Rimling v. Scherper

• Decision Date: 12 January 1932
• Citation: 206 Wis. 532,240 N.W. 159
• Parties: RIMLING v. SCHERPER ET AL.
• Court: Wisconsin Supreme Court

206 Wis. 532

240 N.W. 159

RIMLING

v.SCHERPER ET AL.

Supreme Court of Wisconsin.

Jan. 12, 1932.

Appeal from a judgment of the Circuit Court for Milwaukee County; Edward T. Fairchild, Circuit Judge.

Suit by Clarence H. Rimling against Sam Scherper and others. From the judgment, plaintiff appeals, and the named defendant and another cross-appeal.--[By Editorial Staff.]

This action was commenced on the 19th day of December, 1928, to rescind a certain contract entered into by the plaintiff and the defendants Scherper and Grifka, hereinafter called the defendants, on the 17th day of October, 1928, whereby the plaintiff agreed to buy from said defendants two apartment buildings, title to which was in the name of Dell Realty Company, hereinafter called the company, and for resulting damages.

The Dell Realty Company is a corporation and, at all times material to this controversy, one Goodsitt was its president and one Hartsman was its secretary. It was engaged in the real estate business and owned several apartment buildings which it had built to rent or sell. Defendant Scherper was a real estate broker, and defendant Grifka seems to have been engaged in the business of selling diamonds and occasionally dealing in real estate. Some time prior to October 1, 1928, two apartment buildings belonging to the company were on the market for sale (at least, the company was willing to sell them). Grifka testified that he had an option to buy them prior to the 15th day of October, 1928, when the agency or option contract, around which the controversy involved in this appeal largely centers, was entered into by the company and Grifka. For about eight years prior to October 17, 1928, Rimling, the plaintiff, had been engaged in the retail hardware business in the city of Milwaukee. His wife had assisted him in conducting the business. Shortly before the deal, out of which this controversy arose, was entered into, the plaintiff had practically decided to retire from the hardware business and was seemingly desirous of disposing of his stock of hardware and certain furniture belonging to him, in trade for an apartment building or buildings. He desired to acquire such an investment so that both he and his wife might have an opportunity to live a more leisurely life. About October 1st of the year mentioned, he met Scherper on a certain Sunday and advised the latter of his desire to trade his stock and furniture for an apartment building. Scherper told the plaintiff of several properties which he had listed for sale. These were later shown to the plaintiff, but he was apparently not interested in any of them. Some time during the week following, Scherper learned from Grifka that two apartment buildings belonging to the company were for sale and could be purchased, subject to existing mortgages thereon, on fairly easy terms. Shortly thereafter Scherper told Rimling of these apartment buildings and exhibited them to him, his wife, and his father-in-law. When these apartments were first shown to Rimling, Scherper did not know the price for which they could be purchased, but later advised Rimling that the price was $68,000 for each building, or $136,000 for both; that the price mentioned was the cost price; that the officers of the Dell Realty Company were fighting; that they transacted no business between themselves except through their attorneys; and that a sale of the buildings was desired so that the company might liquidate its assets and dissolve the corporation. There is every indication from the evidence that Rimling was desirous of acquiring these buildings at the price mentioned providing he could trade or dispose of his stock and furniture on some satisfactory basis. Numerous interviews were had between the defendants and Rimling. Rimling evidently was considered a good prospect by both defendants, and the evidence clearly permits of the inference that for a number of days prior to October 15 defendants had a working arrangement and understanding as to a division of the profits in case a deal went through. Both defendants testified that at the time the contract was entered into with the plaintiff they considered themselves as partners in the deal. On October 8th Rimling signed and delivered to Scherper the following agreement:

“I Clarence H. Rimling agree to pay Sam Scherper Real Estate Broker $1000 Commission to trade my stock Fixtures and 4 apts. on 87 Howell Ave. on 24 apts. on Newton and Oakland Ave. Price $136,000.00.

[Signed] Clarence H. Rimling.”

He, at that time, gave to Scherper his check for $250. On October 15th Grifka obtained from the company the following agreement:

“Memorandum of Agreement made this 15th day of October, 1928, between the Dell Realty Company, party of the first part, and Henry Grifka, party of the second part.

Party of the first part agrees to sell the premises known as 371 and 367 Newton Avenue, Shorewood, Wis., for the sum of Sixty Thousand Dollars ($60,000.00) net per building to any customer that party of the second part may bring within the next ten days on the following conditions:

Party of the first part agrees to take back mortgages of not more than Five Thousand ($5,000.00) Dollars, per building upon which the buyer must agree to make payments per month of not less than Seventy-five ($75.00) Dollars on each mortgage and interest at 6% payable monthly, in advance. Said mortgage is to be for a period of not longer than five years.

Buyer must assume the first and second mortgages on the buildings and all special assessments beginning with the year 1929. Insurance and taxes are to be adjusted as of the date of the sale.

In consideration of the efforts made by the party of the second part to sell said buildings, and for one dollar ($1.00) and other good and valuable consideration, said option is given exclusively for a period of ten days and is under no consideration to be for a longer period.

It is expressly understood between the parties that said price of Sixty Thousand Dollars ($60,000.00) per building is net and no payment of commission is to be made.

Dell Realty Company

By M. Goodsitt,

+---------------------------+
                ¦Dora Goodsitt. ¦President.”¦
                +---------------------------+
                

This agreement was subsequently extended for five days by an indorsement upon the contract.

It may be here noted that the foregoing contract is claimed by the plaintiff to be an agency contract, while the defendants and the company claim it to be merely an option. After Grifka obtained this contract, both he and Scherper called on the plaintiff and, on the 17th day of October, after several hours of negotiations, induced the plaintiff to enter into a contract for the purchase of the two buildings. So much of the contract as is necessary to an understanding of this controversy is as follows:

“Agreement made this 17th day of October, 1928, by and between Henry Grifka and Sam Scherper, parties of the first part, as agents of the Dell Realty Co., and Clarence H. Rimling, party of the second part, hereinafter called the purchaser. * * *

“The parties of the first part agree as agents of the Dell Realty Co., to sell and convey two buildings to the party of the second part, (describing them). * * *

“The party of the second part agrees to purchase from the Dell Realty Co., through the parties of the first part, the above described premises under the following conditions:

“The purchase price of said buildings is to be the sum of $68,000 per building, etc.

“The party of the second part agrees to assume the existing mortgages upon both buildings amounting to approximately $87,000 and also a further or third mortgage of $10,000.

“The purchaser further agrees to make payments,” etc.

“The parties of the first part agree to take as part of the purchase price, the goods, wares, and merchandise which are located in the hardware store owned by the purchaser and situated at 87 Howell Avenue, in the city and county of Milwaukee, Wisconsin, and also all fixtures, tools, and furniture contained in three (3) apartments located at the above address and owned by the purchaser.

The inventory of said goods, wares and merchandise shall be figured at cost and shall amount to a sum not exceeding $23,500. In the event that the inventory of said goods, wares and merchandise shall not amount to the agreed sum of $23,500 then the deficit shall be paid in cash by the purchaser to the parties of the first part.

For all the said goods, wares and merchandise and fixtures, tools, and furniture above mentioned, the sum of $26,000 shall be credited against the purchase price of $136,000.00. * * *

[Signed] Clarence H. Rimling

Sam Scherper

Henry Grifka”

Reverse side of page:

“It is further agreed and understood between the parties to this contract that in the event that the parties of the first part shall receive for the sale of this stock and Fixtures an amount in excess of $21,500 the party of the second part shall be credited with all such money on the final settlement on the purchase price.

Sam Scherper

Henry Grifka.”

Several days before the foregoing contract was entered into, the officers of the Dell Realty Company were importuned to look over plaintiff's stock of merchandise which was exhibited to Goodsitt and Hartsman by the defendants with the hope that the company might take over the stock in part payment of the purchase price of the buildings. It is undisputed that Mr. Hartsman, who rather carefully looked over the stock (Mr. Goodsitt being too ill to remain in the store for more than a few minutes), positively stated to the defendants and to Rimling that the company was in no way interested in taking over the stock in part payment of the purchase price of the apartment buildings. Mr. Rimling clearly understood that the realty company was in no wise interested in taking over the stock on any deal for the buildings. He unquestionably knew when he entered into the contract with the defendants on October 17th, that at least so much...