Wisconsin Court of Appeals rules offer valid despite contingency.

• Author: Ziemer, David

Byline: David Ziemer

Every attorney who does residential real estate closings knows what it is to shake his head after being hired for a closing and reading a poorly drafted offer to purchase.

It's common to think, This would be a lot easier if they had hired me before they signed this.

And a Nov. 25 opinion from the Wisconsin Court of Appeals suggests even the most poorly drafted offers are enforceable.

The court held that the following contingency did not render the offer either indefinite or illusory: offer is subject to sellers obtaining home of their choice on or before a date two days after the offer was signed.

The court held the contingency was ambiguous, but in light of extrinsic evidence, it could give a sufficiently definite meaning to the phrase for the contract to be enforceable.

On Feb. 18, 2007, Paul and Teresa Donovan signed an offer to purchase the home of Terry and Vicki Vohs for $550,000. It contained the above contingency. The Vohs accepted the offer on the same date.

According to the Vohs, they had a pending counteroffer to purchase another home, which had to be accepted on or before Feb. 19. On that day, the counteroffer was accepted, and the Vohses' broker informed the Donovans that the contingency had been met.

However, the Donovans did not follow through with the purchase, and the Vohses subsequently sold the home for less. They then brought suit against the Donovans for breach of contract.

Rock County Circuit Court Judge Daniel T. Dillon granted summary judgment in favor of the Donovans, concluding the contingency made the contract unenforceable.

The Vohses appealed, and the Court of Appeals reversed in an opinion by Judge Margaret J. Vergeront.

The court began with an explanation of the difference between indefinite and illusory contract terms.

The definiteness requirement refers to mutual assent, while an illusory promise is one that does not constitute consideration.

Addressing indefiniteness...