Case ID: ad_138/html/0267-01.html
Source: Caselaw Access Project
Author: {"author": "Clarke, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Barnet Chenkin, Respondent, v. Max Lipman, Appellant.
    First Department,
    May 20, 1910.
    Principal and. agent—broker’s action for commissions — facts not justifying recovery.
    A real estate broker employed to effect an exchange of lands is not entitled to commissions when the principal refused to complete the transaction because the other party called upon him to execute a bond and mortgage in place of one which had been merged in a fee acquired by the other party subsequent to the original agreement to exchange.
    Appeal by the defendant, Max Lipman, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of' New York on the 3d day of November, 1909, upon the verdict of a jury, and also from an order entered in said clerk’s office on the 22d day of November, 1909, denying the defendant’s motion for a new trial made upon the minutes.
    
      Samson Lachma/n of counsel [Theodore Baumeister with him on the brief], Bachman & Goldsmith, attorneys, for the appellant.
    
      Jacob Mamheim, for the respondent.
   Clarke, J.:

This was an action by a real estate broker to recover for commissions upon an exchange of real property. The transaction was never completed. The broker claims- liis commissions upon the ground that.he had brought the parties together and that there had •been a complete meeting of the minds upon the exchange and that, therefore, his commissions were then earned.

For the purpose of a basis of exchange the defendant Lipman’s property was valued at $115,000 and Eoses’ property at- $65,000. There were outstanding mortgages- on both properties and it seems to be conceded that upon the exchange Eoses was to give Lipman $4,000 in cash, a mortgage of $4,000 upon certain other property owned by him, and a promissory note for $500, which was to be given to the broker in part payment of his commission, making in all $8,500.

Upon all the evidence, we reach the conclusion that .there was in existence upon Eoses’ property a first mortgage of $43,000; that he had owned a second mortgage made to him of $15,000, which had been reduced to $12,000, and that at the time of the negotiations had between himself, Lipman and the broker-they all supposed that second mortgage was still valid and in existence, and it, was taken into consideration upon these preliminary negotiations as such' existing and valid mortgage, so that when the property should be transferred to Lipman he would take it subject to these two mortgages. When the parties met at the office of the attorney for the purpose of preparing and executing the necessary papers, and after the preliminaries had been gone through with, the attorney for Mr. Eoses came in and informed the gathering' that by reason of the fact that Eoses had purchased this property the second mortgage thereby merged and no longer existed. Eoses appeared to be no less surprised than Lipman. Thereupon Lipman was urged to give his bond and mortgage for the amount supposed to have been covered by said second mortgage, which he positively refused to do, upon the' ground that he had not understood or agreed to become personally liable for any such sum and in any such way, and thereupon the negotiations ended. ■

Upon the trial the plaintiff and Eoses testified that Lipman had agreed to give a second bond and mortgage on Eoses’ property if the title was transferred to him, -but we are satisfied from the testimony of Lipman, Eozalsky and Goldsmith, as well as from the inherent probabilities of the case as presented, that the verdict based upon that contention'is against the weight of evidence; that the parties were dealing in their preliminary negotiations upon the basis_ of an existing mortgage, which none of them had the slightest idea had merged until' informed of that fact at the lawyer’s office, and that, therefore, the minds of the parties never met upon the existing state of facts, and that the plaintiff is not entitled to recover from Lipman the commissions prayed for.

It follows that the judgment and order appealed from should be reversed and a new trial ordered, with costs to the appellant to abide the event.

Ingraham, P. J., Laughlin, Scott and Miller, JJ., concurred.

Judgment and order .reversed and new trial ordered, with costs to appellant to abide event.