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Botticello v. Stefanovicz - 177 Conn. 22, 411 A.2d 16 (1979)

Rule:

"Agency" is defined as the fiduciary relationship which results from manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act. Thus, the three elements required to show the existence of an agency relationship include: (1) a manifestation by the principal that the agent will act for him; (2) acceptance by the agent of the undertaking, and; (3) an understanding between the parties that the principal will be in control of the undertaking.

Facts:

Defendants Mary and Walter Stefanovicz, husband and wife, each held an undivided one-half interest in a farm. In the fall of 1965, plaintiff Anthony Botticello became interested in the property. When he first visited the farm, Walter advised him that the asking price was $100,000. The following January, plaintiff again visited the farm and made a counteroffer of $75,000. At that time, Mary stated that there was no way she could sell the farm for that amount. Ultimately, plaintiff and Walter agreed upon a price of $85,000 for a lease with an option to purchase; the agreement was signed by Walter and by plaintiff. Neither plaintiff nor his attorney, nor Walter's attorney, was then aware of the fact that Walter did not own the property outright. Furthermore, Walter never represented to plaintiff or his attorney, or his own attorney that he was acting for his wife, as her agent. Shortly after the execution of the lease and option to purchase plaintiff took possession of the property, made substantial improvements to it, and properly exercised his option to purchase. Defendants then refused to honor the option agreement, prompting plaintiff to commence an action against defendants in Connecticut state court to seek specific performance, possession of the premises, and damages. The trial court ruled in favor of plaintiff and ordered specific performance of the option-to-purchase agreement. The trial court held that Walter acted as Mary's authorized agent in the execution of the contract. Defendants appealed, arguing that Mary was never a party to the agreement, and thus, its terms could not be enforced as to her.

Issue:

Can the terms of the option-to-purchase agreement be enforced as to Mary Stefanovicz, a person who was never a party to the agreement?

Answer:

No.

Conclusion:

The reversed the judgment as to Mary and directed the trial court to enter judgment in her favor. The court ordered a new trial on the issue of relief with respect to the judgment against Walter. The court ruled that the trial court's finding were wholly insufficient to support its conclusion that Walter acted as the Mary's authorized agent in the discussions concerning the sale and in the execution of the contract. Moreover, the court noted that there was no evidence that Mary ratified the underlying contract. Thus, the court concluded that Mary was not bound by the agreement and she could not be forced to convey her interest. The court then ruled that Walter could contract on behalf of himself. A new trial was necessary, however, because plaintiff was entitled either to Walter's defective title or damages, but not specific performance as to the Mary's interest.

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