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Spiller v. MackerethSupreme Court of Alabama, 1976

© Morrison’s auto-rite

The Auto-Rite lessee who vacated the premises

Facts: Spiller and Mackereth leased their building to Auto-Rite. Auto-Rite moved out and Spiller moved in. Mackereth wrote a letter demanding that Spiller vacate half of the building or pay half the rental value. Spiller did neither. Mackereth sued and won $2100 in rent at trial. Spiller appealed.

Issue: Did Spiller oust Mackereth so as to entitle Mackereth to half the fair rental value?

Swartzbaugh v. Sampson

Calif. Ct. of Appeals (1936)

The boxing pavilion in 1936

Edison Field, home of the Anaheim Angels, sits on

the old Swartzbaugh property.

© www.photofile.com

Facts: Mr. and Mrs. Swartszbaugh owned property as JTs. Mr. Swartzbaugh unilaterally leased part of the property to Sampson for use as a boxing pavilion. Mrs. Swartzbaugh sued Sampson to cancel the lease.

Issue: Can Mrs. Swartzbaugh cancel the lease to Sampson? What are her remedies?

Remedies Issues

Partition- How would the court divide these property rights?

Ouster- If Sampson ousted Mrs. Swartzbaugh he would owe her one half of the market rent for the property, but the court probably would have to account for the value his improvements added to the property. Sampson would still have to pay Mr. S something, but what? Depends on parties’ agreement about what Sampson was leasing (which JT’s rights) and on unjust enrichment arguments.

Accounting- Mrs. Swartzbaugh can sue Mr. Swartzbaugh for ½ the actual rent he is receiving from Sampson. Can she sue for accounting and for ouster? If she has to choose one or the other, which is preferable?

Sawada v. EndoSupreme Court of Hawaii, 1977

>

Hawaii

Lansing, Michigan

Sawada v. EndoFacts: Mr. Endo hit the Sawada’s with his car. The Sawadas sued Mr. Endo.Mr. and Mrs. Endo then gave their home, which

they owned as TBEs.

Issue:Was this a fraudulent conveyance?Is one spouse’s interest in TBE property subject to

the rights of the other spouse’s creditors?

Summary of TBE-MWPA Issues:

Majority Rule: H & W have equal rights to possession during marriage, and neither can convey her or his interest. Therefore, creditors cannot reach individual interests.

Primary Minority Rule: W now has same rts H had at CL. Therefore, either can convey their present possessory rights and their own ROS, but neither can affect the other’s ROS.

Concurrent Estates Quiz

1. O --> A& B as JTsA mtgs her interest.

What is the state of title?

2. A dies.What is the state of title?

3. O --> A& B as JTs

A leases her interest to C.


4. A dies.


5. If O conveys to A and B as TBEs, but A and B aren’t married, what is the state of title?

6. If H & W hold as JTs and they divorce, what is the state of title?

7. What if one JT files an action for partition, what is state of title?

The Land Sale ContractThe Land Sale Contract Identify the partiesIdentify the parties Identify the propertyIdentify the property State the price/depositState the price/deposit Address contingencies/conditionsAddress contingencies/conditions Set dates: inspection, financing, closing, Set dates: inspection, financing, closing,

possessionpossession Attorney reviewAttorney review SurveySurvey Title Title Risk of lossRisk of loss Time is of the essence clauseTime is of the essence clause ProrationsProrations

The Executory PeriodThe Executory Period

Land saleagreement executed

Inspection

Financing

Survey

Etc.Closing

The Broker’s RoleThe Broker’s RoleTypically, the Broker works for the Seller.Typically, the Broker works for the Seller.Broker’s duties Broker’s duties to the Sellerto the Seller include: include: Good faith & fair dealing Good faith & fair dealing Listing—MLSListing—MLS ShowingShowing Administrative assistanceAdministrative assistance Helping negotiate/maximize priceHelping negotiate/maximize price Communicating helpful informationCommunicating helpful information Limited/unlimited closing duties Limited/unlimited closing duties Disclose defects to Buyers in some statesDisclose defects to Buyers in some states

ListingsListings

OpenOpen – Anyone can sell, and only the – Anyone can sell, and only the actual seller has a shot at the commission.actual seller has a shot at the commission.

Exclusive agencyExclusive agency – Listing Broker is – Listing Broker is exclusive agent. If another agent sells, he exclusive agent. If another agent sells, he has to share commission with Listing has to share commission with Listing Broker. Broker. ButBut, owner can sell and not pay., owner can sell and not pay.

Exclusive Right to Sell – (most common by far) If anyone buys within the specified timeframe, the Listing Agent gets paid.

The Two Broker DilemmaThe Two Broker DilemmaListing Broker

Selling Broker

Lists and shows the property for the Seller.

Works with the buyer, but is the Seller’s agent.

Buyers’ BrokersBuyers’ Brokers

Buyers’ Brokers duties include:Buyers’ Brokers duties include: Good faith and fair dealingGood faith and fair dealing Helping negotiate/minimize priceHelping negotiate/minimize price Administrative--help with Administrative--help with

inspection/surveyinspection/survey Administrative--Closing?Administrative--Closing? CommunicationCommunication Disclose material defects?Disclose material defects?

The Two-Principal DilemmaThe Two-Principal Dilemma

Dual Agents:Dual Agents:One agent may work for both Buyer and One agent may work for both Buyer and

Seller.Seller.

That agent owes the Buyer and Seller the That agent owes the Buyer and Seller the same duties of good faith, loyalty, etc.same duties of good faith, loyalty, etc.

This presents an obvious conflict of This presents an obvious conflict of interest.interest.

Many states permit this on the condition Many states permit this on the condition that there is full disclosure up front to that there is full disclosure up front to both parties.both parties.

Commission IssuesCommission IssuesThe traditional ruleThe traditional rule::Brokers earn commission by producing “ready,

willing, and able” buyer.Didn’t matter whether seller or buyer backed out of

the deal. Minority rule: No commission if buyer backs out, but

commission generally ok if seller improperly backs out.

Listing Agreement can, and generally does, change the majority rule.

Nowadays, by custom (and by law in some jurisdictions) :

The Broker’s commission typically is payable only at closing.

Licari v. BlackwelderLicari v. Blackwelder

Appellate Ct. of Conn, 539 A2d 609

(1988)

(c) 2005 Zero One Entertainment Inc.

Working with real estate brokers started out like this…

®

And ended up like this.


Facts: First broker got 24-hr exclusive r-t-s listing at $125K.

Second broker (subagent) offered $115K, which Plaintiffs accepted.

Six days later, buying brokers flipped to previously identified buyer for $160K.


Issue: Did the Defendants owe Plaintiffs a duty to disclose the existence of the other buyer and their intent to flip the property?

The Statute of FraudsThe Statute of Frauds

To enforce the conveyance of an To enforce the conveyance of an interest in land, you generally need a interest in land, you generally need a writing signed by the adverse party writing signed by the adverse party that indicates an intent to convey that indicates an intent to convey and adequately describes the and adequately describes the property and the price.property and the price.

Some states require all material terms Some states require all material terms to be in writing.to be in writing.

Breaking Down the SoFBreaking Down the SoF

““To enforce the conveyance of an To enforce the conveyance of an interest in land”interest in land”

For now, we are focusing on land sale For now, we are focusing on land sale contracts, although the SoF applies more contracts, although the SoF applies more broadly.broadly.

Without a writing, such contracts aren’t enforceable, except for leases of less than one or three years, depending on the jurisdiction. These can be verbal.


““You need a writing”You need a writing”A proper contract or deed will A proper contract or deed will

obviously do.obviously do.So will a less formal document if it So will a less formal document if it

meets all the requirements.meets all the requirements.Even Even separateseparate documents that documents that

collectivelycollectively meet the requirements will meet the requirements will do if the court believes they should be do if the court believes they should be read together.read together.

Emails are iffy.Emails are iffy.

Breaking Down the SoFBreaking Down the SoF““Signed by the adverse party”Signed by the adverse party”

If the owner of the interest hasn’t signed a writing, the buyer is out of luck. The courts usually won’t enforce the alleged transaction.

Generally, any sign or symbol adequately identifying the owner or signifying her assent is sufficient.

Some states allow electronic “signatures”, others don’t.

A land sale contract can only be enforced against one who has signed it.

Breaking Down the SoFBreaking Down the SoF““Adequately describes the property”Adequately describes the property”

A “legal description” is preferred. This means a “metes and bounds” or plat reference or survey description.

A street address may or may not suffice.

Some more generic descriptions (eg, my property in Cook County) may also work, but don’t count on it.


““Adequately describes the price”Adequately describes the price”

If a price was agreed to, it must be included.

If no price was agreed to, some courts may infer a reasonable price.

If the Seller is financing the sale, those terms generally must be spelled out in detail.

Exceptions to the SoFExceptions to the SoFThe Part Performance DoctrineThe Part Performance DoctrineThis is one This is one substitutesubstitute for the “writing” requirement for the “writing” requirement

of the SoF.of the SoF.If: 1) the buyer has paid some or all of the price, If: 1) the buyer has paid some or all of the price, 2) the buyer has taken possession, and 3) the 2) the buyer has taken possession, and 3) the buyer has made improvements, most buyer has made improvements, most jurisdictions will enforce a contract proven by jurisdictions will enforce a contract proven by “clear and convincing evidence” even if it is not “clear and convincing evidence” even if it is not in writing.in writing.

Some jurisdictions may accept only two, or even Some jurisdictions may accept only two, or even one, of these acts as sufficient evidence that a one, of these acts as sufficient evidence that a contract was made.contract was made.

Exceptions to the SoFExceptions to the SoF

Part Performance (continued)Part Performance (continued)Courts commonly require that the acts listed above Courts commonly require that the acts listed above

be performed “in reference to the alleged be performed “in reference to the alleged contract,” but this requirement is waived when the contract,” but this requirement is waived when the adverse party admits the existence of the contract.adverse party admits the existence of the contract.

Some courts will only apply the doctrine if necessary Some courts will only apply the doctrine if necessary to prevent injustice to the plaintiff. to prevent injustice to the plaintiff.

Generally, the exception applies only in equity– Generally, the exception applies only in equity– ieie, , the court will award specific performance but not the court will award specific performance but not damages.damages.


EstoppelEstoppel

If a plaintiff takes any material, detrimental If a plaintiff takes any material, detrimental action in reasonable reliance on the action in reasonable reliance on the defendant’s oral promise to sell, and it defendant’s oral promise to sell, and it would be inequitable not to enforce the would be inequitable not to enforce the sale, a court will enforce it even absent a sale, a court will enforce it even absent a writing.writing.


Note that as to both exceptions, courts Note that as to both exceptions, courts tend to be very imprecise in tend to be very imprecise in delineating the exception they are delineating the exception they are employing. They often mix and employing. They often mix and match the terms and the elements.match the terms and the elements.

Hickey v. GreenHickey v. GreenAppeals Court of Massachusetts, 1982Appeals Court of Massachusetts, 1982

Hickey v. GreenHickey v. Green

FactsFacts: Mrs. Green orally agreed to sell her lot : Mrs. Green orally agreed to sell her lot to the Hickeys. She accepted but didn’t to the Hickeys. She accepted but didn’t endorse a deposit check. The Hickeys then endorse a deposit check. The Hickeys then sold their home, intending to build on the sold their home, intending to build on the Green lot. Despite knowing this, Mrs. Green Green lot. Despite knowing this, Mrs. Green backed out of the deal. The Hickeys seek backed out of the deal. The Hickeys seek specific performance.specific performance.

Issue: Can the Hickeys enforce an oral agreement to convey the Green lot?

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