Fond du Lac Plaza, Inc. v. H. C. Prange Co.

• Decision Date: 26 June 1970
• Docket Number: No. 314,314
• Parties: FOND DU LAC PLAZA, INC., a corporation, Plaintiff-Respondent, v. H. C. PRANGE CO., a corporation, et al., Defendant-Appellants, Archie Reid, Jr., et al., Defendants.
• Court: Wisconsin Supreme Court

Page 67

178 N.W.2d 67

47 Wis.2d 593

FOND DU LAC PLAZA, INC., a corporation, Plaintiff-Respondent, v. H. C. PRANGE CO., a corporation, et al., Defendant-Appellants, Archie Reid, Jr., et al., Defendants.

No. 314.

Supreme Court of Wisconsin.

June 26, 1970.

This case raises the single question of the proper venue of an action for specific performance of a contract. The plaintiff Fond du Lac Plaza, Inc. (Plaza) brought this suit in Rock county on an instrument entitled an 'Option to Lease' covering lands in Fond du Lac county. The defendants Archie Reid, Jr. and Hattie Reid (Reids), who are residents of Rock county, owned the land in question and gave the written option to the assignor of Plaza. The defendant H. C. Prange Company (Prange) and its assignee Budget Center, Inc. (Budget) are alleged to have purchased from the Reids during the option period a portion of the land covered by the option. These defendants demurred to the complaint on the ground the suit should have been commenced in Fond du Lac county. From the order overruling their demurrer, Prange and Budget appeal.

James P. Brody, Maurice J. McSweeney, Foley p Lardner, Milwaukee, Robert L. Rohde, Federer, Grote, Hesslink, Rohde & Neuses, Sheboygan, for appellants.

Prazak & Geffs, Clinton, for defendants.

Whyte, Hirschboeck, Minahan, Harding & Harland, Milwaukee, for respondent; Victor M. Harding and Anthony W. Asmuth, III, Milwaukee, of counsel.

HALLOWS, Chief Justice.

This case is controlled by the reasoning in State v. Conway (1965), 26 Wis.2d 410, 132 N.W.2d 539, and the order should be affirmed. The complaint alleges that in June, 1965, Reids entered into an option agreement to lease certain real estate owned by them in Fond du Lac county to Melvin Simon and Associates, Inc. The option provided that the optionees could lease the property, which consisted of about 70 acres, for an initial term of 55 years with the right to an extended additional term of 50 years. The term of the option within which the option could be exercised was an initial period of 180 days; and the option provided that period could be extended for an additional 160 days upon the payment of $1,500 prior to the expiration of the initial period. During the initial period, it is alleged the Reids conveyed a portion of the property, some two acres, to Prange, who in turn conveyed to Budget. It is further alleged both Prange and Budget 'had full knowledge or reasonably should have known of the existence of the option to lease.'

On October 30th, 1965, about a month after this conveyance, Melvin Simon and Associates, Inc. assigned the option to Plaza who, on December 11, 1965, and prior to the expiration of the initial option period, tendered to the Reids the sum of $1,500 for the purpose of extending the option period, but the Reids refused to accept the tender. By way of relief, the complaint prays the conveyance from the Reids to Prange and Budget be set aside and declared void, Prange and Budget be enjoined from taking possession of the property, and the Reids required to specifically observe and perform the option to lease. In addition, damages are requested. While this matter was under advisement by the trial court, Plaza by letter withdrew from the prayer for relief its request to have the deeds to Prange and Budget declared void, and these defendants claim that such information is de hors the record on this appeal.

It may be the complaint leaves something to be desired because it does not allege that Plaza has exercised the option so that a binding contract to make a lease or to lease the property is in existence. The only breach alleged is the refusal to accept the tender to extend the option period which period has now long expired. However, this case has been argued on the basis that Plaza has an agreement to lease the property and Reids have refused to lease such property and have sold part of it to Prange and Budget. For the purpose of deciding the question of venue, we will assume these facts in order to determine the nature of the cause of action and whether sec. 261.01(1)(a), Stats., ¹ requires this suit to be brought in the county in which the land is situated. We think sec. 261.01(1)(a) was intended to apply to suits which subject real estate or an interest therein to the jurisdiction and direct control of the court; and conversely, a suit although involving or concerned with real property indirectly is not subject to the section when the main object and nature of the suit is not to directly affect title to land by force of a decree of the court. In State v. Conway, supra, we recognized the well-established rule in equity that a suit for specific performance to convey land did not have to be brought in the county in which the land is situated but could be brought under sec. 261.01(12) in the county of the defendant's residence. It is argued that Conway should be restricted to its facts and distinguished on the ground the suit was between the immediate parties to the contract of purchase while here the suit is against not only the parties to the option but also against non-parties and subsequent purchasers. We see no validity in this distinction if the nature of this suit for specific performance is in personam. As we analyze the complaint, this suit seeks a decree ordering the Reids to lease the land and to enjoin Prange and Budget from interfering with Plaza's possession. The decree would not act directly on the land but on the parties. What the rights are between Prange and Budget and the Reids subject to the lease are not before us. Of course, in determining Plaza's rights to an injunction, their rights as against Prange and Budget will have to be determined. But this factor in the context of a specific performance action is not determinative that sec. 261.01(1)(a) applies.

One of the principal factors in determining the venue of an action for specific performance of a contract pertaining to real estate is the nature of the suit in question. For venue purposes, the character of the...