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SPECIFIC PERFORMANCE OF A RECORDED OPTION TO BUY LAND WAS PROPERLY ORDERED DESPITE THE INABILITY TO IMMEDIATELY RECORD THE DEED UPON PURCHASE, TRANSFER OF THE DEED, NOT RECORDING OF THE DEED, WAS ALL THAT WAS REQUIRED BY THE OPTION AGREEMENT.

The Third Department, over a two-justice dissent, determined a recorded option agreement allowing plaintiff to buy back a portion of the parcel of land sold by the plaintiff was enforceable against subsequent purchasers of the parcel, even though the deed to the option property could not be recorded at the time the option was exercised (subdivision approval would be necessary to record the deed). The court held that because only transfer of the deed, not the recording of the deed, was required under the option agreement, the agreement could be enforced by an action for specific performance (which requires that the buyer be ready, willing and able to purchase the property when the option is exercised):

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… “[N]othing within the four corners of the option agreement requires plaintiff to obtain subdivision approval prior to exercising its option with respect to the 3.5-acre parcel, nor does the option agreement provide that the failure to obtain such approval renders the underlying agreement null and void” … . Further, as Supreme Court correctly noted, Real Property Law § 291 does not compel plaintiff to actually record the reconveyance deed for the subject parcel, as “recording is not required in order to transfer title to real property” (… see Real Property Law § 291). Rather, title to property vests upon the execution and delivery of the deed (see Real Property Law § 244…), and the fact that the deed may not be recorded until a later date — or at all — does not affect the validity of the conveyance … . While it is true that, generally speaking, prudence would suggest that a grantee record his or her deed, there is no requirement that he or she do so. More to the point, we do not interpret the option agreement before us as requiring plaintiff to record the deed obtained subsequent to exercising its rights relative to the 3.5-acre parcel — only a provision that, if it elects to do so, it be at its expense.  Tomhannock, LLC v Roustabout Resources, LLC, 2017 NY Slip Op 02712, 3rd Dept 4-6-17

REAL PROPERTY (SPECIFIC PERFORMANCE OF A RECORDED OPTION TO BUY LAND WAS PROPERLY ORDERED DESPITE THE INABILITY TO IMMEDIATELY RECORD THE DEED UPON PURCHASE, TRANSFER OF THE DEED, NOT RECORDING OF THE DEED, WAS ALL THAT WAS REQUIRED BY THE OPTION AGREEMENT)/SPECIFIC PERFORMANCE (REAL PROPERTY, SPECIFIC PERFORMANCE OF A RECORDED OPTION TO BUY LAND WAS PROPERLY ORDERED DESPITE THE INABILITY TO IMMEDIATELY RECORD THE DEED UPON PURCHASE, TRANSFER OF THE DEED, NOT RECORDING OF THE DEED, WAS ALL THAT WAS REQUIRED BY THE OPTION AGREEMENT)/DEEDS  (SPECIFIC PERFORMANCE OF A RECORDED OPTION TO BUY LAND WAS PROPERLY ORDERED DESPITE THE INABILITY TO IMMEDIATELY RECORD THE DEED UPON PURCHASE, TRANSFER OF THE DEED, NOT RECORDING OF THE DEED, WAS ALL THAT WAS REQUIRED BY THE OPTION AGREEMENT)/OPTION AGREEMENTS (REAL PROPERTY, SPECIFIC PERFORMANCE OF A RECORDED OPTION TO BUY LAND WAS PROPERLY ORDERED DESPITE THE INABILITY TO IMMEDIATELY RECORD THE DEED UPON PURCHASE, TRANSFER OF THE DEED, NOT RECORDING OF THE DEED, WAS ALL THAT WAS REQUIRED BY THE OPTION AGREEMENT)

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