Lanny, the owner of Whiteacre in fee simple, leased Whiteacre to Teri for a term of ten years by properly executed written instrument. The lease was promptly and properly recorded. It contained an option for Teri to purchase Whiteacre by tendering $250,000 as purchase price any time "during the term of this lease." One year later, Teri, by a properly executed written instrument, purported to assign the option to Oscar, expressly retaining all of the remaining term of the lease. The instrument of remaining term of the lease. The instrument of assignment was promptly and properly recorded. Two years later, Lanny contracted to sell Whiteacre to Jones and to convey a marketable title "subject to the rights of Teri under her lease." Jones refused to close because of the outstanding option assigned to Oscar. Lanny brought an appropriate action against Jones for specific performance. If judgment is rendered in favor of Lanny, it will be because the relevant jurisdiction has adopted a rule on a key issue as to which various state courts have split. Which of the following identifies the determinative rule or doctrine upon which the split occurs, and states the position favorable to Lanny? 
In a contract to buy, any form of "subject to a lease" clause that fails to mention expressly an existing option means that the seller is agreeing to sell free and clear of any option originally included in the lease.  Marketable title can be conveyed so long as any outstanding option not mentioned in the purchase contract has not yet been exercised. Options to purchase by lessees are subject to the Rule Against Perpetuities. Options to purchase contained in a lease cannot be assigned separately from the lease.
Question: Lanny, the owner of Whiteacre in fee simple, leased Whiteacre to Teri for a term of ten years by properly executed written instrument. The lease was promptly and properly recorded. It contained an option for Teri to purchase Whiteacre by tendering $250,000 as purchase price any time "during the term of this lease." One year later, Teri, by a properly executed written instrument, purported to assign the option to Oscar, expressly retaining all of the remaining term of the lease. The instrument of remaining term of the lease. The instrument of assignment was promptly and properly recorded. Two years later, Lanny contracted to sell Whiteacre to Jones and to convey a marketable title "subject to the rights of Teri under her lease." Jones refused to close because of the outstanding option assigned to Oscar. Lanny brought an appropriate action against Jones for specific performance. If judgment is rendered in favor of Lanny, it will be because the relevant jurisdiction has adopted a rule on a key issue as to which various state courts have split. Which of the following identifies the determinative rule or doctrine upon which the split occurs, and states the position favorable to Lanny? 
A. In a contract to buy, any form of "subject to a lease" clause that fails to mention expressly an existing option means that the seller is agreeing to sell free and clear of any option originally included in the lease. 
B. Marketable title can be conveyed so long as any outstanding option not mentioned in the purchase contract has not yet been exercised.
C. Options to purchase by lessees are subject to the Rule Against Perpetuities.
D. Options to purchase contained in a lease cannot be assigned separately from the lease.
Answer: