Title: MacDonald v. Roderick

State: vermont

Issuer: Vermont Supreme Court

Document:

NOTICE:  This opinion is subject to motions for reargument under V.R.A.P. 40
 as well as formal revision before publication in the Vermont Reports.
 Readers are requested to notify the Reporter of Decisions, Vermont Supreme
 Court, 111 State Street, Montpelier, Vermont 05602 of any errors in order
 that corrections may be made before this opinion goes to press.


                                 No. 90-115


 Susan MacDonald, et al.                      Supreme Court

                                              On Appeal from
      v.                                      Caledonia Superior Court

 Charles Roderick, et al.                     October Term, 1991


 Alan W. Cheever, J.

 Joseph C. Benning and Jenifer Jill Mathers, Law Clerk (On the Brief),
   Lyndonville, for plaintiffs-appellees

 Deborah T. Bucknam, St. Johnsbury, for defendants-appellants


 PRESENT:  Allen, C.J., Gibson, Dooley, Morse and Johnson, JJ.


      DOOLEY, J.   Charles and Nancy Roderick, defendants, appeal from a
 superior court judgment awarding plaintiffs, Susan McDonald and Thomas
 Smith, a real estate sales commission.  Defendants allege that plaintiffs
 fraudulently induced them to enter into a listing agreement with them.
 They further claim that because the listing agreement violated certain rules
 of the Vermont Real Estate Commission, it cannot be used to require them to
 pay a commission.  We affirm.
      Plaintiffs are real estate brokers who do business through a partner-
 ship called Century 21 Select Realty.  In 1988, they employed Michael
 Griffin as a sales associate.  In September 1988, defendant Charles
 Roderick asked Mr. Griffin to come to defendants' home in St. Johnsbury to
 discuss the sale of the home and surrounding land.  After an initial meeting
 with defendants, Mr. Griffin prepared an exclusive sales listing and pre-
 sented it to defendants for signature.
      Defendants were interested in selling their home because they needed
 money to meet another financial obligation.   Nancy Roderick was very
 reluctant to sell their home and left the room crying when the details of
 the listing agreement were being discussed.  Both defendants asked Mr.
 Griffin whether they would have the right to cancel the agreement.  At one
 point, Mr. Griffin directed Mr. Roderick's attention to a section of the
 preprinted agreement, which provided:
         This contract is not cancellable prior to its express
         termination date, unless by mutual consent of the
         parties hereto; as long as affirmative selling efforts
         are made by Broker on Owner's behalf.

 At another, he stated that defendants could cancel by giving written notice.
 He answered "yes" to an inquiry whether defendants could cancel at any time.
 The court found, however, that under a reasonable view of the
 circumstances at the time the promise was made, defendants' right to cancel
 expired when plaintiffs procured a qualified purchaser.
      Both defendants signed the listing agreement, giving plaintiffs the
 exclusive right to sell the home and surrounding property for $225,000.
 The agreement provided that if the property were sold, plaintiffs would
 receive a commission of 10% of the sales price.  Although the agreement
 stated that it would be effective for one year, the parties agreed that it
 should be effective for only thirty days because of defendants' urgent need
 for money.  Mr. Griffin agreed to make that change in the agreement but did
 not do so.
      Plaintiffs immediately showed the property and, on September 17, 1988,
 obtained a buyer at the terms specified by defendants.  When the purchase
 and sale contract was presented to defendants, however, they stated that
 they no longer wanted to sell.  Mrs. Roderick then wrote a letter to that
 effect and presented it to Mr. Griffin.
      Plaintiffs brought suit for the commission in superior court.  After
 trial without a jury, the court issued findings of fact and conclusions of
 law, holding that plaintiffs were entitled to the commission.
      Defendants' first argument on appeal is that the undisputed testimony
 showed there was constructive fraud as a matter of law, and that such fraud
 defeats plaintiffs' right to a commission.  The constructive fraud claim is
 that because plaintiffs were in a fiduciary relationship with defendants,
 plaintiffs had a duty to disclose that defendants could not cancel the
 contract after plaintiffs produced a ready, willing and able buyer. (FN1)
      The problem with this claim is that it is totally different from that
 presented to the trial court.  The trial court asked each party to detail
 the elements of their claim or defense.  In response, defendants stated that
 they had to prove that "Plaintiffs or their agent intentionally misrep-
 resented a material fact, which was relied upon by the injured party, and
 that fact related to the subject matter of the contract."  The trial court
 specifically relied on defendants' statement of the elements of the defense
 and found that there was no intentional misrepresentation of fact.  Without
 contesting the court's findings,(FN2) defendants seek on appeal to change their
 theory of the case and have us rule that they can prevail based on non-
 disclosure, rather than on misrepresentation.
      We will not ordinarily consider issues raised for the first time on
 appeal.  O'Brien v. Island Corp., 156 Vt. ___, ___, 596 A.2d 1295, 1299
 (1991).  We see no reason to deviate from this rule in this case.  The
 trial court specifically asked defendants to detail their theory and
 followed it in making findings.  Had defendants raised their nondisclosure
 theory below, we are confident that the trial court would have made
 appropriate findings and addressed it.  We would be abandoning preservation
 requirements entirely in allowing this change of theory on appeal.
      Defendants' second argument on appeal is that the listing agreement is
 invalid because it fails to comply with Rule 26 of the Rules of the Vermont
 Real Estate Commission because (1) the identification of the type of listing
 agreement at the top of the document fails to comply with Rule 26(c)(1); and
 (2) the agreement contains an incorrect termination date in violation of
 Rule 26(c)(5).  With respect to the first claim, Rule 26(c)(1) requires that
 the agreement contain:
         (1) Identification of the type of listing agreement in
         boldface type at the top stating only one of the
         following:

         NONEXCLUSIVE (open)
         EXCLUSIVE AGENCY
         EXCLUSIVE RIGHT TO SELL

 The listing agreement in this case is headed "EXCLUSIVE RIGHT TO LIST AND
 SALES AUTHORIZATION."  Defendants argue that since the words are not
 identical to those in the rule, the agreement does not comply with the rule.
      Defendants' second claim is based on Mr. Griffin's failure to change
 the listing period from twelve months to thirty days as agreed by the
 parties.  Rule 26(c)(5) requires each listing agreement to contain the
 "specific expiration date."
      There is no claim of prejudice with respect to either claimed violation
 of the rules.  There was no confusion about what type of listing agreement
 was involved, and nothing to suggest that the agreement heading affected the
 dealings between the parties.  Because the prospective purchaser was
 obtained well within the thirty-day deadline, to which the parties agreed,
 the failure to amend the agreement to show the actual termination date was
 of no consequence.
      Nevertheless, defendants argue that, under Green Mountain Realty, Inc.
 v. Fish, 133 Vt. 296,