VAN ETTINGER v PAPPIN
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No. 14253 IN THE SUPREME COURT OF THE STATE MONTANA 1978 ROBERT C. VAN ETTINGER and RUTH E. VAN ETTINGER, husband and wife, Plaintiff and Appellant, ROBERT F. PAPPIN et al., Defendants and Respondents. Appeal from: District Court of the Eighth Judicial District, Honorable Joel G. Roth, Judge presiding. Counsel of Record: For Appellant: Richter and Lerner, Billings, Montana Alan J. Lerner argued, Billings, Montana Hartelius and Lewin, Great Falls, Montana For Respondents: Swanberg, Koby, Swanberg & Matteucci, Great Falls, Montana John Alke argued, Great Falls, Montana Submitted: November 22, 1978 Decided: D F 2 1 -- 1978 Mr. J u s t i c e Gene B. Daly d e l i v e r e d t h e Opinion of t h e C o u r t . T h i s i s an a p p e a l by t h e p l a i n t i f f s from summary judgment e n t e r e d i n b e h a l f of t h e d e f e n d a n t s by t h e D i s t r i c t C o u r t of t h e E i g h t h J u d i c i a l D i s t r i c t , County of Cascade, t h e Honorable J o e l G. Roth s i t t i n g w i t h o u t a j u r y . On December 3, 1975, t h e Van E t t i n g e r s , a p p e l l a n t s , f i l e d t h i s a c t i o n f o r damages a r i s i n g o u t of a c o n t r a c t f o r t h e s a l e of r e a l e s t a t e under which t h e y p u r p o r t e d l y purc h a s e d a n easement f o r t h e u s e o f a swimming p o o l . The c o m p l a i n t a l l e g e d b r e a c h of c o n t r a c t , f r a u d , n e g l i g e n c e and v i o l a t i o n of t h e R e a l E s t a t e L i c e n s e A c t by d e f e n d a n t respondents. Respondents a r e t h e P a p p i n s , p r i o r owners of t h e house; Tom Mather, James Durkin and Tom Mather & Asso- c i a t e s , t h e r e a l t o r s i n v o l v e d i n t h e s a l e ; and Western S u r e t y Company, t h e r e a l t y bonding company. D e p o s i t i o n s were t a k e n and i n t e r r o g a t o r i e s w e r e exchanged. On J u n e 30, 1977, r e s p o n d e n t s f i l e d a motion f o r summary judgment on a l l of a p p e l l a n t s ' c l a i m s f o r r e l i e f . On September 2 6 , 1977, a p p e l l a n t s f i l e d a c r o s s - m o t i o n f o r p a r t i a l summary judgment on t h e i s s u e s o f l i a b i l i t y on a l l c l a i m s and on t h e i s s u e of s t a t u t o r y damages and e n t i t l e m e n t t o a t t o r n e y f e e s under t h e Real E s t a t e L i c e n s e Act. F o l l o w i n g o r a l argument on November 7 , 1977, on t h e mutual m o t i o n s f o r summary judgment, t h e D i s t r i c t C o u r t e n t e r e d f i n d i n g s of f a c t , c o n c l u s i o n s of l a w , and a n o r d e r g r a n t i n g r e s p o n d e n t s ' motion f o r summary judgment and denyi n g a p p e l l a n t s ' c r o s s - m o t i o n f o r summary judgment. On a p p e a l a p p e l l a n t s do n o t c o n t e s t t h e D i s t r i c t C o u r t ' s r u l i n g t h a t a c l a i m o f n e g l i g e n c e under t h e c i r c u m s t a n c e s s t a t e s no c a s e upon which r e l i e f c a n be g r a n t e d . They do c o n t e s t t h e d i s m i s s a l of t h e c o u n t s a l l e g i n g breach of c o n t r a c t , f r a u d , and v i o l a t i o n of t h e Real E s t a t e License Act. T h i s c a s e i n v o l v e s t h e u s e of a swimming pool which s t r a d d l e s two l o t s , numbered 29 and 30, i n a G r e a t F a l l s , Montana, s u b d i v i s i o n . Two a d d i t i o n a l l o t s , numbered 13 and 1 4 , a r e involved i n t h e c o n t r o v e r s y . The l o t s a b u t one a n o t h e r a s diagrammed: Alder S t r e e t pool Beach S t r e e t I n 1961 d e f e n d a n t Robert Pappin owned l o t s 1 4 and 29 and d e f e n d a n t Tom Mather owned l o t s 13 and 30. A t t h a t time t h e y agreed t o j o i n t l y develop l o t s 29 and 30. A s p a r t of t h i s development, t h e y b u i l t a swimming pool s t r a d d l i n g l o t s 29 and 30. Mather subsequently s o l d l o t 30 t o t h e Penning- t o n s , who along w i t h t h e Pappins, s t i l l t h e owners of l o t 29, executed and recorded i n September, 1961, an easement f o r t h e u s e of t h e swimming pool i n f a v o r of each o t h e r . This easement does n o t mention e i t h e r l o t 13 o r 1 4 . I n October, 1 9 6 1 , a n o t h e r easement agreement was drawn, p u r p o r t e d l y between t h e owners of a l l f o u r l o t s , whereby t h e owners of l o t s 29 and 30 g r a n t e d a permanent easement f o r t h e u s e of t h e pool t o t h e owners of l o t s 13 and 1 4 . Under t h i s agreement t h e c o s t s n e c e s s a r y t o u s e of t h e pool were t o be borne e q u a l l y by t h e p a r t i e s . This easement was n o t recorded nor was t h e name o r s i g n a t u r e of t h e owner of l o t 29 p r o v i d e d . I t a p p e a r s t h a t a t t h e t i m e of t h e e x e c u t i o n of t h i s i n s t r u m e n t P a p p i n s s t i l l owned b o t h l o t s 1 4 and 29; t h e Mathers s i g n e d a s owners of l o t 13; and t h e P e n n i n g t o n s s i g n e d a s owners of l o t 30. A t t h e t i m e of t h e i n c i d e n t s complained of i n t h i s c a s e , l o t 29 w a s owned by t h e Nobles, l o t 30 by t h e Howrys, and l o t 1 3 by t h e Mathers u n t i l J a n u a r y 1, 1974, and t h e Huffords t h e r e a f t e r . Although t h e ownership of t h e v a r i o u s l o t s changed o v e r t i m e , t h e u n r e c o r d e d easement agreement was honored by a l l s u b s e q u e n t owners. I n August, 1973, however, t h e P a p p i n s s e n t a l e t t e r t o t h e "Members of t h e Swimming Pool Associat i o n " s t a t i n g t h a t a s a r e s u l t of t h e i r move t o a downtown a p a r t m e n t t h e y w e r e " r e s i g n i n g from t h e swimming p o o l " and s e e k i n g i n s t r u c t i o n s a s t o whether t h e r e m a i n i n g members " w i s h [ e d ] t h e new owners t o p a r t i c i p a t e i n t h e swimming p o o l o r i f [ t h e y ] would p r e f e r t o r e t a i n i t among t h e t h r e e p r e s e n t members." T h e r e a f t e r t h e Pappins d i d n o t c o n t r i b u t e t o t h e upkeep of t h e p o o l . I n September, 1973, t h e Pappin home l o c a t e d on l o t 1 4 was l i s t e d f o r s a l e w i t h Tom M a t h e r ' s r e a l e s t a t e agency. P a p p i n , a s a r e a l e s t a t e salesman i n t h i s agency, r e c e i v e d a $386.50 l i s t i n g commission. Without t h e knowledge of P a p p i n , however, Tom Mather i n d i c a t e d on t h e m u l t i p l e l i s t i n g employment c o n t r a c t t h a t i n c l u d e d i n t h e s a l e of t h e house w a s a " p e r p e t u a l easement f o r p o o l u s e v i a 1 / 4 e x p e n s e s s h a r i n g " . The m u l t i - l i s t i n g agreement and newspaper a d v e r t i s e m e n t s f o r t h i s p r o p e r t y p r e p a r e d from t h e m u l t i p l e l i s t i n g employment c o n t r a c t b o t h mentioned t h e easement f o r t h e u s e of t h e pool. I n May, 1974, R o b e r t Van E t t i n g e r , i n t e n d i n g t o move w i t h h i s f a m i l y from C a l i f o r n i a t o Great F a l l s , s i g n e d a b u y - s e l l agreement w i t h t h e Pappins. p his agreement con- t a i n e d t h r e e r e f e r e n c e s t o t h e swimming pool: "The f o l l o w i n g p e r s o n a l p r o p e r t y i s a l s o t o be l e f t upon t h e premises a s a p a r t of t h e p r o p e r t y and easement f o r pool u s e purchased. ... .. " * I t i s understood by t h e buyer t h a t t h e pool i s owned by L o t s 29 and 3 0 , Block 7, Country Club Addition and t h a t Lot 1 4 has had t h e r i g h t of easement f o r u s e by c o n t r i b u t i n g one-fourth ( 1 / 4 ) of t h e c o s t of maintanance ( s i c ) , operat i o n and t a x e s . "The u s e of t h e pool r e q u i r e s t h e buyer t o pay 1 / 4 of t h e c o s t of t h e o p e r a t i o n of t h e p o o l . " I n e a r l y J u l y , 1974, a f t e r t a l k i n g t o t h e owners of l o t s 29 and 3 0 , Van E t t i n g e r became concerned t h a t he and h i s f a m i l y would n o t be allowed t o u s e t h e swimming pool. He was a s s u r e d by t h e r e a l e s t a t e agency t h a t t h e y would be allowed t o u s e t h e pool. O J u l y 2 0 , p r i o r t o f i n a l c l o s i n g of t h e s a l e , a p p e l n l a n t s moved i n t o t h e house on l o t 1 4 . O t h e same day t h e n a c c e s s g a t e between l o t 1 4 and t h e pool was removed by t h e owners of l o t s 29 and 30. O J u l y 2 1 Van E t t i n g e r t r i e d t o n u s e t h e pool and was p r o h i b i t e d from doing s o by Howry, who t h r e a t e n e d t o have him a r r e s t e d f o r t r e s p a s s . O July 22 n Van E t t i n g e r hand d e l i v e r e d a l e t t e r t o T m Mather demanding o he r e c t i f y t h e pool s i t u a t i o n c r e a t e d by t h e Nobles' and Howrys' r e f u s a l t o l e t them u s e t h e pool. Mather t a l k e d t o t h e Nobles and Howrys and t r i e d t o convince them t o a l l o w a p p e l l a n t s t h e u s e of t h e swimming pool. They r e f u s e d , and Mather t h e n t a l k e d t o a p p e l l a n t s on J u l y 2 6 , a d v i s i n g them t h a t t h e Nobles and Howrys would n o t a c q u i e s c e t o t h e i r u s e of t h e pool. To p l a c a t e a p p e l l a n t s Mather o f f e r e d a t t h a t time t o buy them a c o u n t r y c l u b membership which would a l l o w them u s e of t h e c o u n t r y c l u b ' s p o o l . I n s p i t e of t h e s e e v e n t s a p p e l l a n t s c l o s e d t h e i r l o a n a p p l i c a t i o n w i t h t h e l e n d i n g i n s t i t u t i o n on J u l y 28, 1974, and c l o s e d t h e s a l e t r a n s a c t i o n on J u l y 30. After closing the transaction, appellants f i l e d the instant action. The f o l l o w i n g i s s u e s are p r e s e n t e d t o t h i s C o u r t f o r review: 1. Whether t h e D i s t r i c t C o u r t e r r e d i n g r a n t i n g r e - s p o n d e n t s ' motion f o r summary judgment on a p p e l l a n t s ' c o u n t a l l e g i n g b r e a c h of c o n t r a c t ? 2. Whether t h e D i s t r i c t C o u r t e r r e d i n g r a n t i n g r e - s p o n d e n t s ' motion f o r summary judgment on a p p e l l a n t s ' c o u n t a l l e g i n g fraud? 3. Whether t h e D i s t r i c t C o u r t e r r e d i n d e n y i n g a p p e l - l a n t s ' motion f o r p a r t i a l summary judgment on t h e i r c o u n t a l l e g i n g v i o l a t i o n o f t h e Real E s t a t e L i c e n s e Act of 1963 and i n g r a n t i n g r e s p o n d e n t s ' motion f o r summary judgment on a p p e l l a n t s ' c o u n t a l l e g i n g v i o l a t i o n of t h e Real E s t a t e L i c e n s e A c t of 1963? I t i s most p r o d u c t i v e t o b e g i n a n a l y z i n g t h i s problem from t h e l a s t e v e n t s backwards and d e t e r m i n e t h e e f f e c t on t h e v a r i o u s c a u s e s of a c t i o n of a p p e l l a n t s p r o c e e d i n g t o c l o s i n g t h e sales t r a n s a c t i o n . T h i s e f f e c t i s s e e n most c l e a r l y on t h e c o n t r a c t t h e o r y i n a p p e l l a n t s ' c o m p l a i n t . D e s p i t e t h e a s s e r t i o n by a p p e l l a n t s t h a t t h e y c l o s e d t h e t r a n s a c t i o n on J u l y 20, t h e r e c o r d i t s e l f i n d i c a t e s t h e t r a n s a c t i o n d i d n o t c l o s e u n t i l between J u l y 28 and 30. In h i s d e p o s i t i o n M r . Van E t t i n g e r h i m s e l f s t a t e s it w a s between t h e 2 8 t h and 3 0 t h of J u l y when he s i g n e d t h e p a p e r s a t t h e bank. The w a r r a n t y deed from P a p p i n s t o a p p e l l a n t s , a document o f p u b l i c r e c o r d , w a s n o t e x e c u t e d u n t i l J u l y 29 and was n o t d e l i v e r e d t o a p p e l l a n t s u n t i l ~ u l y 30. In a d d i t i o n a p p e l l a n t s remained i n p o s s e s s i o n of t h e house a t l e a s t u n t i l A p r i l 29, 1976, when t h e i r d e p o s i t i o n s were taken. I n view of t h i s r e c o r d a p p e l l a n t s ' s i m p l e a s s e r t i o n t h a t t h e t r a n s a c t i o n c l o s e d on J u l y 20 w i l l n o t s e r v e t o c r e a t e a n i s s u e of f a c t m e r e l y t o a v o i d summary judgment. Brown v . Thornton ( 1 9 6 7 ) , 150 Mont. 1 5 0 , 155, 432 P.2d 386, The d e t e r m i n a t i o n t h a t t h e t r a n s a c t i o n c l o s e d between J u l y 28 and 30 means t h e e v e n t s t a k i n g p l a c e u n t i l t h e n must be c o n s i d e r e d i n d e t e r m i n i n g t h e e f f e c t of a p p e l l a n t s ' decision t o close the sale. Between J u l y 20 and 28, a p p e l - l a n t s w i t n e s s e d t h e removal of t h e a c c e s s g a t e t o t h e s w i m ming p o o l on J u l y 20, t h e d a t e t h e y moved i n t o t h e house on l o t 1 4 ; M r . Van E t t i n g e r was t h r e a t e n e d w i t h a r r e s t f o r t r e s p a s s i n g when h e a t t e m p t e d t o u s e t h e p o o l on J u l y 21; and d e f e n d a n t Tom Mather, a f t e r t a l k i n g t o t h e owners of l o t s 29 and 30, informed a p p e l l a n t s on J u l y 26 t h a t t h e s e p a r t i e s r e f u s e d t o a l l o w them u s e of t h e p o o l . D e s p i t e t h e s e g r a p h i c i n d i c a t i o n s from t h e o t h e r p a r t i e s t h a t t h e r e m i g h t be d e f e c t s i n t h e p u r p o r t e d easement and t h e a p p a r e n t a c q u i e s c e n c e by one of t h e r e a l t o r s i n v o l v e d i n t h e m a t t e r , a p p e l l a n t s proceeded t h r o u g h f i n a l c l o s i n g s t a g e s of t h e s a l e s t r a n s a c t i o n and remained i n poss e s s i o n of t h e house. C l a u s e 3 of t h e sales c o n t r a c t b e i n g sued upon s t a t e s : " I f t h e s e l l e r d o e s n o t approve t h e s a l e w i t h i n two d a y s h e r e a f t e r , o r i f s e l l e r ' s t i t l e i s n o t m e r c h a n t a b l e o r i n s u r a b l e and c a n n o t be made s o within a reasonable t i m e a f t e r w r i t t e n notice c o n t a i n i n g s t a t e m e n t of d e f e c t s i s d e l i v e r e d t o s e l l e r , t h e n s a i d e a r n e s t money h e r e i n rec e i p t e d f o r s h a l l be returned t o t h e purchaser on demand and a l l r i g h t s of p u r c h a s e r t e r m i n a t e d u n l e s s p u r c h a s e r waives s a i d d e f e c t s and (Emphasis a d d e d . ) elects -purchase." to C he deed given by the Pappins to appellants conveyed all of the pappins' rights, title, and interest in lot 14 as well as all easements attached thereto. 67-1523, 67-1607, R.C.M. 1947. Sections 67-1522, Appellants chose to waive any defects in Pappins' title when they agreed to close the transaction. This waiver was made with the knowledge of a possible dispute over the easement and effectively precludes any remedy based on a contract theory. Appellants' decision to close the sale also served in part to waive any claim for relief based on fraud. In this case Mr. Van Ettinger's desposition shows he had conducted independent investigations which revealed unequivocally that the Nobles and Howrys, as owners of lots 29 and 30, would refuse appellants access to the pool. In fact he was so advised for the first time even before he signed the buysell agreement. Throughout this period of time he asserts he was fraudulently reassured by defendant realtors that everything would be all right with the easement. True as this may be, on July 26 Tom Mather flatly told appellants they would not be allowed to use the pool by the other owners and offered to pay for a membership in the country club as an alternative. Clearly, any claim that the reassurance continued past this date is unfounded. Yet appellants proceeded to close the transaction. Appellants must have the ability to make a prima facie showing of nine elements for their fraud claim to survive. These elements are identified in Bails v. Gar (1976), 171 Mont. 343, 558 P.2d 458, 461, 33 St.Rep. 1256, 1259; Cowan v. Westlund Realty (1973), 162 Mont. 379, 383, 512 ~ . 2 d 714, 716; and Clough v. Jackson (1971), 156 Mont. 272, 279-80, 479 P.2d 266, 270: 1. A representation; 2. Falsity of the representation; 3. Materiality of the representation; 4. Speaker's knowledge of the falsity of the repre- sentation or ignorance of its truth; 5. Speaker's intent it should be relied upon; 6. The hearer's ignorance of the falsity of the repre- sentation; 7. The hearer's reliance on the representation; 8. The hearer's right to rely on the representation; 9. Consequent and proximate injury caused by the and reliance on the representation. Even the excerpts taken from appellants' version of what happened show, that at the very least, they cannot make a prima facie showing of elements six through eight. In the first place appellants cannot show their ignorance of the falsity of respondents' alleged representations. From the very beginning, they knew the opposite--that the Nobles and Howrys would refuse to let them use the swimming pool. According to Mr. Van Ettinger, this knowledge was obtained before he signed the buy-sell agreement. Appellants knew at all times the Nobles' and Howrys' statements were in direct opposition to those alleged to have been made by respondents, and they knew it was the actions of the other owners which would dictate their ability to use the pool, not the actions of the real estate people. ~dditionally,appellants cannot show reliance, the seventh element. They elected to purchase lot 14 despite three warnings from the Nobles and Howrys that they would not be able to use the pool, despite the events of ~ u l y20 (removal of t h e a c c e s s g a t e ) , J u l y 21 ( a r r e s t t h r e a t f o r t r e s p a s s ) and J u l y 26 ( M a t h e r ' s n o t i f i c a t i o n t h a t t h e Nobles and Howrys would n o t a l l o w a p p e l l a n t s t o u s e t h e p o o l and h i s o f f e r of a c o u n t r y c l u b membership a n a n a l t e r n a t i v e ) . Assuming f r a u d u n t i l J u l y 20, a p p e l l a n t s ' a c t i o n s a f t e r t h a t d a t e make any c l a i m of r e l i a n c e u n s u p p o r t a b l e . A p p e l l a n t s c o u l d n o t r e l y on t h e a l l e g e d r e p r e s e n t a t i o n s of r e s p o n d e n t s a s a m a t t e r of law. I n Lee v. Stock- mans N a t i o n a l Bank ( 1 9 2 2 ) , 63 Mont. 262, 284, 207 P. 623, 630, i t was s t a t e d : "When it a p p e a r s t h a t a p a r t y , who c l a i m s t o have been d e c e i v e d t o h i s p r e j u d i c e , h a s i n v e s t i g a t e d f o r h i m s e l f , o r t h a t t h e means were a t hand t o a s c e r t a i n t h e t r u t h of any r e p r e s e n t a t i o n s made t o him, h i s r e l i a n c e upon such r e p r e s e n t a t i o n s made t o him, however f a l s e they m a y -- a f f o r d s no ground of complaint, have been, ( G r i n r o d v . Anglo-American Bond Co. 34 Mont. 1 6 9 , 85 P. 891; Power & B r o t h e r s v. T u r n e r , 37 Mont. 521, 97 P. 950; 26 C . J . 1 1 4 9 . ) " (Emphasis added.) ... A p p e l l a n t s made a n i n d e p e n d e n t i n v e s t i g a t i o n i n t o t h e p o o l s i t u a t i o n , and t h e y are b a r r e d from now c l a i m i n g t h e p u r c h a s e was made i n r e l i a n c e on r e s p o n d e n t s ' m i s r e p r e s e n t a tions. Lowe v. Root ( 1 9 7 5 ) , 166 Mont. 1 5 0 , 1 5 6 , 531 P.2d An a l t e r n a t i v e ground f o r t h i s h o l d i n g i s t h e g e n e r a l r u l e as s t a t e d i n 37 Am.Jur.2d Fraud and D e c e i t 8394 a t 534- " A s a g e n e r a l r u l e , where a c o n t r a c t i s wholly e x e c u t o r y , n e i t h e r p a r t y h a v i n g performed any p a r t of i t , i f o n e p a r t y a s c e r t a i n s t h a t t h e o t h e r h a s been g u i l t y of f r a u d i n t h e proc u r i n g o r making of a c o n t r a c t o r w i t h r e f e r e n c e t o t h e s u b j e c t m a t t e r t h e r e o f , h e may r e p u d i a t e t h e c o n t r a c t , s i n c e it i s i n no way b i n d i n g upon him, and i n such c i r c u m s t a n c e s t h e d e f r a u d e d p a r t y may n o t remain s i l e n t a s t o t h e f r a u d and p e r f o r m t h e c o n t r a c t and t h e n It i s c l a i m damages f o r - t h e f r a u d . - - v e r y genera11 h e l d t h a t Y----o n e who d i s c o v e r s t h a t f r a u d h a s been p r a c t i c e d upon him w h i l e - t r a n s the -- e m a i n s w h o l--u t o r y , - n e v e r t h e action r ly exec but less either executes or performs - - it on his part or requires performance on - part of the -the other party, thereby waives the fraudand cannot subsequently maintain an action for damages therefor. " (~mphasisadded. ) Until appellants decided to close the sale on July 30, performance under the contract was executory for both parties. However, by July 26 appellants knew in no uncertain terms that the Nobles and Howrys would not allow them to use the pool. Additionally, Tom Mather had advised them that the Nobles and Howrys would not let them use the pool and offered them a country club membership. decided to close the sale on July 30. Yet appellants Until that point performance under the contract was executory for both parties with the exception of the earnest money paid to make the buy-sell agreement enforceable. On the date of July 30 appellants fully performed their obligation of payment of the purchase price and demanded performance from respondents Pappin, who in turn performed their obligation of conveyance. Appellants' decision to go through with the purchase constitutes a waiver of the alleged fraud and bars them from now posing that fraud as a claim for relief. Appellants' reliance on State ex rel. Dimler v. District Court (1976), 170 Mont. 77, 550 P.2d 914, is misplaced. In that case the defects in the purchased property were not discovered until the day following the purchase. at 79, 550 P.2d at 918. 170 Mont. In the instant action appellants received numerous, consistent, and graphic indications that there were problems with the use of the pool culminating with the apparent acceptance of the realtor selling them the house in the view that they would not be able to use the pool after all. All of these indications were given before closing the sale. One futher point concerning appellants' contract and fraud theories needs to be made. Appellants have not ac- tually litigated the existence of this easement against the other owners who are forbidding their use of the pool. Neither are these parties joined in this action. As it stands now, the current action is not the proper case to decide whether in fact an easement does exist for the simple reason that the owners of the purported servient estates (lots 29 and 30) as indispensable parties are not represented in this action and cannot have a binding judgment rendered against their possible interests or claims. 19, M.R.Civ.P. Rule Therefore, appellants have put the cart before the horse: They are suing under their contract and fraud theories for respondents' attempt to convey a nonexistent easement which has never been shown not to exist. The final issue presented by appellants has to do with the violation of the Real Estate License Act, section 661924, et seq., R.C.M. 1947, by the various real estate agents involved in this sale. At the time of these incidents section 66-1937, R.C.M. 1947, provided that a broker or agent may have his license suspended or revoked for: " (9) Offering real property -- or for sale lease without the knowledge and consent of the owner or his authorized agent or on any terms other than those authorized & the owner or his authorized agent." (Emphasis added. ) Subsection (b) and (c) of section 66-1940 creates civil penalties for violation of this Act. Under the statute these penalties may be recovered only "by any person aggrieved", subsection (b), or "[alny person sustaining damages", subsection (c), and see Denny v. Brissoneaud (1973), 161 Mont. 468, 474-75, 506 P.2d 77, 80. Clearly, appellants can qualify under neither subsection. In the first place, as discussed above, they have failed to establish the nonexistence of the easement and, therefore, cannot be considered aggrieved. Secondly, and more importantly, by closing the transaction they have waived any claim for damages. There- fore, even if, in fact, there was found to exist a technical violation of the Real Estate License Act, the same arguments that supported the District Court on the fraud and contract issues would apply equally well and support the court on this issue. We agree that the Real Estate Licence Act should be construed to lend maximum efficacy to the enforcement of the fiduciary relationships involved in this profession. v. Watson (1978), St.Rep. 550, 555. lightly. Mont . Carnell , 578 P.2d 308, 312, 35 This enforcement should not be taken Yet, the heavy penalties allowed to be added to common law damages would certainly envision that willful misconduct be present as opposed to a natural or what may be characterized as an "honest" mistake, regardless of the argument that another course of conduct or the lack of some negligence would have avoided the situation complained about. In this case, Tom Mather, the realtor apparently responsible for including the easement in the various listings, had himself been a long-time member of the "swimming pool association", serving as treasurer for the organization for many years. When his neighbor, associate and friend Robert Pappin's house came up for sale, he naturally hoped to emphasize what he considered its strongest selling points, which, to his personal knowledge, included a swimming pool easement. T h e r e i s no e v i d e n c e t o s u g g e s t t h a t Mather prepared t h e l i s t i n g with t h e i n t e n t i o n t o misrepresent t h e house. The t r i a l c o u r t concluded t h a t none of t h e r e a l e s t a t e p e r s o n s were proved t o be c u l p a b l e of such a w i l l f u l m i s r e p r e s e n t a t i o n o r s h o u l d b e h e l d t o answer f u r t h e r under t h e R e a l E s t a t e L i c e n s e Act. The r e c o r d viewed i n i t s e n t i r e t y s u p p o r t s t h i s c o n c l u s i o n by t h e D i s t r i c t C o u r t . The judgmen t of t h e D i s W e Concur: ?&A$' Chief J u s t i c e - - L/h-C(. Justices 3L-4L- -
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