Hale v. Kreisel , 194 Wis. 271 ( 1927 )

The following opinion was filed .September 13, 1927:

Stevens, J.

Sec. 240.10 of the Statutes provides:

“Every contract to "pay a commission to a real-estate agent or broker or to any other person for selling or buying real estate or negotiating lease therefor for a term or terms exceeding a period of three years shall be void unless such contract or some note or' memorandum thereof describing such real estate, expressing the price for which the same may be sold or purchased, or terms of rental, the commission- to be paid find the period during which the agent or broker shall procure a buyer or seller or tenant, be in writing and be subscribed by the person agreeing to pay such commission.”

The fundamental question presented by this appeal is whether the. legislature by the passage of. this act has prevented recovery upon quantum meruit for services performed in buying or selling real estate when no contract in writing has been made as required by this section.

This statute clearly expresses the legislative intent that there shall be no recovery for such services in the absence of such a written contract. This statute is an extension or enlargement of the-statute of frauds. It is as valid an exercise of the police power as are any of the other provisions of the statute of frauds which require certain contracts to be in writing. Selvage v. Talbott, 175 Ind.. 648, 95 N. E. 114, 33 L. R. A. n. s., 973, 974, 975.

“The statute was doubtless enacted for reasons similar to those which led to the enactment of the statute of frauds. It was to. prevent frauds and perjuries. Its enforcement will sometimes protect brokers who have rendered valuable services too little appreciated. More often it will protect owners from unfounded claims. It will tend to prevent the flood of litigation arising out of misunderstandings between well-meaning persons. We believe that in order to carry out the legislative intent we should hold contracts void which do not substantially comply with the statute. In other words, that the statute means what it says.” Gifford v. Straub, 172 Wis. 396, 399, 400, 179 N. W. 600. See, also, Danielson v. Goebel, 71 Neb. 300, 302, 98 N. W. 819, 820; Selvage v. Talbott, 175 Ind. 648, 95 N. E. 114, 33 L. R. A. n. s. 973, 975.

To hold that there can be recovery upon quantum meruit is “to open the door to the very abuses the statute was enacted to prevent, and defeat its manifest purpose.” Barney v. Lasbury, 76 Neb. 701, 705, 107 N. W. 989, 991.

When this question was presented in Seifert v. Dirk, 175 Wis. 220, 184 N. W. 698, this court held that there could be a recovery on quantum meruit, basing its decision upon the rule that had been applied in cases arising under other provisions of the statute of frauds where recovery was had for services rendered under contracts which were void under the statute of frauds. The fact that practically every court that has considered this question under legislative enactments similar to sec. 240.10 of the Statutes has held that there can be no recovery upon quantum meruit has led this court to'carefully reconsider the question. That consideration has led to the conclusion -that the rule in Wisconsin must be brought into harmony with the clear intent of the legislature and also into harmony with the adjudicated cases by holding that there can’be no recovery in the nature of commissions by real-estate brokers- or others -upon quantum meruit for services rendered in buying or selling real estate.

Every other adjudicated case that the court has found that has passed upon the question has held that the rule permitting recovery on quantum meruit for services rendered under -contracts void under the statute of frauds does not warrant a recovery upon 'quantum meruit for commissions which measure-the reasonable value of the services performed in buying and-’ selling real estate. The obvious reasons for these decisions is that the application of the rule which permits recovery upon quantum meruit to the case of real-estate brokers absolutely nullifies these statutes which declare every such contract to be void if not in writing. These statutes leave no opportunity for the law to imply a contract. They apply to implied agreements as well as to those that are express.

“To hold that performance takes a claim of this character out of the operation of the statute would, in our opinion, leave nothing for the statute to operate on. Such construction would render the statute useless and meaningless and would be tantamount to saying that any contract lor a commission or reward for the finding or procuring of a purchaser of the real estate of another is valid, though not in writing and not signed by the owner of such real estate, which is directly opposite to the expressed will of the legislature.” Weatherhead v. Cooney, 32 Idaho, 127, 131, 180 Pac. 760, 761. See, also, Paul v. Graham, 193 Mich. 447, 451, 160 N. W. 616, 617; Blair v. Austin, 71 Neb. 401, 406, 98 N. W. 1040, 1042.

It is the duty of the court to give effect to the legislative intent as expressed in the statute. That intent is so clearly expressed that no rule of construction and' no precedent or prior judicial decision should be held sufficiently potent to lead to a construction of this statute which does not give effect to the plain legislative intent.

This case well illustrates the injustice that may result if recovery upon quantum meruit is permitted in spite of the statute. The trial court made no finding as'to the oral contract entered into by the parties to this action, but the greater weight of the evidence establishes- the fact that the oral contract between the parties provided that.no commission should be due or paid to the plaintiffs untilat' least $5,000 had been paid upon the purchase price. The purchaser never paid that amount and has refused to take the land-or to make further payments. The judgment appealed from therefore runs counter to the express provisions of sec. 240.10 of the Statutes and to the express terms of the oral agreement under which the plaintiffs performed services.

Seifert v. Dirk, 175 Wis. 220, 184 N. W. 698, is overruled so far as it holds that one rendering services in the buying or selling of real estate may recover compensation in the nature of commissions which measure the reasonable value of such services when there is no written contract which meets the requirements of sec. 240.10 of the Statutes.

By the Court. — Judgment reversed, and cause remanded with directions to dismiss the complaint.

A motion for a rehearing was denied, with $25 costs, on December 6, 1927.