Klein v. McCullough (Signed Opinion)Annotate this Case
The Supreme Court reversed the order of the circuit court concluding that the right of first refusal in a deed conveying land from the grantor to the grantee but containing a clause granting the grantee to give a "stranger" the right of first refusal to any future conveyance of the land was not void under the "stranger to the deed" rule.
The "stranger to the deed" rule identifies someone who is neither a grantor nor a grantee to a conveyance as a "stranger" and posits that any property interest in favor of that stranger, and which is contained in a reservation or an exception, is void. The circuit court applied the "stranger to the deed" rule and ruled that the right of first refusal clause in the deed was void and unenforceable. The Supreme Court reversed, holding (1) a right of first refusal clause in a deed is neither an exception nor a reservation; and (2) therefore, the circuit court erred when it applied the "stranger to the deed" rule and dismissed the complaint.