Court Opinion

ID: 9601580
Source: CourtListenerOpinion
Date Created: 2023-08-22 01:47:18.22092+00
Date Added: 2024-06-11T12:38:08.387035
License: Public Domain

WOLFE,
Chief Justice (dissenting).
I dissent. The majority opinion, while recognizing the rule that we must view the evidence and all the inferences arising therefrom in the light most favorable to the party who- prevailed in the trial court, has, I think, failed to follow that rule. The trial court found that there was no meeting of the minds of the parties concerning the sale. There is competent evidence in the record to sustain that finding. It follows as a matter of law that the defendant is not entitled to a commission, regardless- whether the plaintiffs agreed to pay -a commission only if a sale were consummated, as the trial court found, or if the defendant merely found a ready, willing and able buyer, as contended for by Mr. Justice CROCKETT.
The Earnest Money Receipt and Agreement- signed by the parties recited the receipt of $1,000 which was paid by the buyers and provided that an additional $6,000 would be paid by them within 60 days. No provision was made therein for the time and manner of payment of the $19,000 balance, but the following words were typewritten on the printed form:
“earnest money receipt made in lieu of formal contract of purchase incorporating necessary provisions for the understanding and protection of both buyer and seller, and terms and conditions contained herein subject to adjustment agreeable to both parties.”
Thus as to the time and manner of payment of the $19,000 balance, the parties simply agreed to agree in the future. It requires no argument to demonstrate that such a provision renders the agreement illusory. It is contended in the majority opinion that the parties did thereafter orally agree as to the terms and time of payment of the $19,000 balance and that an unsigned memo containing those terms was made by Mark Eggertson during a conference of the parties in his office. However, Mr. Hoyt, one of the plaintiffs, testified that the terms contained in the memo were not acceptable to him unless other problems which confronted the parties could be solved; that he told Mr. Eggertson that the parties had other matters to discuss before they could agree on a contract; and that he instructed Eggertson to wait until the parties solved their difficulties before going ahead and drafting a contract embodying the terms contained in the memo-. Mr. Eggertson likewise testified that the con*17ference in his office was terminated when both parties seemed to agree that there were too many indefinite matters that first had to be worked out before the parties could enter into a contract. Later someone called Mr. Eggertson on the telephone and told him “not to worry about the contract for the time being.”
The matters which had to be resolved between the parties before the plaintiffs would agree to sell to the Johnsons according to the terms contained in the memo were never resolved. One of these problems was that the Johnsons had to obtain a bond assuring Salt Lake City that certain improvements would be made to the lots if the City annexed the subdivision. Under the terms of the Earnest Money Receipt and Agreement it was the duty of the plaintiffs to obtain annexation, but they could not do so until the Johnsons obtained a bond. Tw? bonding companies to which the Johnsons applied declined to bond them. Mrs. Johnson did testify, however, that early in January, 1952, just shortly before the plaintiffs served the demand upon them that they pay the entire balance of the purchase price within five days, they (the Johnsons) found a person who would put up a cash bond for them but on cross examination she would not testify that they had ever informed the plaintiffs of that fact. That the Johnsons never informed the plaintiffs that they could obtain a bond is further borne out by the testimony of Mr. Hoyt that Mr. Johnson told him that he could not qualify for a bond and would “cancel out,” providing the plaintiffs would return his $1,000 .earnest money, plus $900 he had paid toward the purchase of one of the lots.
Another matter which had to be solved before the plaintiffs could agree to sell the lots to the Johnsons on the terms contained in 'the memo was that of inspecting certain Montana property owned by the Johnsons which they were going to pledge to secure the unpaid balance of the purchase price of the lots. Mr. Johnson was to take Mr. Hoyt to Montana to make this inspection. The trip was never made; there is no evidence that either party was responsible for this failure. I cannot agree with the conclusion of the majority opinion that it was due to Mr. Hoyt’s own recalcitrance that the trip was never made. There is no evidence to that effect. In reaching that conclusion, the majority opinion is drawing an inference which is unwarranted and which is unfavorable to the party who-prevailed in the trial court. It is just as. reasonable to infer, although such an inference would, too, be unwarranted, that the failure was due to Mr. Johnson’s dereliction.
Thus there is evidence that the two matters which had to be solved by the parties, before the plaintiffs would agree to sell the lots to the Johnsons on the terms embodied in the memo written by Mr. Eggertson were never solved: (1) the Johnsons, if .'they ever were able to obtain a bond, did'not *18so inform the plaintiffs, and (2) for some unexplained reason the Montana inspection trip was never made.
As heretofore stated, Mr. Hoyt testified that Mr. Johnson told him that he could not obtain a bond, that he was willing to “cancel out” providing the plaintiffs would return his $1,000 earnest money and also pay him $900 which he had paid toward buying a lot in the subdivision. Because the plaintiffs had the right under the Earnest Money Receipt and Agreement to keep the $1,000 earnest money if the Johnsons failed to complete their purchase of the lots, the majority opinion infers that when the plaintiffs chose instead to return it to the John-sons, the plaintiffs must have realized that they were obligated to sell to the Johnsons, else they would not have made this substantial payment for the Johnsons’ interest in the lots. The difficulty with this inference drawn by the majority opinion is that it penalizes the plaintiffs because they were willing to return to the buyers their earnest money which the plaintiffs as sellers had in no way earned, and which would be a windfall to them if they were allowed to keep it. Furthermore, under the rule of Perkins v. Spencer, Utah, 243 P.2d 446, it is doubtful that they could legally keep it. Again, the majority opinion has drawn an inference from the evidence which is unfavorable to the party who prevailed in the lower court.
I, therefore, cannot agree with the majority opinion that it was due to the wilful refusal of the plaintiffs to cooperate with the buyers that the sale was never made. As I have pointed out, there is ample evidence that the matters which had to be solved between the parties before the plaintiffs would agree to sell the lots to the Johnsons on the terms contained in the memo written by Eggertson, were- never solved; that the plaintiffs are not chargeable for the failure of the parties to solve these preliminary matters, but that the failure was due primarily to the Johnsons’ inability to obtain a bond or if they did become able to obtain a -bond, as they contend, to inform the plaintiffs of that fact. These preliminary matters never having •been solved, the plaintiffs were never agreeable to selling the lots to the Johnsons on the terms contained in the memo. The Johnsons were not ready, willing and able buyers because they were never ready, willing and able to purchase the lots on ■terms acceptable to the sellers (plaintiffs). Furthermore, not only were the Johnsons not able to meet the terms of the sellers, but Mrs. Johnson herself testified that she and her husband were not willing to complete the purchase because of the “hostility” of Mr. Hoyt and Mr. Glauser. It therefore follows that even if the defendant was entitled to a commission if he procured a ready, willing and able buyer, as M.r. Justice CROCKETT contends, such a -buyer was not procured by the defendant.
It may be true, as contended for in the majority opinion, that a real estate broker is entitled to a commission when the seller and buyer rescind their contract. That rule, *19however, has no application here as there was no enforceable contract between the parties which they could have rescinded. The so-called rescission agreement referred to in the majority opinion which was executed by the parties when it became apparent that no sale could be consummated, did not purport to rescind any agreement between the parties except the illusory Earnest Money Receipt and Agreement. The so-called rescission agreement merely purported to release each party from' all claims which the other party might have against him, and the Johnsons quitclaimed to plaintiffs any right, title or interest in the property which they might have.
There is no doubt that the defendant’s salesman, Anderson, did perform certain work for and confer certain resulting benefits on the plaintiffs. But it has long been established in this jurisdiction that neither a broker nor an agent may recover upon the basis of quantum meruit, but only upon a contract. Case v. Ralph, 56 Utah 243, 188 P. 640; Watson v. Odell, 58 Utah 276, 198 P. 772, 20 A.L.R. 280; Young v. Buchanan, Utah, 259 P.2d 876. The defendant has not earned its commission under its agreement with the plaintiffs. It is not entitled to compensation for unsuccessful efforts. 8 Am.Jur. 1084, 1085.
McDONOUGH, J., concurs in the views expressed by WOLFE, C. J., in his dissenting opinion.