Fixed Price Preemptive Rights in California: The Quality of Mercer is Strained

The author explores a conflict in California law pertaining to the validity of fixed price preemptive rights as they apply to the disposition of real property. After analyzing California and other jurisdictions' decisional law concerning fixed price preemptive rights, the author proposes that courts considering the validity of such rights in the future pay special attention to the parity of the parties' bargaining power and the presence of special nonmonetary consideration supporting any proposed fixed price preemptive agreement. The author suggests that, by considering these factors, courts will be better able to distinguish between acceptable fixed price preemptive rights and those which create an unreasonable restraint on alienation.