Opinion ID: 1710574
Heading Depth: 1
Heading Rank: 2

Heading: Effect of sec. 240.10, Stats.

Text: As to respondent's, Mrs. Lease's, demurrer to the third cause of action on the basis that there are insufficient facts to constitute the action, it is essential to bear in mind the two separate types of agency relationship which are involved. The first agency is between the deceased, Mr. Lease, and Thorp. The second claimed agency, which forms the basis for the third cause of action, is between the deceased and his wife. Mrs. Lease asserts that sec. 240.10, Stats., precludes Thorp from attempting to prove the second agency relationship inasmuch as such relationship does not appear on the face of the contract. Sec. 240.10, Stats., is an extension of the statute of frauds, designed to prohibit recovery for services where there is no written contract. [6] 240.10 Real Estate agency contracts. (1) Every contract to pay a commission to a real estate agent or broker or to any other person for selling or buying real estate shall be void unless such contract or note or memorandum thereof describing such real estate, expressing the price for which the same may be sold or purchased, the commission to be paid and the period during which the agent or broker shall procure a buyer or seller, be in writing and be subscribed by the person agreeing to pay such commission. This statute is designed to prohibit the introduction of parol evidence to prove the first agency relationship herethat between Mr. Lease and Thorp. The question posed by Mrs. Lease's demurrer to the third cause of action, however, is whether this same statute bars parol evidence to prove the second agency relationshipthat between Mr. Lease and his wife. Respondent argues that the action is barred by the statute, while appellant contends that it has the right to produce evidence of the agency relationship. The purpose of this statute is to protect the public from dishonest real estate agents. [7] It was not intended to govern the relationships between joint owners of property. Where an agent entered into an oral agreement with his principal to jointly purchase the land and then refused to honor the agreement an oral contract would not be barred by the statute of frauds and a constructive trust is created. [8] The rule in other jurisdictions [9] is that an oral agreement between husband and wife for one to act as the agent for the other is not invalidated by the statute of frauds. Consistent with this rule is Genske v. Leutner, [10] wherein this court held that an oral agreement of agency between husband and wife is enforceable and not rendered invalid by the statute of frauds or sec. 240.10, Stats. [11] The complaint in this case alleges an agency relationship and subsequent ratification by the parties of the relationship. Under such facts, a valid cause of action is alleged. The demurrer was properly overruled. By the Court. Order affirmed. No costs on appeal.