Court Opinion

ID: 3490826
Source: CourtListenerOpinion
Date Created: 2016-07-05 21:59:18.961984+00
Date Added: 2024-06-11T13:44:37.412055
License: Public Domain

This is a suit at law in which plaintiffs, a brokerage firm and copartnership formerly doing business under the name of Whitlock, Smith  Company, seek to recover from defendants certain commissions claimed to be due them for arranging the sale of all of the capital stock of the American Broach 
Machine Company, of Ann Arbor, Michigan, to the Sundstrand Machine Tool Company, of Rockford, Illinois. Suit was begun August 10, 1936, but was dismissed in May, 1937, on the ground plaintiffs were violating the statute of frauds by seeking to recover a commission on a parol contract involving the sale of an interest in land. Upon appeal to this court, the case was reversed and remitted to the circuit court. Hague v. DeLong,282 Mich. 330. Thereafter the case was tried without a jury, and from judgment for defendants, plaintiffs have appealed.
Plaintiffs' declaration contains three counts:First, against appellee Francis J. Lapointe alone, upon an express contract; second, against all of the former stockholders of the American Company, upon such express contract; and, third, upon the common counts for recovery upon an implied contract for a reasonable commission. Plaintiffs' right to recover is founded upon negotiations carried on between R. Harold Hyde, an employee of plaintiffs since 1933, and Francis J. Lapointe, the controlling owner and president of the American Company. Mr. Hyde first became interested in the sale of the American Company in 1930 when he was offered one-half of a 10 per cent. commission to be paid Apple-Cole Company by defendant Francis J. Lapointe for the sale of the stock of the American Company. After the termination of the Apple-Cole contract in April, 1930, Hyde was approached by Lapointe, who asked him to find a purchaser of the American Company. *Page 264 
From April, 1930, until August, 1935, Hyde unsuccessfully tried to arrange a sale of the American Company. During this time he frequently corresponded with Lapointe, who upon three occasions called upon Hyde to discuss matters relative to the proposed sale.
August 29, 1935, Hyde visited Lapointe at Ann Arbor. Hyde testified that it was there agreed that he was to devote his time to finding a purchaser of the capital stock of the American Company, that Whitlock, Smith  Company "would charge him a commission of 10 per cent. payable if, as and when," the sale to be "on a basis of net worth, as determined by an audit and appraisal, plus 10 per cent. for patents and good-will, patent licenses and good-will." Lapointe denied any such agreement. He said Hyde called upon him at his office August 29, 1935, but that all he did was ask about Kearney  Trecker Company, a manufacturing company in Milwaukee, Wisconsin, and ask for a letter of introduction to Mr. Edwards, its vice-president. The following day, August 30, 1935, Hyde is purported to have written a letter to Lapointe which in effect confirmed the agreement made in Ann Arbor the day before. Defendants denied receiving this letter although counsel for defendants admitted it was written and the record unquestionably shows it was stamped and mailed. September 5, 1935, Hyde sent a letter to the Sundstrand Company stating that Whitlock, Smith  Company were authorized to offer for sale "all of the capital stock" of an unnamed broaching company. September 6th, the Sundstrand Company, through Mr. Hugo Olson, president and general manager, replied that it was sufficiently interested to desire more information. Following an exchange of correspondence between Hyde and Olson, a meeting was arranged at Ann *Page 265 
Arbor November 8th between the Sundstrand officials and Mr. Lapointe. At this conference Lapointe explained that he was tired of running the whole business and that it was his desire to sell the entire business, including the capital stock, the real estate, and the patents, and become associated with the purchasing company in a capacity where he could devote his time to development and invention. In reply to Lapointe's statement that he desired to sell the real estate, the Sundstrand officials stated their company did not wish to acquire additional real estate and suggested that Lapointe lease the real estate.
Following an exchange of letters in which Hyde intimated that Lapointe might be willing to drop the sale of the real estate, a second conference was held, this time at Chicago on December 7th. Although no agreement was reached as to the real estate, it was clearly apparent that Sundstrand was seriously considering buying the American Company. Arrangements were made to send auditors from the Sundstrand Company to Ann Arbor to audit the books of the American Company, the purpose of the audit being to establish the net worth of the American Company. The conference was adjourned at noon, and Hyde and Lapointe took the 12:30 train for Ann Arbor. Lapointe testified that it was on the train he had the first intimation that Hyde was expecting to be paid a 10 per cent. commission. He testified:
"On that trip back from Chicago, the last part of the trip, Mr. Hyde was making some pencil figures on a paper which I didn't pay much attention to until he spoke to me. After totalling these up he advised that he figured that their cash amount for him would be $40,000, or more, and that rather startled me because I couldn't see where the deal was going to develop to any point where there would be that much involved for his services, because I *Page 266 
had not entered into any contract at that time with him. He had been asking me continually to let him keep trying to interest someone, and when he had them, I intended to enter into a contract with him, which I tried to do a little later, and I didn't say much more that day but got to thinking about it and I knew, with the expense that was going to be involved and the net amount I would receive after paying taxes and buying the other stock, it looked to me as if the figures he set for his services was certainly out of reason."
Lapointe visited the Sundstrand plant at Rockford December 12th, and on the 14th called at Whitlock, Smith  Company to see Hyde. At this point, the testimony again becomes sharply conflicting. Hyde testified that at this time Lapointe told him that "while he liked the thought of the deal with the Sundstrand Machine Tool Company that he did not feel he could go ahead with the deal unless we would be willing to accept half of the commission, or 5 per cent. from him and try to collect the other 5 per cent. from Sundstrand." Lapointe said he called upon Hyde because he thought the Sundstrand people were actually interested in buying the business and he was anxious to make an agreement as to the amount of commission to be paid Hyde. He testified:
"I had no agreement up to that time with him. He just had been previously asking me to let him continue to see if he could find someone he could interest in it, and I had never taken any of these seriously. * * * I made a suggestion there that if the deal ran up to $100,000, that I considered $3,000 would be a good reimbursement for his services. If it went over that, that $4,000 would be a good amount for him to receive, and if it was over $200,000, that I figured $5,000 would be a very good amount for *Page 267 
his services in making the contract. * * * When I made this proposition Mr. Hyde said nothing definite other than he wanted to consider it and study it over, and then the matter reverted back to the conversation that it might be possible to get them to consider the buildings and land, and so forth."
December 23d the American Company declared a dividend payable in real estate and buildings, thus segregating from the assets remaining in the company all real estate. Four days later, December 27th, Lapointe again came to the offices of Whitlock, Smith  Company where Hyde again demanded a 10 per cent. commission and Lapointe again offered to pay a smaller amount. After trying without success by telephone on December 31, 1935, and January 2, 1936, to agree as to amounts payable on commissions, Lapointe, February 4, 1936, signed a contract under which the Sundstrand Company acquired the American Company.
Under the terms of this contract, Sundstrand purchased all of the outstanding stock (297 shares) of the American Company. Of this amount, 175 shares were owned by Mr. and Mrs. Lapointe as joint tenants; 114 shares by Mr. and Mrs. Lapointe in trust for their three children; and 8 shares by Mr. DeLong. Sundstrand also purchased the services of Mr. Lapointe for five years; certain patents, patent applications and inventions owned by Lapointe individually; certain patents, patent applications and inventions owned by Metal Cutting Tool Service, Inc., an Ohio corporation, entirely owned by Lapointe; a five-year lease from Mr. and Mrs. Lapointe of the land and buildings; and an option to purchase the land and buildings within three years at an appraised value of $148,000. Under the terms of the contract, Sundstrand gave Lapointe, as consideration for what it had purchased, 29,145 shares of *Page 268 
Sundstrand stock at a value of $10 a share. This represented the appraised value ($291,450) of the American Company. Simultaneously with the delivery to Lapointe of the 29,145 shares of Sundstrand stock, McGowan, Cassidy  White, Inc., brokers, purchased 25,945 shares for which they gave Lapointe a check for $259,450. From the $259,450 and 2,418 shares of stock thus acquired, Lapointe gave $14,000 and 782 shares of stock to DeLong as consideration for DeLong's interest in the corporation.
At the conclusion of the testimony, the trial judge made certain findings of fact. The findings of fact relevant to the determination of this case are:
1. Plaintiffs had an oral agreement with defendant Francis J. Lapointe to effect a sale of the business of the American Broach  Machine Company;
2. The facts make it clear that it was an implied term of this contract that the plaintiffs were to be paid a reasonable commission for its performance;
3. The Sundstrand Company was not ready, able and willing to buy the business on the terms on which plaintiffs had a special contract to sell;
4. Plaintiffs' agreement with Francis J. Lapointe was not for a sale of stock, but for a sale of the business of the American Broach  Machine Company.
The trial judge then held as a matter of law: (1) plaintiffs could not recover upon an express contract for 10 per cent. as they had no contract; (2) plaintiffs could not recover upon the common counts because (a) plaintiffs did not find a purchaser who was willing to buy upon the terms and conditions upon which plaintiffs were employed to sell; (b) the contract between Hyde and Lapointe was for the sale of real estate and not being in writing was void under the statute of frauds (3 Comp. Laws 1929, § 13417 [Stat. Ann. § 26.922]); (c) plaintiffs were *Page 269 
not licensed as business chance brokers as required by statute of any person or partnership which sells businesses as a whole or partial vocation (2 Comp. Laws 1929, § 9806 [Stat. Ann. § 19.791]). Plaintiffs have appealed to this court under Court Rule No. 64 (1933) and the decision in Jones v. EasternMichigan Motorbuses, 287 Mich. 619, claiming the findings of fact of the trial judge are "against the preponderance of the evidence," and that as a matter of law plaintiffs should recover upon the common counts.
At the outset, it may be said that the trial judge was in error as to the first two reasons assigned by him for denying recovery upon the common counts. Unless the principal has by clear language so conditioned his promise to pay commissions that the commission is payable only if the broker sells upon the originally specified terms, the broker is entitled to his commission if he produces a purchaser upon such modified terms as the principal may subsequently accept before the agency is revoked. 2 Restatement of Law of Agency, pps. 1120, 1121, § 447, comments a and b; MacMillan v. C.  G. Cooper Co.,249 Mich. 594. The record reveals that long before the agency was revoked, Lapointe had receded from his original terms and had shown a willingness to sell the business without including the real estate. Nor is recovery prevented by the statute of frauds (3 Comp. Laws 1929, § 13417 [Stat. Ann. § 26.922]). Although the original agreement which called for a sale of the real estate was within the terms of the statute (Morris v. O'Neill,239 Mich. 663), this court has held that the sale as actually consummated was enforceable without a writing. Hague v. DeLong,supra. As defendant Francis J. Lapointe acquiesced in the terms of the sale as actually consummated, he should not be able to claim there may be no recovery simply because his original *Page 270 
agreement with plaintiffs was within the statute. It may also be observed that nowhere in the record does it appear that Lapointe purported to act for the other defendant stockholders or act as their agent in the sale of the American Company. Thus, plaintiffs' right of recovery, if it exists at all, is against Francis J. Lapointe alone. Counsel for Lapointe frankly admit that Hyde was the procuring cause of the sale and that Lapointe did have a contract with Hyde to pay him the reasonable value of his services if he were successful in finding a purchaser for the American Company. Counsel claim, however, that plaintiffs may not recover upon the common counts since plaintiffs were not licensed under the business chance statute. Thus, the issues to be determined by this court are: (1) does the preponderance of the evidence establish an express contract under which defendant promised to pay Hyde a commission of 10 per cent. of the sale price; (2) does the preponderance of the evidence establish a contract for the sale of a business or a sale of stock; (3) if the preponderance of the evidence establishes an agreement for the sale of a business, are plaintiffs prevented from recovery for want of a license to sell businesses?
This court should be extremely reticent to disturb the findings of fact of the trial judge. Plaintiffs' claim that there was an express contract for 10 per cent. commission and that the contract was for the sale of stock rather than a business is predicated upon the meeting between Lapointe and Hyde on August 29, 1935. Yet, 573 pages of printed record and 148 pages of exhibits contribute surprisingly little to the determination of exactly what occurred on August 29, 1935. With but few exceptions, the conflicting claims are almost entirely supported by the bare words of the contesting parties. In such *Page 271 
cases, this court must remember that the trial judge, who alone has had the opportunity to observe the witness and hear his testimony, is the best judge of the veracity of the conflicting versions of testimony. In such instances, this court should not seize upon every bit of contradiction and scrap of evidence and magnify its importance until it assumes a probative force wholly incommensurate with the facts.
"We are reluctant to disturb findings which involve the adoption of one of two conflicting versions in testimony."Paton v. Stealy, 272 Mich. 57.
"We are not ordinarily inclined to substitute our determination for that of the trier of the facts, especially when there is a conflict of testimony." Buhler v. City ofDetroit, 274 Mich. 139.
" 'The law permits the trier of the facts a wide discretion in determining what those facts are. We do not substitute our judgment on questions of fact unless they clearly preponderate in the opposite direction.' " Rubsam Corp. v. General MotorsCorp., 281 Mich. 691.
If it were for no other reason than this, we are of the opinion in this case that the findings of fact of the trial judge should be affirmed. However, without even going beyond the bare words of the record, we are convinced that the preponderance of the evidence shows: (1) there was not a contract to pay plaintiffs a 10 per cent. commission; and (2) the contract was for the sale of the business and not for a sale of stock.
1. On direct examination, Hyde testified that his contract with Lapointe was the same as he had had with him on prior occasions. As to a previous agreement with Lapointe, he testified upon direct examination:
"It was either in January or February, 1933, Mr. Lapointe came to see me again, visited me at my *Page 272 
home when I was ill and confined to my room. We discussed another deal at that time. He wanted me to go to work again, try and work out a deal for the sale of either all or part of the American Broach and made the same agreement as to commission, 10 per cent. payable if, as and when. That was 1933."
Yet, on cross examination, his story of previous agreement was badly shaken.
"Q. Didn't you testify in your direct examination that when he came to your home he wanted you to go ahead, and you made an agreement to go ahead on a basis of a 10 per cent. commission?
"A. The 10 per cent. commission arrangement was discussed at the time Mr. Lapointe came to my home; whether it was 1931 or 1933 I can't be certain.
"Q. Well you made that agreement with him at the time you were sick in your home?
"A. Yes.
"Q. And your best recollection is that it was in 1931?
"A. I'm not certain. I have told you I was ill in the late winter of 1931 and again in 1933 and I can't be certain which time it was Mr. Lapointe came to the house. * * *
"Q. Then you are uncertain whether you had the agreement with Mr. Lapointe in 1933, is that true?
"A. I had another agreement with him at that time because I went to work, endeavoring to work out a deal again in 1933 for a short time. I spent only a very little effort on it.
"Q. Well, if the agreement was not made at your home when you were sick in 1933, when and where was it made?
"A. I can't tell you that, whether it was made in the office or over the phone, or in his office, because I stopped out here at the American Broach frequently when I was driving this way. *Page 273 
"Q. Then you are not certain as to the date or place, when or how, but you are still certain that you had an agreement?
"A. I had an agreement, certainly."
Hyde was asked if he had ever had a written contract with Lapointe for 10 per cent. commission. He said he had a written agreement with him in 1930 or 1931. When called upon to produce the contract, he said it was lost in 1936 when he had moved. It is, indeed, extraordinary that an astute business man like Mr. Hyde, who was representing another in an important financial transaction involving a substantial sum of money, could not produce a single writing or contract showing the terms of his employment. The best proof submitted by plaintiffs that there was a contract for 10 per cent. is the letter written by Hyde to Lapointe August 30, 1935. That part of the letter most favorable to plaintiffs reads:
"These negotiations will, of course, be handled in the name of Whitlock, Smith  Co., and in the event it should be possible for us to work out a deal for the sale of all or a portion of your business on terms and conditions satisfactory to you along the lines and basis discussed with you yesterday, we would want a commission of 10 per cent. payable if, as and when payments are made to you."
Lapointe denied that he received this letter, although the record clearly shows it was stamped and mailed. However, this letter would seem to negative, rather than confirm, the claim that on the preceding day there was a contract made for 10 per cent. commission. By the terms of the letter, the matters "discussed with you yesterday" related to the terms and conditions at which Hyde was to offer the business to a prospective purchaser and were exclusive of the amount of commission to be paid. *Page 274 
In their brief, plaintiffs argue that Lapointe's silence after receiving the letter was an acceptance and thereby a definite contract came into existence. But plaintiffs' declaration states that the contract was made on August 29, 1935, and that the letter of August 30, 1935, is merely confirmation thereof. In such instances, the pleading is controlling.
Hyde's method of conducting negotiations suggests that he did not have an agreement for a 10 per cent. commission. He testified that Lapointe told him the approximate net worth of the American Company was $470,000, of which $148,000 was real estate. If the business were sold for $470,000, then, at 10 per cent., Hyde would receive $47,000; if it sold for the net worth minus the real estate, then he would receive $32,200. Yet, the undisputed record shows that shortly after negotiations began, Hyde wrote Mr. Olson relative to the real estate that "it is possible that he (Lapointe) might be willing to consider some adjustment or concession which would conform to your ideas and plans." The abandon with which Hyde cut a possible $14,800 from his commission suggests that he never had a contract for a 10 per cent. commission. One other significant fact appears in the record which suggests that Lapointe expected to pay Hyde a flat fee ranging from $3,000 to $5,000 rather than 10 per cent. of the purchase price. Hyde claimed he had an agreement with Lapointe for 10 per cent. of the purchase price in 1930, 1931, 1933, 1934 and 1935. Yet, the undisputed record shows that Lapointe never treated Hyde as one to whom he was expecting to pay a substantial sum of money. He frequently avoided Hyde, and on occasion did not answer his urgent requests for information. For the five years during most of which Hyde is purported to have represented Lapointe, plaintiffs have offered but seven *Page 275 
letters sent by Lapointe to Hyde. In the letter of August 30, 1935, Hyde asked Lapointe for a record of sales and a confidential statement of unfilled orders. They were never sent. February 8, February 25, and April 29, 1935, Lapointe wrote Hyde instructing him to drop any negotiations he was carrying on with Vickers Company. August 22, 1935, Lapointe wrote Hyde that he did not know when he could arrange to see him. It was Hyde, and not Lapointe, who requested the conference on August 29, 1935. Lapointe testified:
"I had conversations with him but you will notice from the letters handed me that I always avoided going in there and seeing him at his request, and without saying any unkind words about Mr. Hyde, my visits to his office were always boresome, because it always wasted three or four times as much time as it should to get to the point."
The same point was made by Mr. O'Connor and Mr. Olson:
"We had no particular reason for ignoring Mr. Hyde other than that he wasn't very helpful in the negotiating. I mean his conversations were mostly about unrelated matters and we felt he wasn't of any particular assistance to us. We could do it more quickly ourselves." (Mr. O'Connor)
"That was all that bothered us about Mr. Hyde and the fact we didn't seem to get any assistance in giving us the information which we needed." (Mr. Olson)
The general impression left by the record is that Hyde constantly forced himself upon Lapointe, who tolerated him, who was as surprised as he was pleased when he produced an interested purchaser, who made a genuine and persistent attempt to pay Hyde what he believed was a reasonable fee, but *Page 276 
never would have planned to give a 10 per cent. commission (amounting to $30,000 at least) to one whom he never thought efficient.
Contrasted with Hyde's contradictory testimony and conduct is the consistency of the story told by defendant Lapointe. He frankly admitted that in 1930 he had agreed to pay Apple-Cole Company a 10 per cent. commission, yet he consistently denied ever having made such an agreement with Hyde. During the entire course of the trial, the only serious flaw that appeared in defendant's story was his statement that he did not know Hyde was associated with Whitlock, Smith  Company. He was forced to retract this upon cross examination. On direct examination, Lapointe denied that Hyde had ever represented him prior to 1935. This statement was not shaken when counsel for plaintiffs produced an agreement, signed by Lapointe and the Foster Machine Company, under which William C. Roney  Company, with which Hyde was then associated, was to purchase a portion of the stock issued by the Foster Machine Company. Lapointe said that under this contract the William C. Roney Company represented the Foster Machine Company and Apple-Cole Company represented him. While it is difficult to explain Mr. LaPointe's silence on the train on December 7, 1935, when Hyde informed him that he expected to be paid approximately $40,000, it is even more difficult to explain plaintiffs' silence about the letter purportedly written August 30, 1935. It is, indeed, strange that from the time it was supposedly written until the time of the trial it was never mentioned by plaintiffs, not even in reply to Lapointe's claim that he had never made an agreement with plaintiffs for a commission of 10 per cent.
2. We are likewise of the opinion that the greater and more convincing evidence is that the agreement *Page 277 
was for the sale of the business and not for the sale of stock. Subsequent conduct is always important in determining the nature of prior understandings. McConville v. Remington Rand,Inc., 278 Mich. 333. And it is undisputed in the record that subsequently Lapointe sold and Sundstrand purchased not only the stock of the American Company, but also valuable patents and patents pending, the services of Mr. Lapointe, a lease, and an option to purchase the real estate and buildings. In consideration, Sundstrand paid $291,450 (29,145 shares of Sundstrand stock at $10 a share). Not all of the amount paid was for the stock alone. The record is convincing that the Sundstrand Company was buying the business and not the stock. Mr. O'Connor, director and member of the executive committee of Sundstrand Company, testified:
"So far as the machinery was concerned, when we took over the business, we promptly wrote off $40,000. If we intended to get into the broaching machine and tool field we figured it would cost us $200,000 before we could get ourselves established, and that would probably result in some infringement suits, and we figured if we were paying $100,000 or $150,000 more than the assets of this concern was worth, that would be offset by the patents we were buying, the going business and the management that would remain as it was, and we wanted to be sure that we would have a lease on the property with an option to buy at the appraisal value. * * *
"Q. Why did you buy the stock of the American Broach?
"Mr. Smith: I object to why they bought it. * * *
"Court: Take the answer.
"A. That was merely a means of obtaining the assets of the concern including the goodwill, patents, leases, options, and services of Mr. Lapointe. It was just a means of arranging payment. * * * We never *Page 278 
considered buying the stock. We were buying the assets and what went along with the assets as a going business."
We are cognizant that proof in the record that the Sundstrand Company bought the business rather than the stock does not require the conclusion that as between Hyde and Lapointe the agreement was for the sale of the business. But it is persuasive. It would be asking too much to assume that Lapointe would not know in advance that a prospective purchaser would be primarily interested in the business and only secondarily interested in purchasing the stock. It is also very clear from reading the record that Hyde knew that it was the business and not the stock that Lapointe was anxious to sell. The record is replete with statements by Hyde that Lapointe spent considerable time explaining to him the nature of his broaching patents, their value in the business, and his control over them. Through his five years of occasional contact with Lapointe, Hyde had learned that the patents controlled by Lapointe personally, his managerial ability, and the strategic location of the plant near the automotive industry were indispensable in the success of the American Company. He also knew that a sale of stock would not include the services of Lapointe. He knew, too, that many of the more important patents were not owned by the American Company, but were used by it under a contract with Lapointe and Metal Cutting Tool Service, Inc., a corporation wholly owned by Lapointe. It is wholly unreasonable to believe that Hyde would agree to sell stock alone when an indispensable part of the American broaching business was an item which would not pass with the sale of the stock. Had Lapointe intended to sell the stock and not the business, it is probable that he would have employed a stockbroker. It is significant that *Page 279 
he employed Mr. Hyde who, according to the record, was not an ordinary stockbroker but an industrial broker who on other occasions had sold businesses. On cross examination, Hyde testified:
"Q. So your work has included other things than the sale of capital stock? It has included the sale of businesses, is that right?
"A. Yes."
Hyde's testimony that he was employed to sell stock only was not convincing. Early in the trial, he was asked: "All of these deals had relation, did they not, to stock?" He answered: "Never anything else. Never anything else." Yet. a bit later, he testified:
"I neglected to state that one of the considerations of his deal was to be an employment contract over a period of five years."
Certain of Hyde's testimony is almost an admission that his agreement with Lapointe on August 29, 1935, was for the sale of a business. We quote from the record:
"Q. Then Mr. Lapointe's problem that he came to you with was that he wanted to be relieved of responsibility and the burden he had in his business. He wanted someone else to take it over. Isn't that true?
"A. Partially, yes. * * *
"Q. So, in substance, he said to you, 'Mr. Hyde, I want to get out from under the responsibility and I want an employment contract with the company that takes the business over.'
"A. That's right.
"Q. Now, the problem could have been solved by the sale of the assets of the business, as well as by a sale of the stock, couldn't it?
"A. Possibly. *Page 280 
"Q. Well, couldn't it?
"A. By a complete liquidation of the American Broach and a sale of the assets.
"Q. Yes, by Sundstrand buying the assets from the American Broach instead of buying the stock?
"A. Well, no — yes, it might have been worked out on such a basis, but not at the price that was secured."
The precariousness of plaintiffs' position appears from the fact that the proof upon which it most strongly relies — the letter of August 30, 1935 — does not use the word "stock," but instead uses the word "business." The letter reads:
"And in the event it should be possible for us to work out a deal for the sale of all or a portion of your business on terms and conditions satisfactory to you along the lines and basis discussed with you yesterday, we would want a commission of 10 per cent."
It has been held that a business may be sold by means of selling the stock. O'Brien v. Dunn Iron Mining Co., 141 Mich. 616
. In such an instance, it is not the stock that is sold but the business, and the stock is just a convenient method of making the sale. Whether an agreement is for the sale of stock only, or for the sale of a business with the stock as incidental thereto, depends upon the facts in each case. Here, the fact that Lapointe did not go to an ordinary stockbroker but to a seller of businesses, that he told Hyde he did not wish to sell his stock alone but his services too, that as a reasonable man he must have understood a purchaser would be interested in the business and not the stock, and that the letter offered as confirmation of the agreement speaks of the contract as one for the sale of the business, all lead to the conclusion that Hyde was *Page 281 
employed to sell the business. We reach this conclusion despite the fact that in May, 1930, Lapointe signed a contract with the Foster Machine Company under which admittedly only the stock of the American Company was sold. During the five and one-half years which elapsed between the time of that contract and the negotiations with Sundstrand Company, the machinery and equipment of the American Company had become less and less valuable, while the services of Lapointe, his control over the patents, and the location near Detroit had assumed a greater value.
3. The final issue for decision is whether plaintiffs are prevented from recovery upon the common counts for want of a license to sell businesses. Plaintiffs were licensed to sell stock and deal in securities, but had no license to sell a business as required by the business chance statute providing:
"It shall be unlawful for any person, firm, partnership * * * to engage in the business or capacity, either directly or indirectly, of a business chance broker * * * within this State without first obtaining a license under the provisions of this act." 2 Comp. Laws 1929, § 9806 (Stat. Ann. § 19.791).
"A business chance broker within the meaning of this act is any person, firm, partnership association, copartnership or corporation, who for a compensation or valuable consideration sells or offers for sale, buys or offers to buy, leases or offers to lease, or negotiates the purchase or sale or exchange of a business, business opportunity, or the good will of an existing business for others as a whole or partial vocation." 2 Comp. Laws 1929, § 9807 (Stat. Ann. § 19.792).
The purpose of the law, said this court, is to require a license of: *Page 282 
"those who for compensation perform the acts of agency enumerated 'as a whole or partial vocation.' * * *
"It can be safely said without reviewing the authorities that the courts have quite generally held that a single sale or act of a private citizen in relation to a vocation prohibited by statute without a license is not, standing alone, carrying on the forbidden business." Miller v. Stevens, 224 Mich. 626.
The record discloses beyond contradiction that the sale of the business of the American Company was not the first business that Hyde had sold. Under such circumstances, plaintiffs may not recover upon the common counts.
  Judgment affirmed, with costs in both courts to appellees. SHARPE, CHANDLER, and McALLISTER, JJ., concurred with POTTER, J.