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Busciglio v. Della Fave

2005 WL 1606060 (N.J. Super. Ch. Div. 2005) (Unpublished)

CONTRACTS; ATTORNEYS; AGENCY—An attorney at law may bind his or her client to a real estate contract if the client granted such authority and the attorney carried out the client’s instructions.

On remand from the Appellate Division, the Chancery Division conducted a plenary trial on the issue of express or implied authority. Basically, a real estate broker’s form of contract was sent to the attorneys representing each side of a purchase transaction. The buyer’s attorney faxed a disapproval of the contract to the seller’s attorney, “but proposed an amendment in the form of a contract rider, which he signed as buyer’s attorney. He wrote that he would accept the seller’s attorney’s signature on behalf of the seller. It was his intention that the contract would be revived if the rider were fully signed. Three days later, the seller’s attorney “replied by fax, proposing a series of changes to the contract and the rider. That same day, [the seller’s attorney] signed that letter as ‘approved’ for his client and faxed it back” to the buyer’s attorney. The next day, the buyer’s attorney wrote the seller’s attorney, returning the seller’s attorney’s rider “signed by me [the buyer’s attorney] on behalf of my client and noticing it is subject to my letter ..., [which] you have approved.” That faxed letter also included two other changes that had been agreed-upon. However, on the very next day, the seller’s attorney wrote to the buyer’s attorney advising “my client has requested that I not revive the contract of sale.”

At trial, the seller acknowledged that her attorney represented her when she originally bought the property and that she had given the real estate broker his name for this particular sale when the broker’s form of contract of signed. Further, she “expressly orally authorized him to ‘cancel’ (more specifically ‘not revive’) the contract” which he had claimed to have done in his final letter. She testified that she had never authorized her attorney to sign for her, “nor did he suggest he would sign for her.” She owned the property together with her son who appeared to have little to say in the transaction. The son “deferred to his mother to handle the entire transaction for the two of them.” The seller’s attorney “testified that when he signed, he was signing ‘as to form’ and that he does ‘not sign riders for clients.’”

The Court thought that the testimony of the seller and the seller’s attorney “seemed scripted for this trial.” Nonetheless, it held that the testimony confirmed that the seller’s attorney had authority from the seller and from her son to sign for them on the “new offer” submitted by the buyer’s attorney “and to which [the seller’s attorney] appended revisions that themselves were accepted by [the seller].” The Court believed that when the seller’s attorney said that “his signing was ‘as to form,’” he was expressing a new version of past events that was in fact contrary to “[h]is earlier position [] that he did not have authority to sign.” According to the Court, if the seller’s attorney “intended to sign with such limitation, he would and should have so noted that limitation on the document or in his correspondence.” Further, the seller’s attorney testified that “he was following the instructions of his client ‘to keep the deal alive.’” Further, his client, the seller, testified that she and her attorney “had discussed the changes on the telephone and [she] asked [her attorney] if they seemed all right with him.” Her testimony to the effect that the last time she spoke with her attorney before her attorney signed the rider on her behalf was that she needed to speak with her son. The Court rejected that on the basis of a lack of credibility because her son “appeare[d] to have had virtually no say in this transaction.” Consequently, the Court believed that the seller “wanted to be able to assert inconsistent positions at the same time, both being bound and not bound to a contract for the sale of her home, retreating to the position that met her needs at that moment.” After analyzing all of the testimony, the Court concluded that the seller had granted authority to her attorney to sign for her and her son and that her attorney had carried out her instructions. Consequently, the Court held that the seller was obligated to convey title in accordance with the contract.

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