Tetherow v. Wolfe

• Decision Date: 15 August 1986
• Docket Number: No. 84-892,84-892
• Citation: 223 Neb. 631,392 N.W.2d 374
• Parties: Douglas R. TETHEROW and Mary Ann Tetherow, Personal Representative of the Estate of Donald R. Tetherow, Deceased, Appellees and Cross-Appellants, v. E. Dean WOLFE, Doing Business As Century 21, Wolfe & Associates, Appellant and Cross-Appellee.
• Court: Nebraska Supreme Court

Page 374

392 N.W.2d 374

223 Neb. 631

Douglas R. TETHEROW and Mary Ann Tetherow, Personal Representative of the Estate of Donald R. Tetherow, Deceased, Appellees and Cross-Appellants, v. E. Dean WOLFE, Doing Business As Century 21, Wolfe & Associates, Appellant and Cross-Appellee.

No. 84-892.

Supreme Court of Nebraska.

Aug. 15, 1986.

Syllabus by the Court

1. Directed Verdict. The standard governing a trial judge in assessing a motion for a directed verdict is well established. The judge must resolve every controverted fact in favor of the party against whom the verdict is sought, and must also give that party the benefit of every reasonable inference that can be drawn from the facts in evidence. If there is any evidence which will sustain a finding for the party against whom the motion is made, the case may not be decided as a matter of law.

2. Brokers: Principal and Agent. A real estate broker owes a duty to his employer, the property owner, to use reasonable care, skill, and diligence to bring about the desires of the property owner.

3. Torts: Actions: Damages: Attorney Fees. One who through the tort of another has been required to act in the protection of his interests by bringing or defending an action against a third person is entitled to recover reasonable compensation for loss of time, attorney fees, and other expenditures thereby suffered or incurred in the earlier action.

D. Steven Leininger, of Luebs, Dowding, Beltzer, Leininger, Smith & Busick, Grand Island, for appellant.

Alan H. Kirshen, Omaha, for appellees.

KRIVOSHA, C.J., and BOSLAUGH, WHITE, HASTINGS, CAPORALE, SHANAHAN, and GRANT, JJ.

PER CURIAM.

Douglas R. and Donald R. Tetherow commenced this action in the district court for Cherry County, Nebraska, against the appellant, E. Dean Wolfe, doing business as Century 21, Wolfe & Associates. The cause of action originally owned by Tetherow Bros. & Sons, Inc., a Nebraska corporation, had been assigned to the Tetherows individually as part of the dissolution of the corporation. By the action, Tetherows sought money damages from Wolfe for the alleged negligent action of one of Wolfe's agents in preparing a purchase agreement for the sale of land owned by Tetherow Bros. During the proceedings, Donald Tetherow, one of the brothers, died, and his wife, as personal representative, was substituted as a party plaintiff.

In their petition Tetherows alleged that Tetherow Bros. had retained Wolfe for the purpose of obtaining a buyer of property owned by Tetherow Bros., on condition that the sale be for cash only; that, in fact, Wolfe's agent negligently prepared a contract which was conditioned upon the purchaser's obtaining a loan. Tetherows alleged that it had been specifically inquired of Wolfe's agent whether the contract was not subject to the buyer's obtaining a loan, and were advised by Wolfe's agent that although the form was not the correct form for a cash sale, the contract nevertheless did obligate the purchaser to complete the sale without regard to whether a loan could be obtained and that a correct form could be prepared at a later time. Tetherows further allege that as a result of the statements made to them by Wolfe's agent, they executed the agreement. The petition also alleged that, subsequently, the purchaser refused to complete the purchase on the basis that he could not obtain a loan and therefore demanded return of his downpayment. Tetherows allege that Wolfe's agent was negligent in that he used the wrong form, that he assured the sellers that the form was nevertheless appropriate for the transaction, and that, as a result of the negligence of Wolfe's agent, sellers were injured by reason of the loss of the sale in the amount of $180,906.12, that being the difference between the sale price to E. Max Schmitz of Schmitz, Inc., and the fair market value of the property at the time the sale should have been completed.

Wolfe filed an answer in which he generally admitted the transaction but denied that he or his agent was in any manner negligent, and denied that the sellers had sustained any damages. He further alleged that "the Plaintiffs failed to mitigate their damages." No facts were alleged to support the conclusion. Furthermore, no affirmative defenses such as contributory negligence were pled.

Following trial to a jury, a verdict was returned in favor of Tetherows and against Wolfe in the amount of $95,809.30. On motion by Wolfe, the district court granted Wolfe credit on the judgment in the amount of $12,431.25, that being one-half the amount of the interest earned on the downpayment in the amount of $116,250 held in escrow from the time that the contract of purchase was signed until Tetherows were ordered by the district court for Hall County, Nebraska, to return the downpayment to the purchaser.

The evidence regarding the transaction is virtually without dispute and is established principally by the testimony of Douglas Tetherow. He testified that in 1978 he and his brother, through their corporation, owned certain ranch land on which they conducted a cow-calf operation. The ranch was divided into eight separate tracts. Because of health reasons, the brothers determined that the corporation should sell the property and entered into a listing contract with Wolfe. When the property did not sell under the listing contract, Tetherows arranged to have the property sold at auction. The sale bill provided that the sale was to be a cash sale. The auction was held on December 11, 1979. Seven of the eight tracts sold. Tracts 1, 2, 4, 5, 6, and 7 were bid in by Schmitz for a total price of $775,000. Tract 3 was sold to another party and is not involved in this lawsuit.

Wolfe's agent proceeded to draw up a contract, using a prepared, printed form. The contract specifically provides that it is subject to Schmitz' obtaining a loan from the federal land bank. Douglas Tetherow testified that when the contract was submitted to the Tetherows for their signatures, he questioned whether the contract reflected the understanding of the parties and whether the contract provided unconditionally for a cash sale. Wolfe's agent assured Tetherows that while the form was not the correct form, the sale was an unconditional cash sale and that a proper form could be prepared at a later time. The purchaser paid over $116,250 as a downpayment, which was deposited in an interest-bearing account. Under the terms of the agreement, the interest earned was to be divided equally between the purchaser and sellers.

As already indicated, the purchaser later, being unable to obtain a loan from the federal land bank, refused to complete the sale and filed suit for the return of the downpayment. Following a trial, Tetherows were ordered to return to the purchaser his downpayment. In defending the suit, Tetherows incurred legal expenses in the sum of $7,906.12. During the time that the downpayment was on deposit, it earned interest in the amount of $24,862.50. Although the trial court, in the case between the purchaser, Wolfe, and Tetherows, did not order the payment of interest, Tetherows nevertheless paid one-half of the interest to the purchaser in accordance with their previous agreement. Tetherows then commenced this action against Wolfe for damages allegedly caused by reason of Wolfe's agent's failing to prepare a contract requiring the purchaser to proceed unconditionally and for cash.

Wolfe assigns, essentially, the following errors allegedly committed by the district court: (1) That the evidence was insufficient to sustain the verdict; (2) That the district court erred in failing to instruct on the proper measure of damages, in that the district court refused to instruct the jury on Tetherows' obligation to mitigate damages; (3) That the district court erred in permitting the jury to consider, as an element of damages in the suit against Wolfe, the attorney fees incurred by Tetherows in the earlier suit brought by the purchaser; and (4) That the district court erred in failing to credit Wolfe with all of the interest earned on the downpayment, rather than just half of the interest. Tetherows cross-appealed, maintaining that the district court erred in granting Wolfe any credit for the interest earned.

Our review of the record leads us to the conclusion that the assignments of error raised by Wolfe are without merit and that the verdict, as rendered by the jury, should in all respects be upheld. We further find that the district court erred in granting Wolfe any credit on the interest earned on the downpayment, and must reverse that portion of the judgment.

Turning first to the question of the sufficiency of the evidence, we believe that the evidence was sufficient to raise a question of fact which had to be submitted to the jury. For that reason the district court did not err in refusing to sustain Wolfe's motion for directed verdict. As we recently have held in Sierks v. Delk, 222 Neb. 360, 363, 383 N.W.2d 778, 779 (1986):

The standard governing a trial judge in assessing a motion for a directed verdict is well established. The judge must resolve every controverted fact in favor of the party against whom the verdict is sought, and must also give that party the benefit of every reasonable inference that can be drawn from the facts in evidence. If there is any evidence...