Case Name: FRANK F. JONES v. PALACE REALTY COMPANY
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1946-05-01
Citations: 226 N.C. 303
Docket Number: 
Parties: FRANK F. JONES v. PALACE REALTY COMPANY.
Judges: 
Reporter: North Carolina Reports
Volume: 226
Pages: 303–307

Head Matter:
FRANK F. JONES v. PALACE REALTY COMPANY.
(Filed 1 May, 1946.)
1. Contracts § 8—
If there be no dispute in respect of the terms of a contract, and they are plain and unambiguous, there is no room for construction. The contract is to be interpreted as written.
2. Same—
If the words employed in a contract are capable of more than one meaning, the meaning to be given is that which it is apparent the parties intended them to have, and the practical interpretation of the agreement by the parties ante litem motam will control.
3. Same—
An ambiguity in a written contract is to be inclined against the party who prepared the writing.
4. Contracts §§ 10, lib—
The general rule is to the effect that the rise of such words as “when,-” “after,” “as soon as,” and the like, gives clear indication that a promise is not to be performed except upon the happening of a stated event, and it can make no difference whether the event be called a contingency or the time of performance, since in neither case may performance be exacted unless or until the event transpires.
5. Brokers § 11 — Agreement to pay commissions “when the deal is closed . . . out of the sale price” is enforceable only upon consummation of sale.
This action was instituted to recover brokerage commissions based upon an agreement set forth in a letter written by plaintiff broker which stated that the commissions were to be paid “when the deal is closed up . . . out of the sale price.” The evidence tended to show that plaintiff procured a purchaser who contracted to buy at a price agreed, but that the sale was not consummated because the purchaser thereafter became financially unable to comply. Held,: The contract is to be interpreted as written, and under its terms the broker is not entitled to recover commissions upon the facts and judgment of nonsuit was proper, there being no evidence to support plaintiff’s contention that the failure to close the deal was due to defendant’s own default or his contention of waiver.
Appeal by plaintiff from Bobbitt, J., at November Extra Term, 1945, of MeCKLENBTJRG.
Civil action, by broker to recover commission for procuring purchaser ready, able and willing to buy land on terms authorized.
The plaintiff is a licensed real estate broker iñ the City of Charlotte. In August, 1944, he was given the exclusive right, for thirty days, to sell the old Charlotte Sanatorium property at a price satisfactory to the owner — commission to be paid “out of the proceeds.” On 1 September, 1944, the plaintiff prepared a letter for signature by the Palace Realty Company, addressed to Mr. U. A. Zimmerman, in which the owner agreed to sell to the addressee the Sanatorium property at a price of $100,000— “Deed to be made up at once, and the transaction to be finally closed up soon as your attorney investigates title to the property.”
This letter concludes with the statement: “When the deal is closed up we will pay Frank F. Jones his commission of 5% . . . out of the sale price of the property.”
Following the signature of the Palace Realty Company by A. M. Whisnant, President, appears the acceptance in writing by U. A. Zimmerman, and also the signature of Frank F. Jones, agent for Palace Realty Company.
Negotiations ensued looking to a consummation of the sale, but on 18 October, 1944, large Federal tax liens were levied against U. A. Zimmerman in consequence of which he “became unable to comply with his contract.” The deal, therefore, was never “closed up” and the purchase price never paid.
In his testimony the plaintiff says : “The Palace Realty Company has never given me a commission for the sale of this property. I waited for weeks and weeks for him (Dr. Whisnant) to close it up. I didn’t want to make any demand on him for my commission until it was closed up.”
From judgment of nonsuit entered at the close of ■ all the evidence, the plaintiff appeals, assigning errors.
Taliaferro & Clarkson and Joseph W. Grier, Jr., for plaintiff, appellant.
Robinson & Jones for defendant, appellee.

Opinion:
Stacy, C. J.
The question for decision is whether the promise to pay the plaintiff's commission, as set out in the letter of 1 September, 1944, from Palace Eealty Company to TJ. A. Zimmerman, binds the defendant absolutely or conditionally. The trial court interpreted the stipulation as a promise to pay plaintiff's commission "when"- — and only when— "the deal is closed up," and then "out of the sale price of the property." The view seems to accord with the terms of the agreement as prepared by the plaintiff. Anno. 20 A. L. R., 289.
It will be noted the judgment of nonsuit is grounded on the special contract, prepared by plaintiff, where the sale failed because of the inability of the purchaser procured by the broker to complete it. Watson v. Odell, 58 Utah, 276, 198 Pac., 772, 20 A. L. R., 280. The case is not like the usual broker's action where a responsible purchaser is procured by his efforts under a general contract, express or implied. White v. Pleasants, 225 N. C., 760; Lindsey v. Speight, 224 N. C., 453, 31 S. E. (2d), 371; Anno. 73 A. L. R., 926. Nor is it an instance where the sale failed of consummation because of some default on the part of the owner. Colvin v. Post Mtg. & Land Co., 225 N. Y., 510, 122 N. E., 454.
The heart of a contract is the intention of the parties. Bank v. Page, 206 N. C., 18, 173 S. E., 312; 12 Am. Jur., 760. This intention is to be gathered from the entire instrument, viewing it from its four corners. Krites v. Plott, 222 N. C., 679, 24 S. E. (2d), 531; Simmons v. Groom, 167 N. C., 271, 83 S. E., 471; Whitley v. Arenson, 219 N. C., 121, 12 S. E. (2d), 906. If there be no dispute in respect of the terms of the contract, and they are plain and unambiguous, there is no room for construction. The contract is to be interpreted as written. Potato Co. v. Jenette, 172 N. C., 1, 89 S. E., 791. "If the words employed are capable of more than one meaning, the meaning to be given is that which it is apparent the parties intended them to have." King v. Davis, 190 N. C., 737, 130 S. E., 707. It is also a rule of construction that an ambiguity in a written contract is to be inclined against the party who prepared the writing. Wilkie v. Ins. Co., 146 N. C., 513, 60 S. E., 427. Then, too, the ante litem moiam practical interpretation of the parties is a safe guide in the interpretation of contracts. Cole v. Fibre Co., 200 N. C., 484, 157 S. E., 857. Tbe present case stands or falls on tbe proper construction of tbe written agreement between tbe parties. Jones v. Casstevens, 222 N. C., 411, 23 S. E. (2d), 303.
Tbe plaintiff takes tbe position that when be procured a purchaser ready, able and willing to buy tbe property on terms satisfactory to tbe owner and a binding contract of sale was entered into, "bis commission" was thereupon earned, and tbe stipulation that it should be paid "when tbe deal is closed up" has reference to tbe time of payment rather than to tbe happening of an event upon which its payment would depend. Crowell v. Parker, 171 N. C., 392, 88 S. E., 497; S. c., 175 N. C., 717, 95 S. E., 188; Harrison v. Brown, 222 N. C., 610, 27 S. E. (2d), 470; Anno. 51 A. L. R., 1390. To this tbe defendant replies, "such might have been tbe contract, but it is not so nominated in tbe special agreement."
It can make no difference whether tbe event be called a contingency or tbe time of performance. Certainly, under either construction, tbe result would be tbe same; since, if tbe event does not befall, or a time coincident with tbe happening of tbe event does not arrive, in neither case may performance be exacted. Nor will it do to say that a promise to pay "when tbe deal is closed up" is a promise to pay when it ought to be closed up according to tbe terms of tbe contract. Such is not the meaning of tbe words used. It is tbe event itself, and not tbe date of its expected or contemplated happening, that makes tbe promise to pay performable. Amies v. Wesnofske, 255 N. Y., 156, 174 N. E., 436, 73 A. L. R., 918.
Tbe weight of authority is to tbe effect that tbe use of such words as "when," "after," "as soon as," and tbe like, gives clear indication that a promise is not to be performed except upon tbe happening of a stated event. 12 Am. Jur., 849. It has been held that promises to pay commissions to brokers, for tbe procurement of sales of real estate, are conditional when expressed to be performable "on tbe day of passing title" (Leschziner v. Bouman, 83 N. J. L., 743, 85 Atl., 205); "when tbe sale is completed" (Sams v. Olympia Holding Co., 153 Wash., 254, 279 P., 575); "upon delivery of tbe deed and payment of tbe consideration" (Tarbell v. Bomes, 48 R. I., 86, 135 A., 604, 51 A. L. R., 1386); "at settlement" of total consideration (Simon v. Myers, 284 Pa., 3, 130 A., 256); "when tbe sale is consummated" (Alison v. Chapman, 36 Cal. App., 759, 173 P., 389); "at tbe date of passing title" (Baum v. Goldblatt, 81 Pa. Supr. Ct., 233); "at tbe time of tbe consummation" of tbe sale (Morse v. Conley, 83 N. J. L., 416, 85 A., 196); "out of tbe first money received" from tbe sale (Lindley v. Fay, 119 Cal., 239, 51 P., 333); "out of tbe proceeds of said deal" (Kiam v. Turner, 21 Tex. Civ. App., 417, 52 S. W., 1043); "2% per cent, of tbe amount you receive" from tbe sale (Lee v. Greenwood Agency Co., 123 Miss., 823, 86 So., 449); "out of tbe payments as made" (Murray v. Rickard, 103 Va., 132, 48 S. E., 871); and in tbe case at bar tbe broker's commission is payable "when tbe deal is closed up," and tben "out of tbe sale price of the property."
"A commission agent employed to negotiate a sale upon tbe terms that be is to be paid a commission on tbe amount of purchase money, or on tbe happening of a certain event, will not be entitled to any commissions until tbe purchase money has been received or tbe event has happened, unless there has been fraudulent delay or willful neglect on tbe part of tbe employer." 2 Addison on Contracts, sec. 925.
It is alleged in tbe instant complaint that tbe failure to close tbe deal was due to tbe defendant's own default. However, tbe evidence adduced on tbe bearing is insufficient to support tbe allegation. Tbe question of waiver was also advanced by tbe plaintiff, but this, too, is unsupported by tbe record. Hence, tested by tbe weight of authority and our own decisions, it would seem that we have here a promise to pay plaintiff's commission upon a condition which has not been fulfilled and "out of tbe sale price of tbe property" which has not been received because of tbe inability of tbe purchaser to comply with bis contract. Tbe result is an affirmance of tbe judgment of nonsuit.
Affirmed.