Vasichek v. Thorsen, 9455

• Decision Date: 31 October 1978
• Docket Number: No. 9455,9455
• Parties: James T. VASICHEK and Norma M. Vasichek, Plaintiffs and Appellees, v. James D. THORSEN, Individually and as Executor of the Estate of John Thorsen, Deceased, Defendant and Appellant, and Marleen Marie Carroll and Carolyn Rae Cook, Defendants. Civ.
• Court: North Dakota Supreme Court

Page 555

271 N.W.2d 555

James T. VASICHEK and Norma M. Vasichek, Plaintiffs and Appellees, v. James D. THORSEN, Individually and as Executor of the Estate of John Thorsen, Deceased, Defendant and Appellant and Marleen Marie Carroll and Carolyn Rae Cook, Defendants.

Civ. No. 9455.

Supreme Court of North Dakota.

Oct. 31, 1978.

Degnan, McElroy, Lamb, Camrud, Maddock & Olson, Grand Forks, for plaintiffs and appellees; argued by James L. Lamb, Grand Forks.

R. Lee Hamilton, Grand Forks, for defendant and appellant.

John E. Widdel, Jr., Grand Forks, for defendants.

PEDERSON, Justice.

This is an appeal by James D. Thorsen from the judgment entered upon a verdict in favor of James T. Vasichek and Norma M. Vasichek, and from a denial of a motion for judgment notwithstanding the verdict or a new trial. We affirm the judgment and the order denying the motion.

In October 1971, the Vasicheks negotiated with James Thorsen for the purchase of farmland owned by the estate of John Thorsen. James Thorsen was the attorney and personal representative of the John Thorsen estate.

James Thorsen informed the Vasicheks that Mrs. Cook and Mrs. Carroll desired to sell their interests in the John Thorsen farmland for $42,500.00. The Vasicheks agreed to this price and gave Thorsen, as a down payment for the property, their check for $2,000.00 made payable to Mrs. Cook and Mrs. Carroll. James Thorsen agreed to prepare the deeds and to obtain the signatures of Mrs. Cook and Mrs. Carroll thereon. He did not prepare the deeds nor mail the check to Mrs. Cook and Mrs. Carroll.

In the following months the Vasicheks asked Thorsen several times why the deeds had not been returned. In May 1972, the Vasicheks retained a lawyer to meet with Thorsen to discuss the matter. The following answers by Thorsen to questions submitted to him at trial indicate what occurred at this meeting:

"Q Now, at that time, you told Mr. and Mrs. Vasichek, did you not, that the matter was had not been concluded and you didn't have any title transferring documents at that time in your possession?

"A I would imagine that would have been what I told them, yes.

"Q You also told them at that time that the papers were out west and that's where the difficulty was?

"A Yes, I'm sure I said that, yes.

"Q And there was even some discussion at that time about the possibility of you going out west to get them to hurry them up to sign these documents so that this thing could be concluded?

"A I would imagine that was one of the possibilities, yes.

"Q Now, at that particular time you had not made out any deed yet and sent them out for their signatures, had you?

"A No, I wasn't instructed to do so."

When the deeds were finally sent to Mrs. Cook and Mrs. Carroll in July 1972, they refused to sign them. The Vasicheks then brought an action for breach of contract against Mrs. Cook, Mrs. Carroll and James Thorsen. The trial court granted summary judgment in favor of Mrs. Cook and Mrs. Carroll. The Vasicheks purchased the farmland from Mrs. Carroll and Mrs. Cook in September 1975, for the sum of $141,500.00.

In their breach of contract action against Thorsen, the Vasicheks made an amendment to their complaint to include two additional theories of liability: (1) that Thorsen breached an implied warranty of authority to sell real estate, and (2) that Thorsen was negligent because he did not send the deeds to his principals in a timely manner. Both theories of liability were submitted to the jury, which returned a general verdict in favor of the Vasicheks in the sum of $75,000.00, plus interest and costs.

Thorsen contends that there was no evidence upon which a jury could find him liable on any theory of liability. Our review of questions of fact tried to a jury is limited to determining whether there is substantial evidence to support the verdict. Falkenstein v. City of Bismarck, 268 N.W.2d 787 (N.D.1978). All evidence must be reviewed in the light most favorable to the verdict. It is only when reasonable men can reach but one conclusion upon review of the issues that the evidence becomes a question of law for the court. Buehner v. Hoeven, 228 N.W.2d 893, 904 (N.D.1975).

When the appeal is from both a judgment on a verdict and from a denial of judgment notwithstanding the verdict or new trial, our court can consider all issues which were properly preserved at trial. Davis v. Davis, 268 N.W.2d 769 (N.D.1978). We recently stated:

"The motion for judgment notwithstanding the verdict and the motion for a new trial are motions directed to the sound discretion of the trial court and will not be overturned on appeal unless it is clear that there was a manifest abuse of discretion. Rules 50 and 59, N.D.R.Civ.P.; . . ." Falkenstein v. City of Bismarck, 268 N.W.2d at 790, Supra.

We find no abuse of discretion by the trial judge. To sustain a judgment notwithstanding the verdict, the moving party must have been entitled to judgment as a matter of law. Riebe v. Riebe, 252 N.W.2d 175, 177 (N.D.1977).

I.

The jury could have concluded that Thorsen held himself out to the Vasicheks as possessing the authority to bind Mrs. Cook and Mrs. Carroll to a real estate transaction and therefore that he was the actual agent of Mrs. Cook and Mrs. Carroll. The basis of the Vasicheks' claim is found in Chapter 3-04, North Dakota Century Code. The relevant sections are as follows:

"3-04-01. Agent warrants authority. One who assumes to act as an agent thereby warrants to all who deal with him in that capacity that he has the authority which he assumes."

"3-04-02. When agent liable as principal. One who assumes to act as an agent is responsible to third persons as a principal for his acts in the course of his agency in any of the following cases, and in no others:

"1. . . .

"2. When he enters into a written contract in the name of his principal without believing, in good faith, that he has authority to do so; or

"3. When his acts are wrongful in their nature."

There is ample evidence in the record to support a jury finding that Thorsen warranted that he had the status of a real estate agent with the authority to bind his principals. Thorsen acknowledged that he was the personal representative of the John Thorsen estate. Although he never attempted to convey the property in that capacity, he did, as a matter of law, possess the power to do so. Section 30.1-18-11, NDCC. The Vasicheks had engaged in previous business transactions with Thorsen in his capacity as personal representative. Prior to negotiating for purchase of the land, the Vasicheks had farmed the property for five years pursuant to a lease with Thorsen as personal representative. It is our view that the jury could have reasonably found that the Vasicheks relied upon Thorsen's representations that he had the power to sell the farmland.

Thorsen relies upon the statute of frauds, § 9-06-04(4), NDCC, as a defense to the claim of breach of implied warranty of authority. He argues that an enforceable contract between himself and the Vasicheks is a prerequisite to liability. Our statute of frauds provides:

"9-06-04. Contracts invalid unless in writing Statute of frauds. The following contracts are invalid, unless the same or some note or memorandum thereof is In writing and subscribed by the party to be charged, or by his agent:

"4. An agreement for the leasing for a longer period than one year, or for the sale, of real property, or of an interest therein. Such agreement, if made by an agent of the party sought to be charged, is invalid unless the authority of the agent is in writing subscribed by the party sought to be charged."

(Emphasis added.)

An oral agreement, the form of which does not comply with the statute of frauds or fall within one of its exceptions, cannot be the basis of an action for damages. See Van Camp v. Van Camp, 291 Mich. 688, 289 N.W. 297, 299 (1939). In the absence of an enforceable contract, there can be no recovery of damages on the theory of implied warranty of authority. Implied warranties are intended to hold vendors to a course of fair dealing in the performance of contracts which are otherwise enforceable. See Waggoner v. Midwestern Development, Inc., 83 S.D. 57, 154 N.W.2d 803, 807 (1967).

The sufficiency of a memorandum within the statute of frauds is a question for the court to determine as a matter of law. Johnson v. Auran, 214 N.W.2d 641, 652 (N.D.1974). To constitute a sufficient memorandum, the writing must disclose the identity of the parties, the subject matter of the agreement, and the express consideration, as well as the terms and conditions upon which the contract was entered into. Rohrich v. Kaplan, 248 N.W.2d 801 (N.D.1977).

On December 15, 1971, Thorsen wrote the following in a letter to Mr. vasichek:

"This is to confirm that the heirs of the above mentioned estate have agreed to sell to you all of the farm real estate belonging to the above mentioned decedent and located north of Michigan, North Dakota. The transaction has been bound by your down payment and the necessary proceeding and documentation are presently underway and I would hope that the transaction can be completed sometime during the month of January of next year. Should you need any further evidence of your pending purchase, kindly let me know and I will be happy to furnish whatever may be necessary."

This letter sufficiently describes the land to be sold, the parties to this contract, and that the "transaction" is secured by a down payment. The terms, conditions and the completion date of the agreement are set forth. Even in an action for specific performance, the letter would comply with the statute of frauds if it recited the amount of consideration to be paid for the property. In a case involving the question whether a deed was a sufficient memorandum to satisfy the statute of frauds, we said:

"Here, all of the terms of the oral agreement are set forth in the deed except the consideration. The deed does express a consideration,...