## Facts

- Beale Street Development Corporation (BSDC) leased certain Beale Street property in Memphis, Tennessee, to George Miller.
- BSDC gave Miller an option to buy the leased property, which could be exercised by paying off the property’s mortgage and any liens on the property.
- Miller later entered into a sublease with Curtis Calvin that included a separate four-year option for Calvin to purchase.
- Under Calvin’s option, Calvin would trigger the purchase by agreeing to pay off the mortgage and tendering a $25,000 down payment to Miller; Miller would then buy the property from BSDC and resell it to Calvin.
- The sublease option did not address responsibility for nonmortgage liens.
- A nonmortgage lien of approximately $42,600 for unpaid taxes existed against the property.
- Calvin informed Miller that he wanted to exercise the option, but he also took the position that Miller was required to pay off the tax lien as a condition of closing.
- Miller refused to proceed on that basis and stated he would go forward only if Calvin agreed to clear the tax lien.
- Calvin’s option period expired without a completed purchase.
- After expiration, Calvin intervened in ongoing litigation between BSDC and Miller, alleging Miller wrongfully prevented him from exercising the sublease purchase option.
- The trial court dismissed Calvin’s intervening complaint, and Calvin appealed.

## Issues

1. Whether Calvin could enforce the sublease purchase option when his attempted exercise required Miller to satisfy a nonmortgage tax lien that the sublease option did not assign to Miller.
2. Whether Miller’s refusal to proceed unless Calvin cleared the tax lien amounted to wrongful prevention that excused Calvin from exercising the option strictly according to its stated terms.

## Decision

- The Tennessee Court of Appeals affirmed the trial court’s dismissal of Calvin’s intervening complaint.
- The court treated the sublease option’s text as controlling and declined to impose an obligation on Miller to remove a nonmortgage tax lien that the sublease did not address.
- Because Calvin’s asserted right to purchase depended on adding a term not found in the sublease option (Miller’s responsibility for the tax lien), Calvin could not obtain relief on a theory that Miller improperly blocked the option’s exercise.

## Legal Principles

- Option contracts for the purchase of real property must be exercised in the manner specified by the option; an optionee cannot effectively exercise by adding conditions not stated in the option.
- Courts interpret an option according to its written terms and generally will not read in additional duties (such as clearing nonmortgage liens) when the agreement is silent.
- A party’s refusal to accept a new, extra-contractual condition is not, by itself, wrongful prevention of the other party’s performance.

## Conclusion

Beale Street Development Corp. v. Miller holds that a sublessee seeking to enforce a purchase option must rely on the option terms actually agreed to in the sublease. Where the option required a mortgage payoff arrangement and a $25,000 down payment but did not assign responsibility for nonmortgage liens, the optionee could not condition his purchase on the lessor’s payment of a tax lien and then claim the lessor wrongfully prevented the option’s exercise when the lessor refused to accept that added requirement.


Beale Street Development Corp. v. Miller, 2003 WL 1618068 (2003)