Lease with Option to Purchase Required Written Notice to Exercise Option. Written Notice Not Given; Holding Over for 14 Years Held Not Evidence of Exercise

In Horton v Gebolys, an unpublished Michigan Court of Appeals opinion, Plaintiff and Defendant entered into a lease in 2004 for a term of one year. The parties also entered into an option to purchase the property which also expired at the same time as the lease. The option was required to be exercised in writing. In 2014, Defendant quit paying rent and in 2018 Plaintiff filed an eviction case. After trial, the court found that defendant did not exercise the option to purchase, was a holdover tenant under the lease, and issued a judgment not possession. Defendant appealed.

The decision was affirmed on appeal. Defendants claim that he exercised the option was unavailing because he never presented a writing purporting to exercise the option as required by its terms. An option must be exercised strictly in accordance with its terms and defendant failed to establish that he did so. His claim that holding over for 14 years should be considered as evidence of his exercise was also unavailing given the lack of a writing.

© Steve Sowell 2022