusal did not constitute an unlawful restraint on alienation (para 20).
- The case was remanded for further proceedings consistent with the opinion (para 20).
Reasons
Per Bosson J. (Apodaca and Bustamante JJ. concurring):
Subdivision Act Analysis: The court held that the Subdivision Act did not apply to the transaction because the parcels were lawfully created and remained separate on the official plat map. The proposed sale would not result in a "division into two or more parcels" as defined by the Act. The court emphasized that the Act's purpose is to prevent subterfuge by illegal subdividers, which was not present in this case (paras 6-13).
Rights of First Refusal: The court found the rights of first refusal enforceable because they were tied to fair market value or a bona fide offer, making them reasonable and not an unlawful restraint on alienation. The court distinguished this case from Gartley v. Ricketts, where a fixed-price right of first refusal was deemed unreasonable (paras 15-19).
Practical Considerations: The court acknowledged potential access issues between the parcels but noted these could be addressed on remand (para 14).