Opinion
No. 6274
Decided July 6, 1943.
Real estate brokers — Right to commission where no exclusive listing — Dependent upon performance by him in competition with others.
A real estate broker's right to a commission for the sale of real estate is dependent upon performance by him in competition with others who might be similarly engaged, where there is no exclusive listing or specific contract.
APPEAL: Court of Appeals for Hamilton county.
Mr. Raymond J. Kunkel, for appellee.
Messrs. Nieman, Fry, Schulze Dreidame, for appellant.
This is an appeal on questions of law from the overruling of defendant's motion for judgment notwithstanding the verdict, which was for plaintiff for the amount of a commission on a sale of real estate.
In December 1938, defendant informed plaintiff, together with other real estate brokers, by letter, that its industrial property located at 69th street, adjacent to the Big Four Railroad tracks, was for sale. This was admittedly a general and not an exclusive listing. The parties will be referred to as plaintiff and defendant, as they appeared in the court below.
On April 10, 1941, plaintiff took a prospect, one Nathan Brush, vice-president of Greif Bros. of Cleveland, Ohio, who later became the purchaser, to defendant's property, introducing him to one of the officers and showing the property which on that date Brush rejected because it was a two-story building and principally because there was no sidetrack available. On August 6, 1941, plaintiff again showed Cincinnati real estate to Brush and exhibited a plat of defendant's property, disclosing that a sidetrack had, in the interim, been extended to property adjacent to that of the defendant. Brush again rejected consideration of the property of defendant, without again viewing it, and stated they had decided to build.
One of defendant's officers early in August, incidental to being in downtown Cincinnati, stepped in the offices of Cleneay-Nourse Company and urged them to find a buyer for defendant's property.
Thereafter, early in August, one Steuewe, general superintendent of the purchaser, came to Cincinnati with general instructions to look for a site, including instructions to walk along the tracks in search of a site. Steuewe, not finding anything, started to telephone Cincinnati real estate brokers and contacted one Hoffmann of Cleneay-Nourse Company, who showed him the defendant's site, with the sidetrack adjacent and available for extension onto the defendant's property. Steuewe favored the site, and was to report that fact to his company. Hoffmann informed him he was leaving on vacation the following day and made tentative arrangements for a future meeting with Steuewe's superiors. Shortly thereafter, within four to ten days subsequent to August 6, 1941, the date of the last meeting between plaintiff and Brush, Brush again came to Cincinnati and, in the absence of Hoffmann, began direct negotiation with defendant for the purchase of the property, which culminated on August 26, 1941, in a tentative contract of purchase, conditioned on obtaining the consent of the state of Ohio in respect to the use of sidetrack over its property. During the negotiation, the parties contacted Hoffmann in regard to a reduction in commission, which was agreed upon.
Under the above facts, interpreted most favorably for the plaintiff, is the plaintiff entitled to a commission for the sale of such real estate?
There being neither an exclusive listing nor any contract, written or oral, setting forth the terms of representation, a case is presented here wherein the broker's right to recover a commission is dependent upon performance by him in competition with others who might be similarly engaged. His right to compensation is contingent upon the success of his efforts. Anything less or different from that will not suffice, and, in the absence of an agreement with the seller, his unsuccessful efforts to effect a sale entitle him to no commission. See Pfanz v. Humburg, 82 Ohio St. 1, 91 N.E. 863; Roush v. Loeffler, 18 C.C., 806, 6 C.D., 760; Hale v. Kumler, 85 F., 161; 8 American Jurisprudence, 1084, Section 168, and citations thereunder.
8 American Jurisprudence, 1087, Section 172, states the general proposition of law to be as follows:
"In the absence of a special contract, a broker must be the procuring cause of a sale or transaction in order to be entitled to commissions thereon. * * * When a broker is the procuring cause of a sale, is a question of considerable difficulty; in the main it is a question of fact for the jury, the decision in each case being dependent upon the particular facts and circumstances thereof." See citations thereunder. See, also, 6 Ohio Jurisprudence, 211, Section 39.
It is therefore apparent that the variety of cases involving original introduction of parties, acquaintance of broker and prospect, presence of broker at consummation of sale etc., are illustrative only of the general principles of the law as applicable to the facts and circumstances of the particular case and hence not determinative of the instant case. The general principles of law outlined above have been followed in the Ohio cases cited, under their particular facts. We must, therefore, apply those general principles to the facts of the instant case.
Plaintiff testified that Brush rejected the property on April 10, and again on August 6, and that his exhibition of the plat showing sidetrack on the property adjacent to the north was not sufficient to cause Brush to view the property again. He further testified that he did not again contact the purchaser until learning of negotiations between Brush and defendant, brought about by his competitor. Meanwhile, the visit of purchaser's general superintendent to the Cleneay-Nourse Company's office resulted in his being taken to view this particular real estate.
The premises then presented an appearance changed and different from that on April 10. The extension of the sidetrack to the premises adjacent on the north, constructed with a fill, rendered defendant's premises suitable, which fact was so reported to the purchaser by the general superintendent. Hoffmann being on vacation, Brush negotiated directly with defendant to discuss price, terms, possession and all collateral matters involved, such as the necessary consent of the state of Ohio for use of the track.
The petition alleges that plaintiff, on August 6, 1941, found a buyer ready, willing and able to buy defendant's property, and he so notified defendant.
The answer is in the form of a general denial and the burden of proving every material allegation in the petition rests upon the plaintiff.
No evidence of the purchaser's ability to buy on August 6, 1941, appears in the record. The fact that no one seemed to question that ability cannot be substituted for proof thereof, which proof the court deems necessary under the pleadings. C.O. Frick Co. v. Baetzel, 71 Ohio App. 301, 47 N.E.2d 1019. Nor is there any proof of purchaser's willingness to buy on that date, but, on the contrary, plaintiff's agent testified that Brush did not view the site again on that day, but rejected it, stating they were going to build. Plaintiff's agent further testified he never saw or contacted either the purchaser or defendant after that day, and no price, terms, or collateral conditions were discussed, let alone agreed upon. That the purchaser was ready to the point of anxiety to buy an industrial site somewhere in Cincinnati is clear. But an agreement by a real estate broker to procure a buyer implies not only one able to comply, but the completion of the task of getting the parties together on all the terms disclosed, to the point of entering into an enforceable agreement. This plaintiff did not do, and had not done so on August 6, 1941, and thereby left the field open to all competitors. The rule applicable here is stated in Wilson v. Mason, 158 Ill. 304, 311, 42 N.E. 134, 49 Am. St. Rep., 162.
Plaintiff argues to this court that there were collusion and fraud on the part of the purchaser and defendant, to avoid payment of a full commission to plaintiff. If such were present, there is no doubt that plaintiff would be entitled to a commission. Plaintiff relies principally upon the sequence of events and their timing as well as upon some measure of conflict or confusion in the testimony of defendant's officers with reference to who made disbursements. This court feels the record discloses no substantial evidence of collusion or fraud by reason of the above. The leading case of Vreeland v. Vetterlein, 33 N.J.L. 247, well states the law in a situation similar to the one we have here.
The court below was, therefore, in error in overruling defendant's motion for judgment non obstante veredicto and that judgment is hereby reversed and the cause remanded with instructions to enter judgment non obstante veredicto for defendant.
Judgment reversed and cause remanded.
MATTHEWS, J., concurs.
An examination of the record shows that on April 10, 1941, the agent for the purchaser refused the property because of lack of switching facilities. However, on August 6, 1941, the same representative of the purchaser was shown a plat indicating that switching facilities would then be easily available, a spur upon adjacent property having been installed.
The purchaser then contacted the seller, and defendant, through another real estate agent and by a different representative, a few days later concluded a sale.
Such a situation presents a factual issue for a jury as to whether the plaintiff or another agency was the procuring cause of the sale. The jury found for the plaintiff.
I think the order of the trial court directing a new trial cannot be disturbed in view of the law preventing appeal by the plaintiff from such order.