Opinion
45634.
ARGUED SEPTEMBER 17, 1970.
DECIDED JANUARY 19, 1971. REHEARING DENIED FEBRUARY 19, 1971.
Action for broker's commission. DeKalb State Court. Before Judge Mitchell.
Arnall, Golden Gregory, H. Fred Gober, for appellants.
Curtis R. Richardson, Davis Stringer, Robert H. Stringer, Smith, Cohen, Ringel, Kohler, Martin Lowe, Malcolm H. Ringel, for appellees.
In the absence of proving that the plaintiffs were the procuring or efficient cause of the sale, there can be no recovery upon either the alleged breach of a real estate commission contract or an alleged conspiracy to defraud the plaintiffs of the commission.
ARGUED SEPTEMBER 17, 1970 — DECIDED JANUARY 19, 1971 — REHEARING DENIED FEBRUARY 19, 1971.
Plaintiffs in a two-count suit for a real estate sales commission (conspiracy to defraud and contract) appeal from a directed verdict for all defendants on both counts.
A woman whose husband was being transferred to Atlanta came to town to look for a house. (We shall call them the Buyers, to avoid a confusion in names with plaintiffs.) She called old friends for their advice on neighborhoods, etc., and used several different real estate companies in her search. Two of plaintiffs' agents showed her a number of houses. She had told them $40,000 was her absolutely top price, but she was taken to a house whose asking price was around $44,000. This was a new, unoccupied house owned by defendant Builder. Mrs. Buyer liked it and, with the encouragement of the plaintiffs' agents, signed an offer of $38,000. This house was not listed exclusively with plaintiff realty company, nor was there any written listing agreement. Agent Fields had simply telephoned Builder, asked if they might show the house and he had agreed. Builder is himself a licensed real estate broker (who sells most of his houses directly) and it may be inferred that he understood if an agent procured a buyer, he would owe plaintiffs a commission. When presented with Mrs. Buyer's offer of $38,000 by plaintiffs' agents, he rejected it as too low and refused to make a counteroffer. Mrs. Buyer made no further offer and said she put the property out of her mind. Mrs. Buyer and Builder never met during these negotiations but there is slight evidence from which it might be inferred they knew each other's names.
Later the same week, Mr. Buyer came to Atlanta for a day to look at the houses his wife considered good possibilities. Plaintiffs' agent Green took them to several places, including Builder's house, but it was locked. Mr. Buyer said he didn't like it from the outside anyhow and was glad the offer had not been accepted. The Buyers and Agent parted with a vague promise to get in touch later.
During her stay in Atlanta, Mrs. Buyer had been in touch with a friend, Mrs. Klee, who had suggested that the Buyers should consider building a house and that she could put them in touch with the man who had built her own house. Mrs. Klee arranged this meeting at her home for the evening Mr. Buyer was in town. Her builder was the defendant here, of course. This was the first meeting of the Buyers and Builder and they all testified it was the first time they were aware of each other's identities. They first discussed the possibilities of building a house, but when Mr. Buyer realized the length of time this would require, he rejected the idea, as his transfer was imminent. Builder then told them he had several completed houses they might consider, one of which was right down the street and could be inspected immediately. When they all arrived, Mrs. Buyer realized this was the house upon which she had made an offer and mentioned that fact to Builder. After viewing the interior, Mr. Buyer decided he really did like the house and began negotiations with Builder. They agreed upon $40,000 and Builder produced one of his standard-form sales contracts which both parties signed on the spot. The contract called for the payment of no real estate commission.
The next week, plaintiffs' agent learned that the house had been sold directly and called Builder to demand their commission. Upon his refusal to pay, they brought this suit, alleging that the Buyers and Builder had conspired to defraud plaintiffs of their commission. They sought actual damages in the amount of 6% of the selling price plus punitive damages and attorney's fees.
In presenting their case, plaintiffs called not only their own agents but all the defendants on cross examination. At the close of plaintiffs' case, defendants moved for a directed verdict which the court granted. Plaintiffs then asked for permission to amend and add another count seeking recovery in contract against Builder alone. The court granted permission and invited plaintiffs to proceed. Plaintiffs replied they had nothing further. Defendant Builder then made a motion for a directed verdict on the alleged contract count which the court granted.
The briefs of all parties discuss at length the badges of fraud, elements of a conspiracy, election of remedies, etc. We believe the determining factor lies elsewhere. In a similar action, this court said, "it is manifest throughout all of the cases that the gist of an action by a broker to recover commissions is the showing that the plaintiff-broker was the procuring or efficient cause of the sale. See annotations Code § 4-213 and 12 CJS 207, Brokers, § 91.... In absence of alleging those essentials, there can be no contract breached in the first instance nor a conspiracy coupled with a wrong done in the second." Woodall v. McEachern, 113 Ga. App. 213, 221 ( 147 S.E.2d 659).
While the Woodall case was determined on demurrer, the same principles apply if the word "proving" is substituted for "alleging." See also Morgan v. Ezzard, 121 Ga. App. 208 ( 173 S.E.2d 423).
Plaintiffs here failed to make a prima facie case that they were the procuring or efficient cause of the sale. On the contrary, the evidence shows that any transaction involving plaintiffs had been abandoned by all defendants, and that if anyone was the procuring cause of the sale as it finally transpired, it was Mrs. Klee. Plaintiffs made no showing which contradicted this evidence.
Judgment affirmed. Bell, C. J., Jordan, P. J., Eberhardt, Pannell, Deen, Quillian and Whitman, JJ., concur. Evans, J., dissents.
I dissent from the judgment of affirmance and from the opinion on which such judgment is based.
In substance, the evidence showed: Plaintiffs were engaged in the real estate business. One of the defendants was the owner of property which he wished to sell, and the other two defendants (husband and wife) were prospective purchasers of said property. The real estate firm and the owner had agreed that plaintiffs might show and sell the property on certain terms and for a commission. The real estate firm showed the property to said prospective purchasers (husband and wife) who did not buy the property then and there, but just three days later, and in fact, only a few hours after they had again looked at the dwelling with the realty firm's agent, a written agreement with the owner for the purchase of said property was consummated by the wife, and thus left the real estate firm out in the cold.
Plaintiffs filed suit against the seller and the two purchasers, alleging that they had conspired to defraud plaintiffs out of a commission on the sale. The suit proceeded in two counts, one being for fraud and deceit, and the other being on an oral contract. At the trial, after hearing evidence, the lower court directed a verdict against the plaintiffs, and the appeal is from this judgment.
I readily concede that there was no direct evidence in the case which positively and absolutely shows fraud, but fraud, "being in itself subtle, slight circumstances may be sufficient to carry conviction of its existence." Code § 37-706; Holbert v. Allred, 24 Ga. App. 727 (2) ( 102 S.E. 192). "Fraud may be consummated by signs or tricks, or through agents employed to deceive, or by any other unfair way used to cheat another." Code § 37-705. Further: "Fraud may be actual or constructive. Actual fraud consists in any kind of artifice by which another is deceived. Constructive fraud consists in any act of omission or commission, contrary to legal or equitable duty, trust, or confidence justly reposed, which is contrary to good conscience and operates to the injury of another." Code § 37-702.
The conduct of the defendants in this matter is most important, since a conspiracy may be inferred therefrom. The seller, who was also a real estate broker, had been trying to sell the dwelling through multiple listing services; was willing for the plaintiffs to show it, and agreed to pay them a commission if it was sold by the plaintiffs. The house was shown by the plaintiffs to the purchasers. The defendant seller had knowledge the defendant buyers were shown the house and had refused to sell it to them, by and through the plaintiffs, for $38,000. He would sell it for $40,000. The plaintiffs had shown the house to the purchasers on the very date the sale was negotiated directly by the purchasers with the seller; and had also shown it to the wife three days before. The defendant buyers did not authorize a contract for $40,000; but on the same date they last examined the house, entered into a direct contract with the seller for $40,000 in complete disregard of plaintiffs. And on cross examination, the wife admitted she had requested her mother not to say anything to anyone about the purchase until the loan went through.
Only a jury in this case had the right to determine what the scienter or intent of the defendants was respecting their conduct in this matter. In the case of Cole v. State, 118 Ga. App. 228, 229 ( 163 S.E.2d 250), it is held: "Intent being a state of mind, it must, unless admitted, be inferred by the jury from the acts of a person and the circumstances surrounding his actions." (Emphasis supplied.) In Grainger v. Jackson, 122 Ga. App. 123, 127 ( 176 S.E.2d 279), it is held: "In an action for deceit, there are traditional elements which must be proved, of course, and a material misrepresentation or concealment is one of them, as is knowledge of the falsehood or reckless disregard of the true facts. Code § 105-302. Equally basic however, is the proposition that fraud is `in itself subtle,' Code § 37-706, and that ` circumstances apparently trivial or almost inconclusive, if separately considered, may by their number and joint operation ... be sufficient to constitute conclusive proof.' Eberhardt v. Bennett, 163 Ga. 796, 802 ( 137 S.E. 64)." (Emphasis supplied.)
Further, a conspiracy may be proven by circumstances alone, and it is not necessary to prove that these alleged conspirators ever met together or entered into an agreement to accomplish the purpose of cheating the plaintiffs out of the commission, but this may be inferred from the acts, declarations and conduct of these defendants.
"`To show conspiracy it is not necessary to prove that the parties met together or entered into any specific or formal agreement, or that by words or writing they formulated their unlawful objects. Proof that the two or more persons, either positively or tacitly, come to an understanding that they will accomplish an unlawful design, or a lawful design unlawfully, is sufficient.' Woodruff v. Hughes, 2 Ga. App. 361 (3) ( 58 S.E. 551). See also Huckaby v. Griffin Hosiery Mills, 205 Ga. 88, 91 ( 52 S.E.2d 585), wherein it is said: `A conspiracy or common intent may be shown to have existed between the parties by proof of facts and conduct ( Davis v. State, 114 Ga. 104 ( 39 S.E. 906); Odum v. State, 183 Ga. 854 ( 190 S.E. 25); and it may be shown by circumstantial or direct evidence. McLeroy v. State, 125 Ga. 240 (2) ( 54 S.E. 125). "The law recognizes the intrinsic difficulty of proving a conspiracy... The conspiracy may sometimes be inferred from the nature of the acts done, the relation of the parties, the interests of the alleged conspirators, and other circumstances." Woodruff v. Hughes, 2 Ga. App. 361 ( 58 S.E. 551); Horton v. Johnson, 192 Ga. 338, 346 ( 15 S.E.2d 605).'" Walden v. State, 121 Ga. App. 142, 144 ( 173 S.E.2d 110).
The seller denied that he authorized the realty firm to show the house further, and all defendants denied any conspiracy or intent to defraud the plaintiffs, but this conflict in the evidence created issues for the jury to decide, and I therefore would reverse the judgment based on the directed verdict by the court.