Case Title: Rauh v. Kornkven

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1993-05-19T00:00:00Z

Document:
Rauh v. Kornkven1993 WY 73852 P.2d 328Case Number: 92-278Decided: 05/19/1993Supreme Court of Wyoming
Thomas J. 
RAUH,

 Appellant 
(Plaintiff),

v.

E.W. 
KORNKVEN,

 Appellee 
(Defendant).

Appeal from District 
Court, Natrona County, Dan Spangler, J.

James R. 
McCarty, Casper, for appellant.

Keith P. Tyler, 
Casper, for appellee.

Before MACY, 
C.J., and THOMAS, CARDINE, GOLDEN and TAYLOR, JJ.

CARDINE, 
Justice.

[¶1]      Appellant Thomas 
Rauh (Rauh) brought suit against real estate salesperson, E.W. Kornkven 
(Kornkven), alleging fraud and negligent misrepresentation in the purchase of a 
small ranch near Lovell, Wyoming. After a bench trial, judgment was entered in 
favor of Kornkven on all counts. Rauh appeals from that 
judgment.

[¶2]      We 
affirm.

[¶3]      Rauh raises two 
issues:

1. Whether the court 
erred in making the factual finding that the plaintiff failed to prove that the 
statement of Kornkven that there was a 160 acre BLM lease included in the Jacobs 
Ranch was false.

2. Whether the court 
erred in refusing to grant relief to the appellant on his theory of 
negligence.

[¶4]      During June 1990, 
Kornkven and his real estate office listed the ranch of owners Mr. and Mrs. 
Jacobs for sale. Sometime before September 17, 1990, Rauh inquired of Kornkven 
concerning this ranch. The listing described the ranch as "300 + or - Acres, 
with 160 BLM acres included as part of this unit."

[¶5]      From the 
testimony at trial, it appears that, after the initial contact about the ranch, 
Rauh, Kornkven, and Rauh's cousin, Bruce Morris (Morris), discussed, visited and 
investigated this ranch property on several occasions. The testimony concerning 
these discussions is in dispute. Rauh maintains that Kornkven represented, at 
all times, that the ranch consisted of 320 deeded acres. Both Kornkven and 
Rauh's cousin Morris claim that they all knew the ranch included only 136 acres 
of fee land.

[¶6]      Kornkven also 
testified that at one of these meetings he provided Rauh with documents 
containing assessor's information which included a tax roll showing the total 
acreage to be 136. Rauh maintains that Kornkven never gave him these written 
documents.

[¶7]      On September 17, 
1990, Rauh offered to purchase the ranch for a total of $50,000.00: $15,000.00 
down at closing and $35,000.00 over ten years on a contract for deed with 10 
percent interest. Rauh expected to receive monies from a separate business deal 
and use those funds for his down payment. The business deal, however, was not 
completed, and Rauh borrowed the down payment from a friend, James Laird 
(Laird). With the borrowed down payment, Rauh closed on the ranch on October 22, 
1990. Kornkven did not attend the closing.

[¶8]      One year after 
purchasing the ranch, Rauh failed to make the initial payment on the contract 
for deed, and the Jacobs terminated the contract. Around that same period, Rauh 
filed this action against Kornkven seeking damages for fraud and 
negligence.

DISCUSSION

[¶9]      In his complaint, 
Rauh raises two claims: the first is based upon fraud, and the second is based 
upon negligence. The complaint alleged that Kornkven misrepresented the deeded 
acreage of the ranch. In his action for fraud, Rauh claims that he relied on 
Kornkven's misrepresentation, which Kornkven knew or should have known was 
false, to his detriment. In his claim for negligence, Rauh asserts that Kornkven 
breached his duty as a real estate salesperson by misrepresenting the deeded 
acreage or by failing to discover the true acreage.

[¶10]   Rauh's first argument is that the 
district court erred in finding that he failed to prove any misrepresentation. 
In essence, Rauh's argument is one challenging the sufficiency of the evidence. 
Our standard when reviewing the sufficiency of the evidence requires us to 
accept all the successful party's evidence as true and give that evidence all 
reasonable and favorable inferences. Ellison v. Walter ex rel. Walter, 834 P.2d 680, 682 (Wyo. 1992).

[¶11]   Upon careful review of the trial 
transcript, we find that there existed sufficient evidence to support the 
district court's finding that Kornkven did not misrepresent the deeded acreage. 
Both Kornkven and Rauh's cousin, Morris, testified that they and Rauh 
understood, before Rauh agreed to purchase, that the ranch did not contain 320 
acres of deeded land. In addition, Kornkven testified that he provided Rauh with 
documents which explained the accurate deeded acreage, and Kornkven presented 
those documents as an exhibit at trial.

[¶12]   Rauh's second argument claims that 
the district court erred in denying him relief on his claim of negligence. Again 
this is a sufficiency of the evidence challenge.

[¶13]   The duty of care owed by real 
estate brokers and salespersons to a nonclient buyer is: (1) to not perpetuate a 
material representation of the seller which the broker/salesperson knows or 
should know is false, and (2) to take reasonable steps to avoid giving the buyer 
false information. Hagar v. Mobley, 638 P.2d 127, 137-38 (Wyo. 
1981).

[¶14]   The trial evidence and testimony 
presented provides ample support for the trial court's denial of Rauh's 
negligence claim. Having found that Kornkven made no misrepresentations to Rauh, 
and Kornkven having testified that he gave Rauh documents explaining the actual 
fee acreage being purchased, it was reasonable for the district court to 
conclude that no duty was breached and no action in negligence 
existed.

[¶15]   Affirmed.