Lade's Estate, Matter of
| Decision Date | 03 January 1978 |
| Docket Number | No. 75-805,75-805 |
| Citation | 82 Wis.2d 80,260 N.W.2d 665 |
| Parties | In the Matter of the ESTATE of Oscar F. LADE, Deceased. Emma L. JORGENSEN, personal representative of the Estate of Oscar F. Lade, Deceased, Respondent and Cross-Appellant, v. Elwyn KETTER, Appellant and Cross-Respondent. |
| Court | Wisconsin Supreme Court |
This is an action to recover damages in lieu of specific performance of an oral contract to convey real property. The reason that damages were sought is that the property had been sold to an innocent third party. The trial court found that the action was barred by the statute of frauds, but allowed recovery for certain services on the basis of quantum meruit and for breach of a lease agreement. Both parties appeal.
Arthur W. Guenther, Jr., Campbellsport, for appellant and cross-respondent.
Tonjes & Mortensen, Fond du Lac, for respondent and cross-appellant.
The property in question is a farm in Fond du Lac county which was owned by Oscar F. Lade, an elderly man who died intestate on December 22, 1973.
Elwyn Ketter, who owned a farm adjacent to Lade's, was a good friend of the deceased. He had worked part of the Lade farm on a shares basis beginning in 1963, and in 1966 or 1967 became a renter under an oral lease. He was renting twenty-one and one-half acres of Lade's farm at the time of Lade's death.
When Lade died, Ketter filed a claim with the estate for various improvements and services rendered to Lade, for breach of the oral lease for 1974, and for breach of an oral contract by which Lade allegedly agreed to convey his farm to Ketter for $8,000. The trial court found that there was no contract to convey, but rather an option to purchase land and that it was barred by the statute of frauds.
Although trial court findings must be sustained unless contrary to the great weight and clear preponderance of the evidence, it is apparent that the trial court was in error. We conclude that there was a contract to convey but that it was nevertheless barred by the statute of frauds.
When one purchases an option, one obtains the potentiality of conveyance. That was not the case here. The evidence demonstrates that a bargain had been made: Lade offered to sell for $8,000 and Ketter agreed to pay.
This agreement was first reached at a meeting between Lade and Ketter several years prior to Lade's death. Members of the Ketter family were witnesses and testified that Ketter was to pay $8,000 for the farm but that Lade refused to accept any money until after January 1, 1974 because of tax or social security reasons. The existence and terms of the contract are reinforced by the testimony of several other persons, two of whom had attempted to buy the property and were told by Lade that he had sold the property to Elwyn Ketter. However, no written agreement was ever drawn up.
The statute of frauds concerning real estate transactions, sec. 706.02, basically requires that such transactions be evidenced by a conveyance. Sec. 706.01(3), defines a "conveyance" as a written instrument. For a real estate transaction not evidenced by a conveyance to be enforceable, sec. 706.04 requires (1) that the elements of the contract be clearly and satisfactorily proved, and (2) that it fall within one of the exceptions to the statute of frauds enumerated therein. We need not concern ourselves with whether the evidence presented shows the elements of the contract by clear and satisfactory proof because it is apparent that even if proved the contract does not fall within one of the exceptions to the statute of frauds.
Ketter claims that the statutory bar should be lifted because this case falls within the exceptions for unjust enrichment and equitable estoppel.
The unjust enrichment theory is based on sec. 706.04(2), Stats., which states that performance may be ordered if the party against whom enforcement is sought would be unjustly enriched if enforcement is denied.
Ketter's argument is that because the estate sold the property to a third party for $29,500, it has been unjustly enriched to the amount of $21,500, the contract price market price difference. This is not unjust enrichment. For unjust enrichment to apply, the estate of Oscar Lade would have to have received valuable consideration from Ketter: Down payments, full payment, or substantial improvements to the farm. Under unjust enrichment a person is seeking the return of money actually expended; there must be a benefit conferred upon the defendant by the plaintiff. Arjay Investment Co. v. Kohlmetz, 9 Wis.2d 535, 538, 101 N.W.2d 700 (1960); Don Ganser & Associates, Inc. v. MHI, Inc., 31 Wis.2d 212, 216, 142 N.W.2d 781 (1966). Here, Ketter has made no such expenditures or conferred any benefits.
The second exception which Ketter claims is the doctrine of equitable estoppel set forth in sec. 706.04(3)(b), Stats. This section, which closely reflects the doctrine of part performance, will estop a person from asserting the statute of frauds when the person claiming estoppel has changed his position to his substantial detriment, under circumstances in which the detriment incurred cannot be recovered but by specific performance, and where the detriment was incurred with the prior knowing consent or approval of the party sought to be estopped.
Ketter's case for equitable estoppel-part performance is based on personal services to Lade and on improvements made on Lade's farm. Also raised is a claim that he refrained from buying over farmland in reliance on the oral agreement. In examining acts alleged to constitute part performance, only those acts performed after creation of the oral contract may be considered, and those acts must be solely and obviously referable to the contract. Bunbury v. Krauss, 41 Wis.2d 522, 534, 164 N.W.2d 473 (1969); Marshall & Ilsley Bank v. Schuerbrock, 195 Wis. 203, 210, 217 N.W. 416 (1928). Moreover, the facts alleged to remove the bar of the statute of frauds must be clearly and satisfactorily proved. Marshall & Ilsley Bank, 195 Wis. at 211, 217 N.W. 416.
Under these standards all improvements and services made or performed before the contract must be disregarded. The claim that Ketter would have bought other farmland may also be dismissed because it is not supported by clear and satisfactory proof.
Ketter contends that Estate of Powell, 206 Wis. 513, 240 N.W. 122 (1932), presents a situation closely analogous to this one. It does not. The Powell court characterized the acts of the successful claimants as going beyond the requirements of ordinary tenancy and husbandry. Ketter's improvements do not meet this...
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