As noted in WA3, Kyle took your advice and decided not to spend the money to fight for his claim to â€œKFC.comâ€ as the domain name for his new product line, Kyleâ€™s Flavorful Condiments and has reorganized the company as Alabama Sunshine, LLC. Kyle, however, does want to continue the move of his business to the next level of operations and he wants to complete the expansion by constructing of a new store in Fair Hope, AL. Recall that Kyle hired Alexa as his agent to contact Siri, negotiate a price, and, if possible, buy Siriâ€™s property; however, Kyle instructed Alexa to not tell Siri that she was working on behalf of Kyle. Unfortunately, Alexa realized that Siriâ€™s property was an exceptionally good deal and bought the property for herself, not Kyle as agreed. Kyle has gotten over his anger and wants to move on with the construction of the new building on Greenacre (the Alexa/Siri parcel of land).
Alexa acquired Greenacre from Siri in fee simple absolute and proposes to convey Greenacre to Kyle with a right of reverter (reversionary interest) as the location for Kyle’s new store. The proposed conveyance would be a defeasible fee (fee simple defeasible) with the condition that, should Kyle fail to construct and open his store on Greenacre within eighteen months or should Kyle cease to use Greenacre as a site for his store at any time in the future, then Greenacre would belong to the town of Fair Hope to use as a park. Alexa also mentions that she will not transfer mineral rights to Kyle and intends to transfer those to her daughter, Delta.
Kyle likes Greenacre because it is located within the town limits of Fair Hope, has a beautiful natural stream running through it, is close to retail sales, the beach, and residential areas, and is large enough for not only his store but also a processing and production facility. Eager to move forward, he tells Alexa that he will accept her terms. They shake hands on the deal and Kyle gives Alexa a check as a deposit.
All this sounds pretty complicated to Kyle and he is growing nervous about this deal. His knowledge is in growing, processing, and marketing produce, not real estate transactions and land transfers. Knowing that you are (successfully?) completing BL 240 and have studied land-use control, environmental law, and real property, Kyle turns to you for counsel. He is also concerned about any other problems that he should consider in this transaction or relating to the construction of the new business location. Kyle also mentions that a customer of United Nutrition Associates (UNA—recall WA2) is complaining that his holiday variety pack did not provide the health benefits that she would expect from organically grown produce. The family has filed a complaint with the federal government and is now threatening a lawsuit. Kyle wants to know what the legal issues are and how he should respond. What are the issues that must be addressed and what is the controlling law for each issue?
To help you organize your thoughts, I suggest that you read the fact set; decide which facts are relevant and which are merely verbiage; based on the information in Unit 4; decide which legal information is relevant to the facts; then state the legal issue, state the general rule of law that applies to that legal issue, apply the law to the facts, and go to the next legal issue.