Court Opinion

ID: 8021751
Source: CourtListenerOpinion
Date Created: 2022-09-09 02:26:22.528389+00
Date Added: 2024-06-11T16:36:41.285729
License: Public Domain

On Motion for Rehearing.
MR. CHIEF JUSTICE BRANTLY
delivered the opinion of the court.
In their brief in support of a motion for rehearing, counsel contend that, though the defendant had reserved the right to make a sale, the reservation was with reference to the whole property, both the stock and the land; and hence that, while, under the circumstances disclosed by the evidence, the defendant could lawfully have sold it, thereby revoking the authority of plaintiffs and freeing himself from liability to them for a commission, he could not, and did not, accomplish this by effecting a sale of the brewery stock, a part of' it, after the negotiations with Borgeson were approaching completion.
As between the principal and agent, the authority of the agent may be revoked at any time. The relation of principal and agent is a personal one; and if the principal does not care longer *454to repose trust in the agent, the law will not compel him to do so. This general rule is subject to the important limitation that, when the authority is coupled with an interest, the principal cannot revoke it without regard to such interest, except at the peril of liability for damages as for the breach of any other contract. The principal may agree that for a definite period the agent may have the exclusive right to exercise a given power. If, in such ease, the principal violates his agreement by exercising the power himself, he cannot escape liability under the claim that he has revoked the agent’s authority to exercise it.
So when an owner employs a broker to obtain a purchaser for his property for a commission, knowing that the effort to find a purchaser and effect a sale will involve the expenditure of time and labor, and the agent does this in good faith, with the result that his efforts are approaching success, the owner cannot with impunity revoke his authority, for the purpose of evading payment of the commission and effect the sale himself. Nor, for the same reason, may he disable himself from carrying out the contract of sale after the broker has found a purchaser who has accepted the offer made by the owner according to its terms. Under such circumstances it may well be said that the owner is under obligation to allow the broker a reasonable time within which to complete the negotiations. On this subject Mr. Meehem in his work on Agency says: “So where an agent is employed to perform an act which involves expenditures of labor and money before it is possible to accomplish the desired object, and after the agent has in good faith incurred expense and expended time and labor, but before he has had a reasonable opportunity to avail himself of the results of this preliminary effort, it could not be permitted that the principal should then terminate the agency and take advantage of the agent’s services without rendering any compensation therefor. Thus, if a broker employed to sell property, had in good faith expended money and labor in advertising and finding a purchaser, and was in the midst of negotiations which were evidently and plainly approaching success, and the seller would revoke the authority, with the purpose of availing himself of the broker’s efforts and avoiding the payment of his *455commission, it could not be claimed that the agent had no remedy. In these cases, it might well be said that there was an implied contract on the part of the principal to' allow the agent a reasonable time for performance; that full performance was wrongfully prevented by the principal’s own acts; and that the agent had earned his commission.” (Mechem on Agency, sec. 620.) To the same effect is the holding of the supreme court of California, in the case of Blumenthal v. Goodall, 89 Cal. 251, 26 Pac. 906, cited by counsel.
The facts of this case, however, do not bring it within these principles. The evidence clearly discloses that, while the plaintiffs were employed to find a purchaser for both the brewery stock and the land, they understood that the negotiations in which the defendant was engaged pertained exclusively to the brewery stock; and that it was with reference to it only that the reservation was made. Hence the plaintiffs knew that the defendant might at any time effect a sale of the stock only, and thus render abortive their negotiations with Borgeson. Under these circumstances, the defendant was free to sell the stock at any time until Borgeson had definitely accepted the offer made to him.
It is suggested that the defendant acted in bad faith in accepting Hodel’s offer for the stock, after he had been informed that Borgeson was in Lewistown ready to make examination of the property; and that he should be held liable for this reason. As we have seen, he did exactly what he had reserved the right to do. He is therefore not open to the charge of bad faith.
The motion is denied.
Me. Justice Holloway concurs.
Rehearing denied May 31, 1912.