The sole issue presented on this appeal is whether the trial court had jurisdiction over the
It is also recognized that:
"(i) a claim arising out of a bargaining arrangement made with the defendant by or on behalf of the plaintiff; (ii) a promise or other act of the defendant, made or performed anywhere, which evidences the bargaining arrangement sued upon; and (iii) a showing that the arrangement itself involves or contemplates some substantial connection with the state. . . No other contacts than those stated are required; an isolated bargaining arrangement giving rise to the action brought is a sufficient basis for jurisdiction. . . ."
Respondent Pavalon was the only person who testified at the hearing on jurisdiction, and the record discloses the following: Seymour Fishman telephoned from Chicago on December 17, 1961, to advise respondent that he was making a "private placement" of Sulray debentures (and the concomitant warrants) to close friends and inquired whether respondent was interested in purchasing a $50,000 parcel. Fishman told respondent about the company, explained that it was a wonderful opportunity, indicated that certain other notables were participating, and offered to send as prospectus. Respondent had been doing business with Fishman, who was a partner in the Divine & Fishman brokerage firm, for a year prior to this time. Respondent expressed interest and received a detailed prospectus on Divine & Fishman, Inc., stationery. Respondent made arrangements for raising
"The Company represents and warrants that neither the Company nor any agent on its behalf has sold, offered or attempted to dispose of the Subordinated Notes and Warrants . . . . The Company or any agent on its behalf shall not sell, offer or attempt to dispose of the Subordinated Notes and Warrants . . . ." (Emphasis added.)
Respondent knew that Fishman had made "private placements" for other companies. Divine & Fishman received a finder's fee of $40,000 from Sulray for handling the entire debenture sale, of which the present transaction was just a part.
Respondent appears to concede—and it is apparent from considering the three required elements discussed above in light of the sparse evidence adduced at the trial—that Sulray cannot be reached directly under sec. 262.05 (5) (e), Stats. This would be because (1) no one from Sulray did any bargaining, soliciting, or negotiating with respondent, (2) Sulray did not make any of the promises or representations which gave rise to this action for misrepresentation, and (3) there was no affirmative showing that the loan arrangement contemplated
The general rule, in Wisconsin as well as elsewhere, is that brokers, whether employed for a single transaction or a series of transactions, are agents even though their physical activities resemble those of independent contractors.
". . . the place of work, the time of employment, the method of payment the right of summary discharge of employees, the nature of the business or occupation, which party furnishes the instrumentalities or tools, and the intent of the parties to the contract."
Furthermore, it is undoubtedly true that aside from respondent's own impressions of the relationship existing between appellant and Divine & Fishman and a showing that Divine & Fishman was a brokerage business by nature, no evidence bearing on these criteria was introduced at the hearing. However, what appellant overlooks is that it is necessary to introduce proof with respect to these tests only in a situation where it is not already established by law that a particular relationship is that of agent and principal. For example, a salesman may or may not be an agent.
The controversy may now be considered on the merits, jurisdiction of the subject matter having been settled by the first Pavalon Case. The fact that Divine & Fishman was held by the trial court to be the agent for the limited purpose of acquiring jurisdiction over Sulray is not res judicata on the merits of whether the defendant brokerage corporation or Fishman, individually, were acting on behalf of Sulray, or within the scope of their authority, in inducing and making the sale to plaintiff.
By the Court.—Order affirmed and cause remanded for further proceedings not inconsistent with this opinion.
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"(3) Local Act or Omission. In any action claiming injury to person or property within or without this state arising out of an act or omission within this state by the defendant.
"(4) Local Injury; Foreign Act. In any action claiming injury to person or property within this state arising out of an act or omission outside this state by the defendant, provided in addition that at the time of the injury either:
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"(5) Local Services, Goods or Contracts. In any action which:
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"(e) Relates to goods, documents of title, or other things of value actually received by the plaintiff in this state from the defendant without regard to where delivery to carrier occurred."