Zuhak v. Rose

• Decision Date: 02 June 1953
• Citation: 264 Wis. 286,58 N.W.2d 693
• Parties: , 37 A.L.R.2d 1041 ZUHAK, v. ROSE.
• Court: Wisconsin Supreme Court

Page 693

58 N.W.2d 693

264 Wis. 286, 37 A.L.R.2d 1041

ZUHAK, v. ROSE.

Supreme Court of Wisconsin.

June 2, 1953.

Action for specific performance of an alleged contract for the sale of real estate. In the alternative, a second cause of action demands damages. The court found that there was such a contract and by its judgment ordered defendant to convey, meanwhile retaining jurisdiction to grant other relief if defendant is unable to perform. Defendant has appealed.

Defendant, part owner of a large estate, determined to sell it and employed an auctioneer, Bohr, to conduct a sale. Their contract was in the form of a letter by Bohr to Mr. and Mrs. Rose. It did not mention an auction but provided that in order to get a ten per cent commission Bohr must find a bidder who would sign a contract to purchase at a price satisfactory to defendant.

Simultaneously with the letter, Bohr and defendant prepared an advertisement for an auction to be held on the farm July 8th. The advertisement stated that the personal and real property was to be sold 'without reserve'; that the present owner is Edward Rose (the defendant); that the order of sale would be:

11 A.M. CST--All small tools on farm and estate

12 A.M. to 12:30 CST--Lunch time

12:30 A.M. (sic) to 1:30 CST--Farm machinery

1:30 P.M. to 2:30 CST--Selling of all real estate as listed

2:30 CST until finished--All of furniture

The real estate was listed as follows:

'320 Acre Estate to be sold in following parcels or combination or altogether--whichever way brings the most money--as follows:

'Parcel #1-17 Acres which includes 8 Buildings such as Large 14 Room Home, All Modern--7 Room Home, All Modern--Basement Barn, All Complete, 125X40' Baloon Type--2 Silos, Concrete, 16X50'--Milk House for Grade A Milk--Chicken House--Machine Shed--All Buildings Have Excellent Roofs--Entire Property Beautifully Landscaped--All Enclosed in Beautiful Sturdy White Fence.

* * *

* * *

'Parcel #2-8 Acres of Heavily Wooded Area--Excellent Building Location--75' above Lake Level--Wonderful View.

'Parcel #3-72 Acres of Very Fertile Land with Large Machine Shed--Road on 2 sides--Cropped now with Soy Beans and Corn.

'Parcel #4-2 1/2 Acres of Land with 3 Room House--Has its own water system.--All Complete.

'Parcel #5-25 Acres of Level Land with Gravel Pit. All parcels suitable for Subdivision. All frontage on Highway.

'Parcel #6-93 Acres of Level Fertile Land--Joins Parcel #5--Also next to Golf Course.

* * *

* * *

'Parcel #7-25 Acres of Low Land--Suitable for Vegetable Farming--Some of it is tiled--Channel of Water Included.

'Parcel #8-28 Acres of High Land--Joins Parcel #7--Potential Subdivision Property--Very Fertile Land--Channel of water included.

'Parcel #9--Subdivision--Known as Nippersink Shore Manor--65 Beautiful Lots--All Recorded Plot with Roads all in--Electricity and Gas all completed and in. Lake rights for each lot with lovely beach.'

Maps on hand at the auction showed the location of such parcels.

Part of such real estate was owned by a corporation which defendant controlled. The rest was owned by defendant and his wife as joint tenants. The advertisement was published in the Chicago Tribune and at the sale Mrs. Rose passed out brochures to prospective purchasers which repeated the information.

At the start of the auction Bohr made an announcement repeating the terms of the advertisement, particularly that the sale was without reserve, but modifying the required down payment by reducing it from twenty-five per cent to ten per cent. Mr. Rose and his Illinois attorney, Mr. Kelner, were present and made no public correction or objection. Mr. Rose informed the crowd that the land was farmed on shares and Rose's one-half of the crops, worth $6,000, went with the land.

Sale of property was held in the advertised order. About 2:00 or 2:30 P.M. the auction of the real estate commenced. Parcel 1 was offered first. One bid was made and refused by the auctioneer. No other bids were made on it. Plaintiff then asked Bohr to offer Parcels 1, 2, 3, 5 and 6. Bohr made a memorandum of the request, announced that the parcels included 215 acres, and called for bids. Plaintiff bid $20,000. Bohr said he would not start that low. Plaintiff bid $25,000 which Bohr accepted and other bidding followed in raises of $1,000. At 3:30 or 4:00 P.M. plaintiff bid $41,000. Before another bid was made defendant and his attorney ordered the auction stopped. Mr. Kelner announced that the property would not be sold for sums like the ones bid nor would it be sold for less than $100,000. There were loud objections and much turmoil and Kelner discharged Bohr. Those attending the sale protested but there was no further effort to continue the action. Mr. Rose and Mr. Kelner drove away. Bohr made out a memorandum of the sale which he did not deliver to plaintiff but gave to plaintiff's attorney, later. Plaintiff made no tender of a down payment at the scene of the auction or later.

Plaintiff's complaint demands specific performance by conveyance to him of the parcels identified as Parcels 1, 2, 3, 5 and 6 and, in the alternative, damages in the sum of $40,000. Defendant's answer was a general denial. Trial was to the court which made findings of fact and conclusions of law in plaintiff's favor. Various deeds were in evidence which the court used to identify the parcels and to give them their legal descriptions. The court gave an interlocutory judgment ordering defendant to tender to plaintiff a warranty deed of the lands in question in consideration of the payment into court by plaintiff of $41,000. In default of such tender by defendant the judgment permits plaintiff to apply for a judicial conveyance and the court retained jurisdiction so that if good title cannot be conveyed the court may determine whether an abatement of the purchase price, commensurate with the defects in title, or an award of damages to plaintiff shall be adjudged.

Lawrence Ruetz, Kenosha, Godfrey & Godfrey, Elkhorn, Thomas, Orr, Isaksen & Werner, Madison, for appellant.

Morrissy, Morrissy & Zastrow, Elkhorn, for respondent.

BROWN, Justice.

Defendant's appeal rests principally on his contention that there is no contract between plaintiff and defendant; hence specific performance of one may not be ordered.

We consider that a contract did arise out of the facts and circumstances of this auction whereby defendant's offer to sell to the highest bidder without reserve was accepted by plaintiff with his bid of $41,000. The letter by Bohr to Mr. and Mrs. Rose whereby he engaged to find a purchaser at a price satisfactory to the Roses in order to be entitled to a commission is immaterial here, however relevant it might be in an action by Bohr for compensation. Defendant's liability rests on what he held out to the plaintiff not on his arrangements with his auctioneer. Defendant was responsible for informing plaintiff by the Tribune advertisement, by circulars distributed at the auction and by the auctioneer's oral announcement, that there was to be a complete liquidation of all the advertised property without reserve, and that the realty would be sold as a whole or piecemeal, whichever brought the most money. Defendant made no correction. He supplemented Bohr's announcement by declaring that his half of the standing crops went with the land. He is bound by the terms so stated.

The words 'without reserve' as used in auctions are words of art, assuring prospective bidders that the property will actually go to the bidder offering the highest price. The seller may not nullify this purpose by bidding himself or through an agent, nor by withdrawing the property from sale if he is not pleased with the bids. Thus, the seller may not refuse to accept a bid where the auction is without reserve; the bid itself establishes a...