Case Name: Jesse C. Bennett, Pl'ff. v. John J. Egan et al., Def'ts
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1893-05-01
Citations: 52 N.Y. St. Rep. 437
Docket Number: 
Parties: Jesse C. Bennett, Pl'ff. v. John J. Egan et al., Def'ts.
Judges: 
Reporter: New York State Reporter
Volume: 52
Pages: 437–441

Head Matter:
Jesse C. Bennett, Pl'ff. v. John J. Egan et al., Def'ts.
(New York Superior Court, General Term,
Filed May 1, 1893.)
1. Brokers—Commissions.
To entitle a broker to commissions, his services must result in a complete meeting of the minds of both the vendor and vendee.
3. Same.
PlaintifE was employed by defendants to sell their real estate, and procured a purchaser. At a meeting in his office he procured both defendants and said purchaser to sign an instrument which he drew, reciting the payment of fifty dollars to bind contract to be executed elsewhere and on payment of a certain sum. and the balance according to contract, part cash and the rest by a purchase money mortgage. Thereafter the defendants and the purchaser disagreed as to the t rms of the mortgage, the latter having been assured by p’aintiff without authority that it should run five years, and the negotiations terminated and were never resumed. Held, that the instrument so executed was not a contract which could he enforced, but a mere option good until the time for executing a contract, and that plaintiff never procured a complete meeting of the minds of the vendors and purchaser, and hence did not earn his commission.
Exceptions taken by the defendants ordered to be heard at general term in the first instance.
Thomas E. Rochfort, for pl'ff; Edgar Whitlock, for def'ts.

Opinion:
Freedman, J.
At the close of the whole case both parties moved for the direction of a verdict Neither requested that any question of fact be submitted to the jury. On the argument before us the counsel for the defendants conceded that the question to be determined is one of law. The substantial question, therefore, is whether upon the evidence the verdict should have been directed, as matter of law, in favor of the defendants instead of the plaintiff.
The action is brought by the plaintiff, a real estate broker, to recover the amount of commissions alleged "to be due to him from the defendants for services rendered to the defendants and at their request. There is no dispute about the employment of the plaintiff as a broker, and it is conceded that he rendered some services, and that, if entitled to recover at all, he is entitled to a commission of one per cent upon the purchase price. But thte defendants deny that the plaintiff did all he was bound to do and that he brought about an enforceable contract.
In employing a broker to sell real estate the vendor's liability for the broker's services depends upon his contract with the broker, which may be express or implied. In the case of an express and special contract the broker, in order to recover his commission from the vendor, must establish that he performed the special contract in every particular by producing to the vendor a party able and ready and willing to take the property upon the precise terms prescribed by the vendor.
In the absence of an express contract the implication usually is that the broker becomes entitled to the usual commissions whenever he brings to the vendor a party who is able and ready and willing to take the property upon the terms then named by the vendor, although the particulars may be arranged between vendor and vendee directly. But in every case the broker's services must result in a complete meeting of the minds of both vendor and vendee, for the duty he undertakes, the obligation he assumes as a condition of his right to demand commissions, is to bring the vendor and vendee to an agreement. Sibbald v. Bethlehem Iron Co., 83 N. Y., 381; Alden v. Earle, 121 N. Y., 688; 31 St. Rep., 375; affirming 56 N. Y. Superior Ct., 366; 23 St. Rep., 961. Whenever the broker's services have resulted in such a complete, meeting of the minds of both vendor and vendee, he is, in the absence of an express stipulation to the contrary, entitled to the compensation agreed upon or to the usual commission, although the vendor changes his mind and refuses to enter into a written contract. In such a case the vendor cannot by his own wrongful act deprive the broker of his commission.
On the other hand, as long as the vendor insists upon something which he has a right to insist upon as a condition of sale, and to which the vendee refuses to assent, in consequence of which disagreement the vendee refuses to enter into an enforceable contract, it cannot be held that the broker procured a complete meeting of the minds of both vendor and vendee. This proposition is self evident. In Platt v. Kohler, 65 Hun, 557; 49 St. Rep., 12, it was expressly held that where the vendor stands ready to perform and to enter into a contract on conditions he has authorized, the broker's right to commissions depends upon his procuring a person ready and willing to contract in such a way as to be legally bound to perform. To the same effect is Crombie v. Waldo, 50 St. Rep., 180.
Now the case at bar is not one where the broker, having been given definite terms on which to sell, produces a buyer able and willing and ready to comply with such terms. It is a case of implied contract. Before the defendants came to plaintiff's office on the day the paper was signed, which will be presently considered, the defendants had not agreed to take $34,650. They only agreed to take that sum after much talking and bargaining had taken place, whereupon the plaintiff prepared the following paper upon which he rests his right to recover, and which he induced the vendors and the vendee to sign, viz. :
" New York, November 10, 1890.
" We, J. J. Egan and D. Hallecy, do hereby agree to sell the five-story house, situated on the southwest corner of West End avenue and Seventy-eighth street, to Henry Rothmann: and I, Henry Rothmann, hereby do agree to purchase the above described premises at the purchase price of ($34,650) thirty-four thousand six hundred and fifty dollars, and pay in hand to J. J. Egan and D. Hallecy fifty dollars, the receipt of which is hereby acknowledged to bind contract which is to be executed at the office of E. Whitlock, 291 Broadway, New York city, and upon payment of $1,000, and the balance according to contract, as follows: $8,650 in cash, and $25,000 in purchase money mortgage, property is to be delivered free and clear of all claim or claims up to the day taking title, except street assessments.
"On contract $1,000
" For deed... 8,650
"Mortgage..., 25,000
$34,650
" (Signed) J. J. Egan,
" Daniel Hallecy,
" Henry Rothmann."
The said Rothmann, as vendee, and the defendants, as vendors, had no personal understanding with each other in the matter, except as expressed in the said written instrument, the bargaining having been carried on through the plaintiff as broker. Subse quently Eothmann and the defendant, Egan, met at the place specified in the written instrument to enter into a formal contract, and were unable to agree upon the terms of the mortgage, and thereupon Eothmann refused to enter into any further contract, and the negotiations were broken off, and were never resumed.
The question, therefore, arises whether the said written instrument of itself was or was not an enforceable contract for the sale and purchase of the real estate therein referred to. After much research and reflection I have come to the conclusion that it was not a contract upon which the vendors could rest an action to compel the vendee to perform, but was merely, at least so far as the vendee was concerned, an agreement that he would thereafter execute a contract to purchase or forfeit the fifty dollars paid as liquidated damages.
In other words, the vendors gave to the vendee an option, good until the meeting at which the contract was to be executed, for which option the vendee paid fifty dollars. At most it was a contract for a contract, for the whole instrument must be read together, in which case the opening words relating to buying and selling are clearly qualified by "pay in hand fifty dollars to bind contract which is to be executed," and because the fifty dollars paid formed no part of the consideration of $34,650 to be paid for the property, for the whole of that sum was otherwise provided for. In - this respect the case is just the reverse of Simonson v. Kissick, 4 Daly, 143, in which seventy-five dollars had been paid on account of, and as part of, the purchase price.
So the paper itself, without the aid of other evidence, does not constitute a contract enforceable against the vendee, because it is too indefinite in terms. Passing over such matters as character of deed and time of closing, and considering only the question of the $25,000 mortgage, which was to be a purchase money mortgage, a question at once arises as to its terms. Should it ruii one, two, three, or how many years? What rate of interest should it bear, and how payable, quarterly, semi-annually, annually, or at the end of the term ? Should it contain clauses making principal payable on default in interest or taxes ? But why particularize further? Until the parties had agreed on these details, of great importance to both sides, it would be impossible to draw such mortgage. No court would have jurisdiction to determine it for them, for it is idle to contend that a mortgage payable on demand could be substituted as matter of law. The cases to which the learned counsel for the plaintiff has called attention are clearly distinguishable. Westervelt v. Matheson, Hoffman Ch., 37, and Bostwick v. Beach, 103 N. Y., 414; 3 St. Rep., 659, were cases in which the contract wrns sufficiently definite against the vendor, and the vendee elected to take title and to have incumbrances removed out of the purchase money. Dieter v. Fallon, 34 St. Rep., 680, turned upon its own facts, which were complicated, and it was held that it sufficiently appeared what mortgages were as matter of fact intended by the parties.
In Beebe v. Ranger, 35 N. Y. Supr. Ct., 452, the broker had fully performed all he was employed to accomplish, and the sale fell through because the vendor wrongfully persisted in inserting in the contract a forfeiture clause to which the vendee declined to accede. It was in view of the fact that the sale fell through solely in consequence of the vendor's fault, that it was held that the fact that the interest, insurance clause and the time for the payment of the mortgage had not been arranged before the day the contract -was to be signed did not deprive the broker of his commission. No case has, therefore, been cited which is in conflict with the views expressed by me.
The defendants' case becomes still stronger when the circumstances surrounding the execution of the written instrument and the reasons for the refusal of the vendee to execute a further contract are considered.
Aside from the claim of the defendants that they told plaintiff that they would sign no contract outside of Whitlock's office, which is denied by the plaintiff, the preponderance of evidence given at the trial is to the effect: 1. That the plaintiff, who drew the written instrument himself in order to secure, if possible, his commissions, procured the signature of the vendee to it upon the representation that the mortgage of $25,000 was to run for five years, although neither of the defendants had authorized him so to do or had, ever told him so, and although there was already on the property a mortgage for that amount having about a year to run;
2. That although nothing whatever was said by either of the parties concerning the terms of the mortgage, the plaintiff made the written instrument provide for a purchase money mortgage, a provision which the defendants did not intend to make and which the vendee did not understand, and
3. That the vendee at Whitlock's office refused to enter into a formal contract for the sole reason that the mortgage could not be made to run for five years as had been represented by the plaintiff.
Upon the whole case it, therefore, fully appears that the plaintiff as broker never procured a complete meeting of- the minds of both vendors and vendee, either in writing or by parol, or part one and part the other, and that consequently he had never earned his commission.
That being so, and both parties having moved for the direction of a verdict, the verdict should have been directed for the defendants.
The exceptions taken by the defendants should be sustained, the verdict set aside, and a new trial ordered, with costs to the defendants to abide the event.
Sedgwick, Oh. J., and Me Adam, J., concur.