Whalen v. Bistes
| Docket Number: | 2009-CA-00660-COA | |
| Court of Appeals: |
Opinion Link Opinion Date: 09-28-2010 Opinion Author: Maxwell, J. Holding: Affirmed. |
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| Additional Case Information: |
Topic: Real property - Dual agency - Section 73-35-21(1)(e) - Unclean hands - Section 73-35-1 - Attorney's fees - M.R.A.P. 38 Judge(s) Concurring: King, C.J., Lee and Myers, P.JJ., Irving, Griffis, Barnes, Ishee, Roberts and Carlton, JJ. Procedural History: Summary Judgment Nature of the Case: CIVIL - REAL PROPERTY |
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| Trial Court: |
Date of Trial Judgment: 02-06-2009 Appealed from: Harrison County Chancery Court Judge: Jim Persons Disposition: SUMMARY JUDGMENT GRANTED TO DEFENDANTS Case Number: 05-01583 |
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| Party Name: | Attorney Name: | Brief(s) Available: | ||
| Appellant: | Michael Whalen |
D. SCOTT GIBSON |
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| Appellee: | Gregory Bistes, Jr. and Gay Bistes Palmisano | EDWARD O. MILLER, HOLLIE MATHIS MILLER | ||
Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Real property - Dual agency - Section 73-35-21(1)(e) - Unclean hands - Section 73-35-1 - Attorney's fees - M.R.A.P. 38 |
| Summary of the Facts: | Michael Whalen sought specific performance or, alternatively, damages for breach of contract, relating to a land-sale agreement he attempted to broker between Gregory Bistes Jr. and the Bradshaw Family Limited Partnership. The chancellor granted summary judgment in Bistes’s favor and found that Whalen’s undisclosed dual-agency representation of both Bistes and the Partnership made delivery ineffective and rendered the contract unenforceable. The chancellor also held that because Whalen lacked a real-estate license while acting as a realtor and brokering the land acquisition, he entered court with unclean hands and could not seek equity. Whalen appeals. |
| Summary of Opinion Analysis: | Issue 1: Dual agency It is undisputed Whalen acted as an agent for the buyer – the Partnership. Whalen also admitted during his deposition he had acted as the seller’s (Bistes’s) agent and as a dual agent. However, Whalen admits he never informed Bistes of the dual-agency relationship, nor did he request that Bistes execute a dual-agency acknowledgment. Further, the contract at issue does not state who Whalen represented in the land transaction. The Mississippi Real Estate Commission requires that an agent involved in a dual-agency arrangement ensure both parties explicitly acknowledge the dual relationship on a form provided by the Commission. Dual representation by realtors is permitted under section 73-35-21(1)(e) if the dual representation takes place with the full knowledge of all parties. Under traditional agency law, knowledge and information acquired by an agent transacting the principal’s business is imputed to the principal, even if not communicated by the agent to the principal. Whalen argues this imputed-knowledge theory should apply equally in the realm of undisclosed dual agencies and that the knowledge he acquired from the Partnership was imputed to his other principal, Bistes. Whalen presents no authority that a valid dual agency may exist in the real-estate context without one of the principal’s knowledge. Nor does he provide precedent that knowledge is imputed from agent to principal in undisclosed dual-agency relationships. Traditional agency principles suggest Whalen’s failure to disclose the nature of his dual representation renders the contract voidable at Bistes’s election. Where an agent undertakes to act for both parties to a contract without their knowledge of and consent to the dual agency, and the nature of the duties of the agent requires the exercise of judgment and discretion, the dual representation is contrary to public policy and the contract is voidable at the election of either principal. The right to void the contract applies regardless of whether the principal suffered an actual injury. It is undisputed that Whalen never admitted the true nature of his dual relationship to Bistes. Further, the quasi-straw assignment from which Whalen now seeks to benefit to the detriment of his former principal offends public policy. Issue 2: Unclean hands Whalen failed to address the clean-hands doctrine in his brief. But it is apparent from the record that Whalen was not a licensed real-estate broker at the time he set out to arrange the land transaction between Bistes and the Partnership. The chancellor found Whalen violated section 73-35-1 by acting as a real-estate broker without a valid license. Whalen does not and cannot dispute that he violated Mississippi law when he posed as a licensed broker and sought a commission from the real-estate deal. Thus, the chancellor did not err in relying on deeply rooted equitable maxims in refusing to enforce the contract or award damages for the alleged breach. Issue 3: Attorney’s fees Bistes argues Whalen’s appeal is frivolous and seeks attorney’s fees under M.R.A.P. 38. The inquiry for an award under this rule turns on whether a reasonable person would have any hope for success. While Whalen’s arguments lack merit, they are not frivolous. |
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