Right of first refusal agreements are everywhere in Texas real estate. A neighbor buys a slice of the family ranch and, in the same deal, buys the right to be asked first if the rest ever goes on the market. A parent gives the child who actually works the land the right to match any outside offer. Business partners use them to keep strangers out of jointly held property. They are cheap to draft, easy to record, and almost always sit untouched for years.
Then the owner dies, or moves the land into a trust, and the property starts moving. Trust to buyer, buyer to LLC, LLC to an investor. By the time the person holding the right of first refusal hears about any of it, the land has changed hands two or three times and nobody ever sent the notice the contract required. The natural assumption is that the holder is the injured party and time is on his side. It usually is not. The deadline in the contract still runs, and it can run out while the holder is still gathering facts.
The Austin Court of Appeals addressed this in Donnan v. Estes, No. 03-24-00420-CV (Tex. App.—Austin June 4, 2026) (mem. op.). A trust sold land subject to a right of first refusal without telling the holders. The holders found out, their lawyer said out loud that they wanted to buy, and they lost anyway. The court had to decide when the clock starts after a sale that was never supposed to happen, and whether telling the other side’s lawyer on the phone that you want to buy is enough.
Facts & Procedural History
In 2006, Luke De Lange bought a 79.48-acre tract in Bell County. In January 2008 he sold about 15 of those acres to James C. and Treasa Lynn Donnan. In a separate deal, he sold the Donnans a right of first refusal covering roughly fifty-five of the acres he kept.
The contract spelled out exactly what De Lange had to do if an offer came in. If he received a bona fide third-party offer in the form of a contract of sale and he was willing to accept it, he had to first offer the property to the Donnans on the same terms. That “Owner Offer” had to be in writing and had to include a copy of the third-party contract. The third-party contract, in turn, had to show the purchase price, the finance terms, provisions for closing costs and a title commitment, the closing date, and any other material terms.
The Donnans then had thirty days after delivery of the Owner Offer to notify De Lange in writing whether they were buying, and the contract said they did that by executing the Owner Offer. The contract also said what happened if they missed the window: the right “shall lapse,” and the owner could sell to the third party on the third party’s terms.
In February 2009, De Lange moved the burdened tract to himself as trustee of his family trust. Everyone agreed that internal transfer did not trigger the thirty-day deadline, because De Lange was not selling to anybody. In January 2020, though, the trust sold the tract to T. Carroll and Annette Estes. The Esteses immediately conveyed it to Estes Investments, LLC–Series 8, an entity they controlled. In February 2021, that entity sold ten acres to RTJ Capital Group, LLC and kept the rest. The Donnans say they were never given notice of the sale out of the trust.
The Donnans eventually found out and their lawyers started talking to the lawyers on the other side. This is the date the case turns on: on December 3, 2021, the Estes Parties’ lawyer emailed the Donnans’ lawyer copies of the purchase contract and the settlement statement from the trust’s 2020 sale to the Esteses. RTJ sent similar paperwork on its own purchase in January 2022.
On December 30, 2021 — twenty-seven days after the email, and inside the thirty-day window — the Donnans’ attorney told the Estes Parties’ attorney on the phone that the Donnans intended to exercise the right and buy the property. That statement never went into writing. The Estes Parties’ attorney answered that “he did not believe that a sale to the Donnans was an option.” The next written communication from the Donnans was the lawsuit itself, filed March 25, 2022.
The Donnans sued three sets of defendants for specific performance: the Estes Parties, the De Lange trust and its representatives, and RTJ. RTJ won summary judgment first, on the ground that the Donnans had waived the right by not exercising it within thirty days. That claim was severed and appealed, and the Amarillo Court of Appeals affirmed. See Donnan v. RTJ Cap. Grp., LLC, No. 07-23-00360-CV, 2024 WL 3614748 (Tex. App.—Amarillo July 31, 2024, pet. denied) (mem. op.). The Texas Supreme Court denied review in October 2025. The Estes Parties then filed essentially the same motion, the trial court granted it, and the Donnans appealed that judgment to Austin. The Austin court affirmed.
How a Right of First Refusal Works, and What Happens When the Owner Sells Anyway
To see why the Donnans lost, you first have to understand what a right of first refusal actually is, because it is not what most people assume.
The Texas Supreme Court describes it this way: “A right of first refusal, also known as a preemptive or preferential right, empowers its holder with a preferential right to purchase the subject property on the same terms offered by or to a bona fide purchaser.” Archer v. Tregellas, 566 S.W.3d 281, 286–87 (Tex. 2018). Note what that does not say. It is not an ownership interest in the land. It is not an option the holder can exercise whenever he likes. It is a contract right that sits dormant until a triggering event happens — normally, the owner getting an offer he wants to take. Only then does the holder get a right to buy, and only on the terms the outsider offered.
Selling the burdened property to a third party without offering it to the holder first is a breach of contract. Id. at 287. And the buyer does not necessarily get to keep the land: a purchaser who takes with actual or constructive notice of a right of first refusal takes subject to it, and “stands in the shoes of the original seller when specific performance is sought.” Id. (quoting Jarvis v. Peltier, 400 S.W.3d 644, 653 (Tex. App.—Tyler 2013, pet. denied)). That is the rule the Donnans were counting on, and it is a real rule.
Here is the part that sank them. Texas settled decades ago what a bad sale does to the holder’s deadline, and the answer is that it starts it. In Martin v. Lott, 482 S.W.2d 917 (Tex. App.—Dallas 1972, no writ), the court held that when an owner declares an intention to sell, the holder must elect to buy or to decline — and “[a] transfer in violation of the pre-emptive right is equivalent to such a declaration.” Id. at 922. The wrongful sale stands in for the offer the owner should have made. It does not excuse the holder from responding; it is the thing he has to respond to.
The Austin Court of Appeals had already applied that rule in A.G.E., Inc. v. Buford, 105 S.W.3d 667 (Tex. App.—Austin 2003, pet. denied), holding that “[w]hen the rightholder learns of a sale in violation of her right, she again has the opportunity to either accept or reject within the specified time frame, just as if the offer to buy had been properly noticed.” Id. at 673. Tyler agreed in Jarvis, holding that after learning of a violative sale the holder must elect to purchase or decline “within the time frame specified in the contract creating the right of first refusal.” 400 S.W.3d at 652. And in the Donnans’ own companion appeal, Amarillo said the same thing in plain terms: once the preferential right matured into an enforceable option, it was on the Donnans to exercise it inside the thirty days the contract gave them.
Put those pieces together and the practical rule is uncomfortable but clear. The owner’s breach hands the holder a right to buy. It does not hand the holder unlimited time. The contract’s own deadline attaches to that right, and if the holder lets it run, the right lapses — the same way it would have lapsed if the owner had done everything correctly. Our own Houston court of appeals has said the underlying principle about as bluntly as it can be said: “If an option contract requires the option holder to give notice of his intent to exercise the option, he must timely give this notice; the failure to give it on time is fatal.” Comeaux v. Suderman, 93 S.W.3d 215, 220 (Tex. App.—Houston [14th Dist.] 2002, no pet.).
What the Court Decided and Why
The Donnans made three arguments on appeal. The court rejected all three, and the reasoning is worth walking through because each one is the argument a holder in this position instinctively wants to make.
First: the December 3 email was not an “offer,” so it could not start the clock. The contract called for an “Owner Offer” in writing with a copy of the third-party contract attached. What the Donnans got was a lawyer forwarding a closed deal. The court’s answer was that after the property is already sold, nobody can make a true offer to sell it in the future, so demanding one is asking for the impossible. Under Martin and its successors, notice of the violative sale is the equivalent of the offer the owner failed to make, and it puts the holder in the same position a proper offer would have.
That does not mean any scrap of information will do. The court was careful here: to trigger the holder’s duty to act, the holder must get either the information the contract specifies or, measured against that contract, reasonable information about the sale. The contract still governs how much is enough. So the court went down the list. The email was in writing. It included the actual purchase contract. Between the contract and the settlement statement, the Donnans had the purchase price, the finance terms, the closing costs, and the title commitment fees. The only listed item missing was a closing date, and because the sale had already closed, its absence was immaterial. The Donnans could not point to any other material term they should have received and did not. For all practical purposes, they had everything the contract would have given them.
Second: whether that information was “reasonable” is a fact question for a jury. Often it would be. But the court cited Freeport-McMoRan Oil & Gas LLC v. 1776 Energy Partners, LLC, 672 S.W.3d 391, 399 (Tex. 2023), for the rule that reasonableness becomes a question of law “when from the facts in evidence but one rational inference can be drawn.” Given that the Donnans received substantively everything the contract required, only one inference was available. The court held as a matter of law that the December 3, 2021 disclosure was reasonable notice and started the thirty-day clock, which meant the Donnans had until early January 2022 to accept or decline in writing.
Third: they did exercise the right, orally, on December 30. This is the argument that hurts, because on the timing they were right — the call was inside the window, and their lawyer said plainly that they wanted to buy. The court disposed of it in a sentence’s worth of logic. The contract expressly required the Donnans to exercise in writing, by executing the Owner Offer. An oral statement, no matter how clear, timely, or well documented, could not be an exercise of a right the contract said had to be exercised on paper. The Donnans’ next writing was the lawsuit, filed in March — long past the deadline.
The Donnans also argued that the other lawyer’s response — that he “did not believe that a sale to the Donnans was an option” — was a refusal to perform that excused them from doing anything further. The court said the timing defeated it. The Donnans had not yet exercised their right in writing, so the Estes Parties had no duty to sell them anything yet. A vague remark made before the right was ever properly exercised cannot repudiate an obligation that does not exist. And the court noted the Donnans never exercised within thirty days of learning about the separate RTJ sale either, which undercut any suggestion that better information would have changed their behavior.
Because the evidence conclusively showed the Donnans’ rights lapsed before they acted, summary judgment for the Estes Parties was proper, and the court affirmed.
The Takeaway
Donnan is a warning aimed at two different people, and both of them show up constantly in probate and trust work.
If you hold a right of first refusal and you discover the property was already sold, your clock is probably already running. The moment you receive the closing paperwork — often just an email from the other side’s lawyer — you are on the contract’s deadline, and thirty days is not much time to get title reviewed, financing lined up, and a written exercise delivered. Do not spend that window negotiating, investigating, or waiting for a better explanation. Exercise in writing, exactly the way the contract says, and sort out the fight afterward. If the contract says you exercise by signing something, sign it and deliver it. An email from your lawyer saying your client intends to buy is not the same document, and a phone call is worth nothing at all. Resistance from the other side does not extend your deadline; it is a reason to move faster, not slower.
If you are a trustee, executor, or administrator holding real property, find out before you sell whether anything burdens it. A right of first refusal from fifteen years ago does not expire because the land moved into a trust, and it binds you exactly as it bound the person who signed it. Moving property to yourself as trustee is generally not a triggering sale, which is what makes this trap so easy to walk into — the transfer that felt like nothing did not start any clock, and then the real sale years later did. Selling in breach is a breach, and a buyer who knew about the right can be ordered to convey the land to somebody else. The Esteses won here on the holder’s missed deadline, not because the sale was clean.
The larger point is that a right of first refusal is a contract, and courts read it as one. The owner’s misconduct did not rewrite the Donnans’ obligations, and their genuine, timely, provable intent to buy did not substitute for the writing their own contract demanded. They wanted the land, they said so in time, and they still lost it.
If you are dealing with a right of first refusal on estate or trust property, a sale that closed without the notice your contract required, or a trustee selling real property you have a claim to, talk with our Houston Probate Attorneys. We help clients work through even the most complex estates. Call today for a free confidential consultation at (281) 317-2449.
Our Houston Probate Litigation Attorneys provide a full range of probate services to our clients, including helping with rights of first refusal, trust and estate real property sales, and specific performance disputes. Affordable rates, fixed fees, and payment plans are available. We provide step-by-step instructions, guidance, checklists, and more for completing the probate process. We have years of combined experience that we can use to support and guide you with probate and estate matters. Call us today for a FREE attorney consultation.
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