Case Name: Weatherhead v. Ettinger
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1908-03-24
Citations: 78 Ohio St. 104
Docket Number: No. 10471
Parties: Weatherhead v. Ettinger.
Judges: Price, Crew, Summers,- Spear and Davis JJ., concur.
Reporter: Ohio State Reports, New Service
Volume: 78
Pages: 104–108

Head Matter:
Weatherhead v. Ettinger.
Authority of real estate broker — To execute contract of sale for third parties.
A real estate broker is without authority to execute a contract of sale which shall be binding upon one who places real estate in his hands for sale unless such authority is specially conferred.
(No. 10471
Decided March 24, 1908.)
Error to the Circuit Court of Cuyahoga county.
Ettinger brought, suit against Weatherhead in the court of common pleas of Cuyahoga county' to recover damages resulting from his refusal to convey lot No. 9 in the village of Glenville in Cuyahoga county, alleging that he was bound to make such conveyance by the terms of a written contract executed in his behalf by one Lewis H. Wain, his agent, thereunto lawfully authorized. The defendant denied all the allegations of the petition. Upon the trial the plaintiff offered in evidence a written contract of the purport alleged signed, “Lewis H. Wain, agent for Albert J. Weatherhead,” and the instrument included an acknowledgment of the receipt of $50.00 on account of the purchase. For the authority of Wain to make a contract binding upon Weatherhead, plaintiff resorted to parol evidence which tended to show that Wain was a real estate broker in Cleveland, that he and Weatherhead frequently met at luncheon and upon one such occasion the latter expressed to the former a wish that he would sell this lot for the sum of $3,500.00. Upon a later occasion Wain reported that he was making progress toward finding a purchaser, to which Weatherhead answered, “Very well.” On the day following he executed the contract counted upon in the petition at the • price named, accepted $50.00 on the purchase and gave the receipt and contract referred to. Within a day or two he delivered to Weatherhead a copy of the contract but not the $50.00 paid on the purchase. Weather-head said he was not ready to convey and within a few days announced that he would not convey, and paid to Wain his commission as broker. In the court of common pleas there was a judgment in favor of the defendant on a verdict which the court had directed the jury to return in his favor. The circuit court being of the opinion that the evidence tended to show the state of facts upon which Ettinger was entitled to recover reversed the judgment of the court of common pleas and remanded the cause to that court for a new trial.
Messrs. Kline, Tolies & Golf, for plaintiff in error.
It is a well-established principle of the law governing the relations between a real estate broker and his client, that the authority of a real estate broker authorized or employed to sell land only extends to finding a purchaser who will be acceptable to the owner and will enter into a contract of purchase with him at the price fixed, and that he cannot bind his principal by signing a contract, unless the owner makes him more than a broker by giving him express authority to enter into such contract, in which event the agent would cease to be merely a broker, and become an attorney. Coleman v. Garrigues, 18 Barb., 60; Glentworth v. Luther, 21 Barb., 145; Morris v. Ruddy, 20 N. J. Eq., 236; O’Reilly v. Keim, 34 Atl., 1073; Duffy v. Hobson, 40 Cal., 240; Rutenberg v. Main, 47 Cal., 213; Campbell v. Galloway, 148 Ind., 440; Furst v. Tweed, 93 Ia., 303; Ballou v. Bergvendsen, 9 N. Dak., 286; Brandrup v. Britten, 92 N. W. Rep., 453; Halsey v. Monteiro, 92 Va., 581; Donnan v. Adams, 71 S. W. Rep., 580; McCullough v. Hitchcock, 42 Atl., 81; Carstens v. McReavy, 25 Pac., 471.
Mr. W. B. Neff and Mr. W. D. McTighe, for defendant in error.
Upon the subject of the power of an agent to bind his principal, in respect to sales of real estate, we desire to cite the following authorities: Smith v. Keeler, 151 Ill., 518; Kline v. Lindley, 30 Atl., 1063; Rosenbaum v. Belson, 2 L. R., Ch. Div. (1900), 267; Johnson v. Dodge, 17 Ill., 433; Vanada’s Heirs v. Hopkins’ Admrs., 19 Am. Dec., 92; Pringle v. Spaulding, 53 Barb., 17; Matherson v. Davis, 2 Caldwell (Tenn.), 443; 4 Am. & Eng. Ency. Law (2 ed.), 962.

Opinion:
Shauck, C. J.
The substantial question in the case is, did the evidence tend to show that Wain had authority to make a contract binding upon Weatherhead for the sale of the lot? The significant fact of which all parties to the transaction were aware was, that Wain was a real estate broker. His business was to find intending purchasers and bring them to those who had real estate for sale, and who had employed him for that purpose. It was in that capacity that he was approached by Weatherhead and that the conversations between them were carried on. The subject of executing a contract of sale on the owner's behalf with one who might desire to become a purchaser was not considered or mentioned in any of the conversations. The conversations were such only as would naturally occur between an owner of property desirous of selling it and a broker engaged in the business of finding purchasers. If it should be conceded that by custom a real estate broker might, without special and express authority, execute a contract of this character binding upon the qwner who placed his land in his hands for sale, the attempt to show that such a custom existed failed utterly in the present case. It is in accordance with common understanding that one soliciting the services of a real estate broker, when nothing more appears, reserves to himself the power to conclude the sale. A reference to the cases cited in the reporter's abstract of the briefs will show that the cases are generally in accordance with this view. It is to be observed that the question is not affected at all by any of the cases which determine the right of the broker to compensation. That obligation Weatherhead has conceded in the present case, and he has discharged it. While some support to the opposite view may be derived from two of the cases cited in the brief of the defendant in error, they must be regarded as in conflict, not .only with the current of authority upon the subject, but with the common understanding of business men. There was, therefore, no original authority in Wain to execute the contract.
But it is said that if there was not original authority given to Wain to execute the contract, the contract was subsequently ratified by Weather-head. The case presents no element of ratification. The money delivered to Wain on account of the proposed purchase was not accepted by Weather-head, if indeed he was informed of the fact that it had been paid to Wain. Weatherhead did nothing but retain the copy of the contract tendered to him for brief and reasonable consideration, and then exercised his right to decline to execute it. The position of Ettinger was in no way changed in consequence of anything that was done or omitted by Weatherhead.
Judgment of the circuit court reversed and that of the common pleas affirmed.
Price, Crew, Summers,- Spear and Davis JJ., concur.