Court Opinion

ID: 9745400
Source: CourtListenerOpinion
Date Created: 2023-08-26 22:53:52.810183+00
Date Added: 2024-06-11T07:25:00.096267
License: Public Domain

SHARPNACK, Judge,
concurring.
I concur in the result reached by the majority, but I cannot concur in their reasoning. The majority holds that Vencel is not entitled to a commission because he did not procure the party who eventually purchased the property. This holding is contrary to the express terms of the listing contract and the governing precedent of this state. However, there is evidence that the sale for which Vencel claims a commission falls outside the express terms of the listing contract.
The listing contract granted Vencel the irrevocable and exclusive right to sell the property from March 4, 1987 through September 4, 1987. The contract further provided that Vencel would be entitled to a commission:
"At the time OWNER sells the Property to a Purchaser procured in whole or in part by the efforts of REALTOR, a cooperating Broker or the OWNER during the term of this Contract."
(Record, p. 287) (emphasis added). Thus, the contract expressly provided that Vencel (the realtor) was entitled to a commission even if the Campbells (the owners) sold the property through their own efforts.
This court has held on more than one occasion that a provision in a listing contract that gives a broker the right to collect a commission regardless of whose efforts procure the buyer is enforceable. Sutton v. Roth, Wehrly, Heiny, Inc. (1981), Ind.App., 418 N.E.2d 229, 233; Brown v. Maris (in Banc 1958), 128 Ind.App. 671, 676-677, 150 N.E.2d 760, 763. In Sutton, the property owner and the broker entered into a listing contract which provided that, if the property in question, a motel, was sold within ninety days of the expiration of the contract to any person with whom the broker, the owner, or their representatives had negotiations during the period of the exclusive listing contract, the broker would be entitled to a commission. An agent of the listing company showed the hotel to three men. This group decided against buying the motel. Some time later, the owner entered into negotiations with one of these men, David Nolan, without the aid of the listing agency. After the listing contract had expired, but before the ninety day extension period had expired, the owner sold the hotel to Nolan and his wife. The list ing agency demanded its commission, and the owner refused.
The listing agency sued for its commission, and the trial court entered judgment in favor of the ageney. On appeal, the owner asserted that the listing agency's damages were limited to the expenses which the agency incurred on behalf of the owner. The third district, through Judge Hoffman, wrote:
"''The contract in the present case however expressly provides for payment to the [broker] even if it is not the cause of the sale. The only prerequisites for collection of the commission are: 1) the 'real estate is sold or exchanged within 90 days after the expiration of the term of this agreement' and 2) the sale is 'to any person, firm or corporation with whom during the exclusive period of this *813listing you, your representatives [the broker] or myself or ourselves [Suttons] had negotiations relative to the purchase of said property for said price stated herein and upon terms acceptable....
* a * * * *
Since the contract in the present case provided for a payment of commission even if the [broker] was not the essential cause of the sale, the commission itself is the proper measure of damages. The trial court committed no error in so instructing the jury."
Sutton, 418 N.E.2d at 233.
In Brown, the appellate court, sitting in bane, superseded its earlier holding that a broker was not entitled to a commission where the listing contract provided that the broker was entitled to a commission if, within ninety days of the expiration of the contract, the owner sold the property to a person to whom the broker had shown the property before the contract terminated. In finding that the broker was entitled to his commission, the court wrote:
"What we have said up to this point has reference to contracts wherein the owner merely gives the broker the exclusive right to sell certain real estate and promises to pay him a stipulated commission for doing so. It must be conceded, however, that two individuals, competent to contract, can make any sort of agreement they choose and if such agreement is supported by a valid consideration and is not contrary to public policy it will be binding on both. Thus it is proper that an owner of real estate and a real estate broker should execute a contract wherein it is expressly stated that the broker will be paid a stipulated commission in the event of a sale within the time specified no matter whether it was effected by the broker or by the principal or by any other person. The validity of such contract was recognized by the Supreme Court of this State in Singleton v. O'Blenis, 1890, 125 Ind. 151, 25 N.E. 154, 156. ...
* * * * * *
The above decision indicates that Indiana, like those states listed in the annotation at 64 ALR. 416, recognizes the rule that the rights of the broker are controlled by the particular language of the contract and if a real estate broker has specifically agreed to pay his broker a commission regardless of the circumstances under which the property involved is sold such a contract is supported by sufficient consideration and is enforceable."
Brown, 128 Ind.App. at 676-677, 150 N.E.2d at 763 (emphasis added).
Sutton and Brown make it clear that a listing contract may grant a broker the right to a commission even if the broker did nothing to contribute to the sale of the property. In this case Vencel would have had an enforceable right to a commission for the sale of the Campbells' property if the sale had fallen within the terms of the commission provisigns of the listing agreement. The evidence establishes that the sale did 'not fall within the terms of the contract, however.
The commission clause states:
"At the time OWNER sells the Property to a Purchaser procured in whole or in part by the efforts of REALTOR, a cooperating Broker or the OWNER during the term of this Contract."
(emphasis added). This language is ambiguous. It can mean that the broker is entitled to a commission for any sale which takes place during the term of the contract or it can mean that the broker is entitled to a commission for any sale procured by the efforts of any party if those efforts occurred during the term of the contract. Vencel would be entitled to a commission under the former interpretation because the evidence shows that the sale took place during the term of the contract. He would not be entitled to a commission under the latter interpretation because there is no evidence that the Campbells engaged in any efforts to sell the property after they entered into the listing contract with Ven-cel; indeed, the evidence shows that they solicited the sale to the eventual buyer before entering the listing contract with Vencel.
*814It has long been the law that ambiguous terms in a contract are to be construed most strongly against the party who prepared or employed the ambiguous words. Smith v. Sparks Milling Co. (1942), 219 Ind. 576, 603, 89 N.E.2d 125, 135. In this case, this rule means that the contract should be construed to mean that Vencel was entitled to a commission only if he, the Campbells, or some other party made efforts to effect a sale during the pendency of the listing contract. Because there is no evidence that anyone made any efforts to solicit the sale during the pendency of the agreement, I believe that the sale falls outside the terms of the commission clause, and I concur with the majority's conclusion that the trial court erred in awarding Ven-cel a commission.
For the reasons stated above, I concur in the result reached by the majority.