Rice v. Reich

Decision Date04 May 1971
Docket NumberNo. 284,284
Citation186 N.W.2d 269,51 Wis.2d 205
PartiesRichard M. RICE et al., Appellants, v. Fred R. REICH, d/b/a Reich Realty Co., et al., Respondents.
CourtWisconsin Supreme Court

This is an action for the return of earnest money to the plaintiffs, husband and wife (hereinafter the purchasers), who, on or about September 28, 1968, signed an offer to purchase certain premises in the city of Oconomowoc owned by the defendants, Frank and Ruth Berns (hereinafter the sellers) for a price of $52,500. The offer was submitted through defendant Reich, a real estate broker representing the sellers; the purchasers, on submitting their offer, paying Reich $1,000 as an earnest-money deposit to be held in trust by him. The sellers accepted the offer on October 3, 1968.

The contract was the familiar standard offer to purchase and acceptance. It provided, inter alia, (1) that the sellers were to 'convey the property * * * free and clear of all liens and encumbrances * * *' excepting the usual municipal and zoning ordinances, recorded public utility easements and recorded building restrictions; and (2) that in the event the sellers could not deliver title free of valid title defects, the buyer might, at his option, recover all money paid under the agreement.

The premises consisted of a six-unit apartment building and lot fronting on North Lake Road in Oconomowoc and extending westerly to Lac La Belle. The abstract disclosed that the property was subject to a recorded easement granted to the adjoining property on the north across a portion of the real estate here involved. This easement was designated a 'lease' and was granted in 1902 for a period of ninety-nine years, and consisted of a driveway which was jointly used by the two properties. It was not specifically excepted on the written offer to purchase and acceptance.

At trial, Reich, the defendant-broker, testified that he showed the property to the purchasers on or about September 25, 1968, at which time they walked on the driveway and he informed them of the driveway easement and that the driveway was jointly used. Further, the purchasers observed the driveway and the presence of garages on the adjoining property at the end of the driveway.

Rice testified that he did not remember the details of the showing.

The trial court found that the purchasers were aware of the joint use of the driveway. The court entered judgment for the defendants.

William J. Keating, Milwaukee, for appellants.

Herro, Snyder, Chapman & Snyder, Oconomowoc, for respondents.

WILKIE, Justice.

The only issue presented on this appeal is whether, if the purchasers had knowledge of the joint-driveway easement at the time they executed the offer to purchase, they are precluded from raising any objection to the encumbrance and barred from recovering their $1,000 earnest-money payment. We conclude that they are. The case is controlled by Taxman v. McMahan. 1 In Taxman this court stated:

'Wisconsin early recognized an exception to the foregoing rule, namely, that an easement which is fully known to a purchaser before he makes his contract of purchase, or which is so open, obvious, and notorious that he must have known of it, is not an incumbrnace within the meaning of such a covenant.' 2

The question of whether purchasers here knew of the easement is a question of fact to be settled by the trial court , and it was here resolved against them. The record amply supports the finding made. Defendant Reich testified that the purchasers walked on the driveway and that he informed them of the use made of it by the adjoining property. Purchasers testified that they could not remember whether they were so informed. In addition, Mr. Rice was a lawyer with thirty years' experience and the trial court was clearly entitled to infer that he was aware of the law. The finding of the court that the plaintiffs knew of the joint-driveway easement at the time they executed the offer to purchase is not against the great weight and clear preponderance of the evidence.

Appellants argue that the joint-driveway 'lease' is not an easement, as in Taxman, and the cases cited therein, but is a '99-year lease.' Hence, the rule of Taxman does not apply.

But it is well settled that the name which parties give to an agreement does not control the interpretation of it. 3 Courts will look to the essential nature of the agreement or property right. Here, the joint driveway agreement was an easement not a lease no matter what it was called. 'A rose by any other name would smell as sweet.' Taxman involved a party wall and two other easements...

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9 cases
  • Don-Rick, Inc. v. Americas
    • United States
    • U.S. District Court — Western District of Wisconsin
    • 3 Febrero 2014
    ...Wisconsin long has held that parties' characterizations or labels of a document are not controlling. See, e.g., Rice v. Reich, 51 Wis.2d 205, 208, 186 N.W.2d 269, 271 (1971) (document entitled “joint driveway agreement” was actually an easement and not a lease); M & I First Nat'l Bank v. Ep......
  • Lacosse v. Wergin, 92-1475
    • United States
    • Wisconsin Court of Appeals
    • 31 Marzo 1993
    ...of authority which is not usually associated with the limited use contemplated by a conventional easement. Cf. Rice v. Reich, 51 Wis.2d 205, 209, 186 N.W.2d 269, 272 (1971); Taxman v. McMahan, 21 Wis.2d 215, 216, 124 N.W.2d 68, 69 (1963). These considerations support the trial court's deter......
  • Philip Mnuk v. Harmony Homes Inc., 2009AP1178.
    • United States
    • Wisconsin Court of Appeals
    • 29 Julio 2010
    ...446-47, 249 N.W.2d 543 (1977) (A document granting a property interest was an easement, regardless of form.). See also Rice v. Reich, 51 Wis.2d 205, 208, 186 N.W.2d 269 (1971) (An easement called a “lease” is still an easement because courts look to the essential nature of the agreement or ......
  • Golf Resorts, Inc. v. Peshak, 91-2251
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • 19 Julio 1993
    ..."it is well settled that the name which parties give to an agreement does not control the interpretation of it." Rice v. Reich, 51 Wis.2d 205, 208, 186 N.W.2d 269, 271 (1971). [T]he cornerstone of contract construction is to ascertain the true intentions of the parties as expressed by the c......
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