For a land sale option, which statement is true?

• A. The option rights are valid between the parties who created them even without recording.
• B. The option's rights require recording to be enforceable.
• C. The option automatically binds third parties.
• D. The option terminates on grantor's death.

Answer: (A)

The key idea is that an option to purchase real property creates a contractual right between the person who grants the option and the person who holds it, and that right remains enforceable between those two parties even if it isn’t recorded. Recording mainly serves to give notice to later buyers; without recording, a subsequent purchaser for value without notice can take the land free of the option. The option is not automatically binding on third parties, and it does not automatically terminate upon the grantor’s death unless the contract itself provides such a term. Therefore, the statement that the option rights are valid between the parties who created them even without recording is the correct one.