Botticello v Stefanovicz PDF

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Botticello v Stefanovicz Case Brief and Notes for Business Organizations I...

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Botticello v. Stefanovicz Purchaser of property (P) v. Sellers of property (D) Conn. Sup. Ct., 177 Conn. 22, 411 A.2d 16 (1979).

NATURE OF CASE:

Appeal by property sellers from an order for specific performance in favor of the property purchaser.

FACT SUMMARY:

Mary and Walter Stefanovicz (D) were tenants in common of a farm. Botticello (P) wanted to purchase the farm. Botticello (P) and Walter (D) agreed upon a price of $85,000 for a lease with an option to purchase and signed papers to that effect, but Botticello (P) did not know at the time that Walter (D) did not own the property outright. When Mary (D) and Walter (D) subsequently refused to honor the option agreement, Botticello (P sued them for specific performance. Mary (D) and Walter (D) contended tha Walter (D) was not Mary's (D) agent, so that the agreement was not binding upon her.

RULE OF LAW (1) An agency relationship cannot be established where the fair preponderance of the evidence does not indicate that the purported principal has authorized or agreed to the purported agent acting on her behalf. (2) A person cannot ratify a prior act where the person neither intends to do so nor has full knowledge of all the material circumstances.

FACTS:

Mary and Walter Stefanovicz (D) were tenants in common of a farm. Botticello (P) visited the farm and offered $75,000 to purchase it. At tha time, Mary (D) stated that there was “no way” she could sell it for that amount Ultimately, Botticello (P) and Walter (D) agreed upon a price of $85,000 for a lease with an option to purchase. The informal agreement was finalized with the assistance of counsel for both Walter (D) and Botticello (P). Neither Botticello (P) nor his attorney, nor Walter's (D) attorney, was then aware of the fact tha Walter (D) did not own the property outright. After execution of the lease and option-to-purchase agreement, Botticello (P) took possession of the property and made substantial improvements on it. When Mary and Walter Stefanovicz (D "****** DEMO - www.ebook-converter.com*******"

refused to honor the option agreement, Botticello (P) sued them for specific performance. The trial court ordered specific performance, holding that although Mary (D) was not party to the lease and option-to-purchase agreement, its terms were nonetheless binding on her because Walter (D) had acted as her authorized agent in the negotiations, discussions, and execution of the written agreement The court also held that even if Walter (D) had not acted as Mary's (D) agent Mary (D), through her subsequent conduct, ratified the agreement. The state's highest court granted review.

ISSUE: (1) Can an agency relationship be established where the fair preponderance o the evidence does not indicate that the purported principal has authorized o agreed to the purported agent acting on her behalf? (2) Can a person ratify a prior act where the person neither intends to do so no has full knowledge of all the material circumstances?

HOLDING AND DECISION:

[Judge not stated in casebook

excerpt.] (1) No. An agency relationship cannot be established where the fair preponderance of the evidence does not indicate that the purported principa has authorized or agreed to the purported agent acting on her behalf. The existence of an agency relationship is a question of fact. The burden o proving agency is on the plaintiff, and it must be proven by a fai preponderance of the evidence. Marital status cannot in and of itself prove an agency relationship, so here, the mere fact that Mary (D) and Walter (D were married does not prove such a relationship. The fact that one person owns property with another by itself also does not establish agency, so tha Mary and Walter's (D) common ownership of the land does not make one the agent for the other. Although Mary (D) remarked that she would not sell the farm for less than $85,000, a statement that one will not sell for less than a certain amount is by no means the equivalent of an agreement to sell for tha amount. Moreover, the fact that one spouse tends more to business matter than the other does not, absent other evidence of agreement or authorization constitute the delegation of power as to an agent. Furthermore, although Mary (D) may have acquiesced in Walter's (D) handling of many busines matters, Walter (D) never signed any documents as agent for Mary (D) prio to the time of the alleged farm sale. Mary (D) had consistently signed any deed, mortgage, or mortgage note in connection with their jointly held property. All these facts, taken together, demonstrate the absence of an "****** DEMO - www.ebook-converter.com*******"

agency relationship between Walter (D) and Mary (D). Specific performance against Mary (D) is precluded. Reversed as to this issue. (2) No. A person cannot ratify a prior act where the person neither intends to do so nor has full knowledge of all the material circumstances. Ratification i defined as “the affirmance by a person of a prior act which did not bind him but which was done or professedly done on his account” and it require acceptance of the results of the act with an intent to ratify, and with ful knowledge of all the material circumstances. The facts here do not indicate that Mary (D) intended to ratify the agreement, nor do they establish he knowledge of all the material circumstances surrounding the deal. At most Mary (D) observed Botticello (P) occupying and improving the land received rental payments from him from time to time, knew that she had an interest in the property, and knew that the use, occupancy, and rentals were pursuant to a written agreement she had not signed. None of these facts i sufficient to support the conclusion that Mary (D) ratified the agreement and thus bound herself to its terms—especially since Walter (D) had the right to lease his undivided one-half interest in the property. Moreover, since Walte (D) never purported to be acting on Mary's (D) behalf, she cannot be deemed to have ratified the agreement by merely accepting its benefits and by failing to repudiate it. That is because if the original transaction was not purported to have been done on account of the principal, the fact that the principa receives its proceeds does not make him a party to it. Specific performance reversed as to Mary (D). Reversed and remanded for a new trial.

ANALYSIS Agency may be either actual or apparent. Apparent authority is that semblance of authority that a principal, through his own acts or inadvertences, causes o allows third persons to believe his agent possesses. Apparent authority thus mus be determined by the acts of the principal rather than by the acts of the agent Since in this case Botticello (P) admitted that he did not know of Mary's (D interest in the land at the time the agreement was signed, her actions could no form the basis for a finding of apparent authority, which is likely why Botticello (P) did not pursue that theory of agency.

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Quicknotes An equitable remedy whereby the court requires the parties to perform their obligations pursuant to a contract.

SPECIFIC PERFORMANCE

An interest in property held by two or more people, each with equal right to its use and possession; interests may be partitioned, sold conveyed, or devised.

TENANCY IN COMMON

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