Court Opinion

ID: 8021750
Source: CourtListenerOpinion
Date Created: 2022-09-09 02:26:22.526393+00
Date Added: 2024-06-11T16:36:41.283888
License: Public Domain

MR. CHIEF JUSTICE BRANTLY
delivered .the opinion of tbe court.
Plaintiffs are copartners, doing business as real estate brokers at Lewistown, Montana. In this action, they seek to recover the sum of $5,000, alleged to be due them for their services to defendant in procuring a purchaser of 450 shares of the capital stock of the Lewistown Brewing Company and of certain real estate situated near Lewistown, in Fergus county, all the property of the defendant. The trial resulted in a judgment for the plaintiffs. The defendant has appealed from the judgment and an order denying him a new trial.
There is serious question whether the issue made by plaintiffs’ reply to defendant’s answer does not present substantial departure from the cause of action alleged in the complaint; but, under the view we have taken of the merits of the ease as disclosed by the evidence, we deem it unnecessary to give special notice to this feature of the case. In our opinion, the evidence is insufficient to show a liability on the part of the defendant.
It appears that on November 4, 1910, the defendant gave to the plaintiffs, in writing, an exclusive agency to sell the stock, which constituted a controlling interest in the brewing company, for a period of thirty days, with a right of extension for thirty days’ additional time in case a sale had not been effected, but with the proviso that after the expiration of the first period of thirty days the defendant was to be free to sell to any purchaser found by himself. The minimum price fixed by the agreement was $60,000. Of this plaintiffs were to receive a commission of $5,000. If a sale should be effected at a price in excess of $60,000, the plaintiffs were to receive one-half of the excess, in addition to the commission of $5,000. A sale was not effected during the life of the agreement, though negotiations had been had by plaintiffs with different parties, particularly with one Borgeson, who resides in Butte, and who had visited Lewistown to examine the brewery property in December, 1910, with a view of effecting a purchase of the stock through the agency of plaintiffs. These negotiations failed, because Bor-*449geson insisted upon making payment of a part of the purchase price by a transfer to the defendant of property in Butte, which defendant was unwilling to accept.
On or about April 1, 1911, the plaintiffs, still hoping to effect a deal with Borgeson, solicited from defendant permission to renew their negotiations to that end. Defendant gave his.consent orally, but stipulated that the deal should include, also, seven or eight acres of land belonging to him, and situate adjacent to the brewery property. ■ Defendant fixed his price for the whole property at $70,000. There was no specific agreement as to the amount of commission the plaintiffs were to receive; but the parties understood it was to be $5,000. The defendant told the plaintiffs that he was then negotiating with other parties for a sale of the stock; and that if he could effect a sale in the meantime he would do so. On April 2 plaintiff Hanley induced the defendant to accompany him to Butte to examine the Borgeson property with the hope of gaining his consent to take it. Upon examination of it, defendant expressed himself to both Borgeson and Hanley as willing to take it at $35,000, the price fixed by Borgeson. Borgeson had not theretofore examined the land belonging to the defendant. He stated that he would accept the defendant’s property, both the stock and the land, if, upon examination, he found the brewery in the same condition it was when he had seen it in December, and if the land and the stock were worth the money demanded by defendant. At that time, Borgeson was recovering from an illness, and was unable to go at once to Lewistown with Hanley and defendant. He stated that he would go in a few days. Upon being told by defendant, in Hanley’s presence, that he was negotiating with other persons, and that he intended to let the stock go to the first person with whom he could close a deal, Borgeson told him that, if he could sell in the meantime, to do so. One Hodel, a stockholder in the brewing company, had theretofore offered to buy the defendant’s stock, but had not been able to procure the funds necessary. He was then making an effort to do so. On the evening of April 11, Hanley informed defendant by telephone that Borgeson *450would arrive in Lewistown that evening, and would be ready to make the deal. Borgeson did arrive as expected. About 8 o ’clock on the next morning, Hanley informed defendant of Bor-geson’s arrival, and stated that he was “ready to do business.” The statement was also made that Borgeson and Hanley would drive at once to the brewery, where defendant then was. Bor-geson, being still weak from his illness, was not ready to go at that time, but expected to go later in the day. About 9:30 o’clock, the defendant went to the office of plaintiffs and informed them that he had closed his deal with Hodel, and that the negotiations with Borgeson were to be considered at an end. He had in fact made a sale of the stock to H-odel about ten minutes after he had been informed of Borgeson’s presence in Lewistown.
It appears from the testimony of Borgeson that his purpose in going to Lewistown was to close the deal with defendant, provided, upon examination of the property, he found it to be as represented to him, and, in his opinion, was worth the money demanded for it. In this connection, he testified: “I had not noticed that ground when I was there in December. I was told that it belonged to Iiogl individually, and he kept that as a home and also rented houses. I felt on that day that I would have been willing to have taken the property under the terms named on the morning when I arrived in Lewistown. No, sir; I would not say I was ready, willing, and able to do it until I had seen it. That is true that that was really the cause of my whole trip from Butte over here. I didn’t know the real estate, or the condition the brewery was in, is why I didn’t close up the deal and buy it. Mr. Hogl told me over at Butte, in the presence of Hanley, that he could not hold it for me; that first come, first served; and Hanley was present when he told me that. I said he should not hold it, in case of losing any sale on account of me; and as soon as I would be able I would come over, and I came of my own accord.”
A broker is entitled to his commission when he shows (1) that [1] he was employed to sell or exchange property, or to procure *451a purchaser therefor; and (2) that he found and introduced to his principal a person who was ready, able, and willing to purchase or exchange upon the terms proposed by the principal, or which were acceptable to him. (2 Clark & Skyles on the Law of Agency, sec. 771.) It is not necessary that a sale should be actually consummated, or that the broker has himself made a binding contract with the purchaser. It is sufficient if the principal is in a situation to execute it himself. (Id.) “The primary duty of the broker consists in bringing the minds of the vendor and vendee to an agreement. To entitle him to commissions, he must produce a purchaser ready and willing to enter into a contract on the employer’s terms. This implies and involves the agreement of buyer and seller, the meeting of their minds produced by the agency of the broker.” (Rapalje on Real Estate Brokerage, sec. 73.) In McGavock v. Woodlief, 20 How. 221, 15 L. Ed. 884, the court stated the rule thus: “The broker must complete the sale (that is, he must find a purchaser in a situation ready and willing to complete the purchase on the terms agreed on) before he is entitled to his commissions. Then he will be entitled to them, though the vendor refuse to go on and perfect the sale.” However the forms of expression adopted by different courts may vary in the terms employed, they are generally in agreement in their statement of the rule. It was said by Judge Finch, in Sibbald v. Bethlehem, Iron Co., 83 N. Y. 378, 38 Am. Rep. 441: “The duty he [the broker] undertakes, the obligation he assumes as a condition of his right to demand commissions, is to bring the buyer and seller to an agreement. In that all the authorities substantially concur, although expressing the idea with many differences of phrase and illustration.” The following cases are in point: Wylie v. Marine Nat. Bank, 61 N. Y. 415; Hardy v. Sheedy, 58 Or. 195, 113 Pac. 1133; Gunn v. Bank of California, 99 Cal. 349, 33 Pac. 1105; Mattingly v. Pennie, 105 Cal. 514, 45 Am. St. Rep. 87, 39 Pac. 200; Darrow v. Harlow, 21 Wis. 306, 94 Am. Dec. 541; Finnerty v. Fritz, 5 Colo. 174; Hurd & Wilkinson v. Neilson, 100 Iowa, 555, 69 N. W. 867; Coleman’s Exr. v. Meade, 13 Bush (Ky.), 358; Jones v. *452Stevens, 36 Neb. 849, 55 N. W. 251; Wilson v. Mason, 158 Ill. 304, 49 Am. St. Rep. 162, 42 N. E. 134; Veazie v. Parker, 72 Me. 443; Ward v. Gobi, 148 Mass. 518, 12 Am. St. Rep. 587, 20 N. E. 174. Some of these cases go so far as to hold that the negotiations must result in a binding contract between the purchaser and the seller. In our opinion, however, the broker is entitled to his commissions if he produces a purchaser ready to accept, and who does accept, the offer made by the seller according to its terms.
It is clear from the summary of the evidence given above that the plaintiffs did not bring themselves within this rule. It was [2] understood by all the parties that no agreement was reached by the defendant and Borgeson at Butte. Borgeson reserved the right to examine the brewery property and the land before finally making up his mind. His trip to Lewistown was for the purpose of examination. He was not committed to anything until he had accomplished the purpose of his visit. The defendant had not given the plaintiffs the exclusive right to find a purchaser. He therefore had the right to sell, in any event, until a purchaser had been found by the plaintiffs who stood ready to accept the property without condition, and he was notified of that fact. (Darrow v. Harlow, supra; 2 Clark & Skyles on the Law of Agency, sec. 776.) To put this beyond doubt, he had informed both the plaintiffs and Borgeson that he was negotiating with other persons,, and intended to sell if he could. Notwithstanding his knowledge of Borgeson’s presence in Lewistown to examine the property, until the examination had been made and Borgeson had definitely accepted his offer, he was not de-vested of this reserved right to sell to Hodel, or anyone else, any part of the property at any price which he chose to accept. He was not under any obligation to wait until Borgeson could reach a conclusion as to what he should do. Therefore, the plaintiffs did not put defendant in such a position that he was required to complete a sale to Borgeson, however ready the latter might have been to accept defendant’s offer according to its terms, after he had accomplished the purpose of his visit. Borgeson still had the right to accept or reject the offer. Hence a meeting of the *453minds of the seller and purchaser was not produced by the agency of the plaintiffs.
(Submitted May 29, 1912.
Decided May 31, 1912.)
It is not of import that the plaintiffs expended time and money [3] in their attempt to procure a purchaser, which the evidence shows to be a fact. Under the terms of their employment, their reward was dependent upon their success. Any expense of time or money made by them, however great it might have been, was at their own risk. (Sibbald v. Bethlehem Iron Co., supra; 2 Clark & Skyles on the Law of Agency, see. 776.)
The judgment and order are reversed. The cause is remanded to the district court, with directions to enter judgment for the defendant.

Reversed and remanded.

Mk. Justice Holloway concurs.
MR. Justice Smith did not hear the argument and takes no part in the foregoing decision.