Weilbacher v. Ring

[CONTRACT LAW]

In Weilbacher v. Ring,[1] the supreme court held that contracts to transfer privilege are not unenforceable simply because a third party must approve the transfer before the transferee can enjoy the privilege’s benefits.[2] Weilbacher brought action against Ring, a purchaser of one of his lots, seeking rescission of the sale based on a mutual mistake concerning which boat-tie ups were associated with each of his lots.[3] As the right to some of the tie-ups in question had been subsequently re-sold to Berube, a third party whom Weilbacher had failed to join as a defendant, the court ordered Weilbacher to join Berube as an indispensable party.[4] Weilbacher declined.[5] Asserting that Berube was necessary to provide relief to the parties, the lower court dismissed Weilbacher’s claim.[6] On appeal, Weilbacher argued that because the failure to gain approval by the homeowner’s association had rendered the sales contract between him and Ring meaningless, Berube was not an indispensable party because Weilbacher had no claim against him.[7] The supreme court affirmed the lower court’s decision, reasoning that many types of privilege are subject to approval by third parties prior to sale.[8] Nevertheless, according to the court, the initial sales contract here memorializing the privilege transfers were no less enforceable just because public agency approval was required before the parties could receive the full benefits of their contractual obligations.[9] Affirming the lower court’s decision, the supreme court held that contracts to transfer privilege are not unenforceable simply because a third party must approve the transfer.[10]

 



[1] 296 P.3d 32 (Alaska 2013).

[2] Id. at 38.

[3] Id. at 34–35.

[4] Id. at 35.

[5] Id.

[6] Id. at 36.

[7] Id. at 38.

[8] Id.

[9] Id.

[10] Id.

Weilbacher v. Ring

[CONTRACT LAW]

In Weilbacher v. Ring,[1] the supreme court held that contracts to transfer privilege are not unenforceable simply because a third party must approve the transfer before the transferee can enjoy the privilege’s benefits.[2] Weilbacher brought action against Ring, a purchaser of one of his lots, seeking rescission of the sale based on a mutual mistake concerning which boat-tie ups were associated with each of his lots.[3] As the right to some of the tie-ups in question had been subsequently re-sold to Berube, a third party whom Weilbacher had failed to join as a defendant, the court ordered Weilbacher to join Berube as an indispensable party.[4] Weilbacher declined.[5] Asserting that Berube was necessary to provide relief to the parties, the lower court dismissed Weilbacher’s claim.[6] On appeal, Weilbacher argued that because the failure to gain approval by the homeowner’s association had rendered the sales contract between him and Ring meaningless, Berube was not an indispensable party because Weilbacher had no claim against him.[7] The supreme court affirmed the lower court’s decision, reasoning that many types of privilege are subject to approval by third parties prior to sale.[8] Nevertheless, according to the court, the initial sales contract here memorializing the privilege transfers were no less enforceable just because public agency approval was required before the parties could receive the full benefits of their contractual obligations.[9] Affirming the lower court’s decision, the supreme court held that contracts to transfer privilege are not unenforceable simply because a third party must approve the transfer.[10]

 



[1] 296 P.3d 32 (Alaska 2013).

[2] Id. at 38.

[3] Id. at 34–35.

[4] Id. at 35.

[5] Id.

[6] Id. at 36.

[7] Id. at 38.

[8] Id.

[9] Id.

[10] Id.