Waste Connections of Kansas v. Ritchie Corp.

A waste-management company contracted with Ritchie Corporation (defendant) to use a piece of Ritchie’s property as a waste-transfer station. The contract also contained a right of first refusal stating that if Ritchie received an acceptable third-party offer to buy the property, the transfer-station operator could buy the property by matching the offered price. Waste Connections of Kansas, Inc. (Waste Connections) (plaintiff) bought the original waste-management company’s rights to the contract and operated the station. Later, Ritchie entered into a purchase agreement with Cornejo & Sons (Cornejo). This agreement stated that (1) Cornejo agreed to buy both the transfer station and a landfill for $4.95 million, (2) $2 million of that price was for the transfer station and $2.95 million for the landfill, and (3) if Waste Connections decided to buy the transfer station, Cornejo would buy only the landfill for $3.5 million. Ritchie notified Waste Connections that it had been offered $2 million for the transfer station. Waste Connections responded that it was exercising its contractual right of first refusal. However, Waste Connections believed that the offered price was the difference between the package price and the landfill-only sale, which was $1.45 million. Waste Connections filed a declaratory-judgment action asking the court to determine the transfer station’s correct price. The district court granted summary judgment for Ritchie, finding that the price was $2 million. The appellate court reversed and held that the price was $1.45 million. The Kansas Supreme Court agreed to review the case.