Court Opinion

ID: 9625158
Source: CourtListenerOpinion
Date Created: 2023-08-22 07:29:32.460925+00
Date Added: 2024-06-11T18:06:01.986254
License: Public Domain

VALLÉE, J.
I dissent. I am of the opinion that plaintiff, whether he be called a “finder,” an “introducer,” or what not, was a broker within the meaning of the Corporate Securities Act and that he was required to have a license. A broker includes every person, other than an agent, who engages either wholly or in part in the business of selling, offering for sale, negotiating for the sale of, or otherwise dealing in, any security issued by others. (Corp. Code, § 25006.) “Sale” includes every “attempt to dispose” of a security, and it includes “an attempt to sell” and “a solicitation of a sale.” (Corp. Code, § 25009.) As alleged and found, plaintiff’s right to compensation was dependent not merely on his arranging an introduction of Lee to defendants but on the introduction resulting in the sale of the stock through the efforts of Lee or Smith, Barney and Company. If introducing one person to another for a consideration with the avowed purpose of having them negotiate with each other for the *564sale of stock, the consideration being contingent on a sale, is not “otherwise dealing in” (as distinguished from “offering for sale” and “negotiating for the sale of”), is not an “attempt to dispose” of the stock, is not “an attempt to sell” the stock, is not ‘ ‘ a solicitation of a sale, ’ ’—then these phrases are meaningless. “Dealing in” is having to do with, being concerned with, making arrangements for. (Webster’s Inter. Dict. 2d ed.) To “attempt” means to endeavor to do a thing. (Idem.) To “solicit” means to endeavor to obtain by asking. (Idem.) To “endeavor” is to strive to achieve. (Idem.) What was plaintiff’s purpose in finding a prospective purchaser? He was having to do with, being concerned with, making arrangements for, sale of the stock. He was striving to achieve a sale of the stock; he was attempting to sell it, to dispose of it; he was soliciting a sale. He had no other purpose.
A person whose business it is to bring buyer and seller together is a broker. (Eaton v. Yount, 48 Cal.App. 221, 224 [191 P. 1009].) The fact that plaintiff had no authority to effect a sale is of no consequence in determining whether he was a broker. (8 Am.Jur. 1011, § 51 et seq.; Holway v. Malloy, 70 Cal.App.2d 317 [160 P.2d 893]; Mason v. Mazel, 82 Cal.App.2d 769 [187 P.2d 98].) The duty of a broker, in the absence of an agreement enlarging his duties, is merely to bring the principals together to negotiate with each other for the purpose of making a contract. (12 C.J.S. 10, § 6.)
Under plaintiff’s contract his right to compensation was expressly made contingent on the introduction resulting in the sale of the stock through the efforts of Lee or Smith, Barney and Company. Plaintiff approached defendants and inquired whether they were interested in selling their Jergins Oil Company stock, and ascertained that they were interested in doing so. He persuaded Lee to come to California for the purpose of negotiating with defendants with respect to the sale of the stock. He introduced Lee to defendants in California for the purpose of having them negotiate for the sale of the stock. I think it obvious that plaintiff was “otherwise dealing in” a security and that he attempted to dispose of it, attempted to sell it, and solicited the sale of it. The finding that plaintiff did not agree to render, or render any services as a broker is not supported by the evidence. The evidence as to plaintiff’s activities is uncontradicted. There is nothing doubtful about the facts. The question whether on the uncontradicted evidence plaintiff was a broker is one of law, not of fact.
*565Neither Shaffer v. Beinhorn, 190 Cal. 569 [213 P. 960], nor McKenna v. Edwards, 19 Cal.App.2d 327 [65 P.2d 810], nor Crofoot v. Spivak, 113 Cal.App.2d 146 [248 P.2d 45], decides the question in this case. Shaffer construed the Real Estate Brokers’ Act of 1919 which defined a real estate broker as a person who, for compensation, sells, or offers for sale, buys, or offers to buy, or negotiates the purchase or sale or exchange of real estate. The 1919 act did not define the word “sale” and it did not contain the phrases “otherwise dealing in,” “attempt to dispose,” “attempt to sell,” or “solicitation of a sale.” McKenna arose under the Corporate Securities Act as amended in 1933. (Stats. 1933, p. 2308.) The court relied entirely on the definition of a broker and on Shaffer v. Beinhorn. At that time the definition of “sale” read substantially the same as it did in 1949 when plaintiff made the contract, but the court gave no consideration whatever to the effect of the phrases “attempt to dispose,” “attempt to sell,” or “solicitation of a sale.” Neither the definition of a sale nor these phrases were mentioned in the opinion. The decision was premised solely on the fact that the plaintiff did not negotiate the sale of stock. The Crofoot case arose under the Real Estate Brokers’ Act as it existed in 1948. The court merely followed Shaffer v. Beinhorn, saying that since it was decided the Legislature had made “no amendments to the pertinent language of the enactment which would change the scope of the Legislature’s definition of who was a real estate broker as that definition was contained in the act current at the time the Supreme Court made its decision.” The Real Estate Brokers’ Act did not then nor does it now contain a definition of “sale,” as does the Corporate Securities Act. (Bus. & Prof. Code, §§ 10130-10221.) The court overlooked entirely the 1929 amendment to the Real Estate Brokers’ Act which broadened the definition of a real estate broker to include one who does a single act for a compensation of “listing or soliciting prospective purchasers.” (Stats. 1929, ch. 130, § 2; Bus. & Prof. Code, § 10134.)
I am also of the opinion that the purchase by Lehman Brothers was not effected through the efforts of either Lee or Smith, Barney and Company. I agree that Troutman was not an indispensable or necessary party; that the contract was several: that there was no prejudicial error in refusin'? to permit Jergins to examine Troutman under section 2055 of the Code of Civil Procedure: that defendants’ promise was not to answer for the debt, default, or miscarriage of another; *566that it was error not to mark the Troutman letters for identification, but that defendants suffered no substantial prejudice in not being able to use them; that the newly discovered evidence did not compel the granting of a new trial; and that the findings are a hodgepodge.
A petition for a rehearing was denied June 14, 1954, and appellants’ petition for a hearing by the Supreme Court was denied July 21, 1954. Traynor, J., and Spence, J., were of the opinion that the petition should be granted.