Court Opinion

ID: 3711441
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:46:05.998479+00
Date Added: 2024-06-11T15:44:16.639378
License: Public Domain

I respectfully dissent from the majority's decision, because I believe it was an error of law to grant judgment in Ritchie's favor.
I agree with the majority that the assignment from Grubb  Ellis to Ritchie is a valid assignment. However, this assignment does not give Ritchie the right to bring a cause of action which is specifically prohibited by statute.
R.C. 4735.21, in pertinent part, provides:
    No real estate salesman or foreign real estate salesman shall collect any money in connection with any real estate or foreign real estate brokerage transaction, whether as a commission, deposit, payment, rental, or otherwise, except in the name of and with the consent of the licensed real estate broker or licensed foreign real estate dealer under whom he is licensed. Nor shall any real estate salesman * * * commence or maintain any action for a commission or other compensation in connection with a real estate or foreign real estate brokerage transaction, against any person except a person licensed as a real estate broker or foreign real estate dealer under whom he is licensed as a salesman at the time the cause of action arose. (Emphasis added.)
In order to maintain an action for fees for negotiating the lease of real estate under R.C. 4735.21, Ritchie is required to plead and prove that either he was a licensed real estate broker at the time of the transaction, or that he is bringing the action as a real estate salesman with the consent and in the name of a licensed real estate broker. See R.C. 4735.21; see, also, Rispo Realty v. Wisniewski (1962), 90 Ohio Law Abs. 535; DeMetre v. Savas *Page 183 
(1953), 93 Ohio App. 367, 113 N.E.2d 902; DeLorean v. Emprise Corporation (Mar. 8, 1979), Cuyahoga App. No. 38118, unreported.
Although Ritchie stated at trial that he was not a licensed real estate broker, the question at hand is whether Ritchie can stand in the shoes of Grubb  Ellis, a licensed broker, based on the assignment of the right to commissions from the Weston lease.
R.C. 4735.21 specifically prohibits a real estate salesman from bringing the type of action at issue. Presumably, the assignment in question was made for the purpose of circumventing R.C. 4735.21. Therefore, Ritchie, even as an assignee, does not hold the same right to bring the cause of action as Grubb  Ellis. S.D. Stanson, Inc. v. McDonald (1946), 147 Ohio St. 191, 197, 70 N.E.2d 359.
Although the majority factually distinguishes Stanson from the case at hand, the rule of law set forth by the Ohio Supreme Court in Stanson is relevant and controlling. Stanson dealt with a corporation without a broker's license which sued a former employee for commissions. In applying section 6373-48 of the General Code, the predecessor to R.C.4735.21, the court held that where the General Assembly has denied a right of action to recover compensation in certain cases a court may not, in disregard of such legislation, afford relief upon the theory of money had and received. Stanson, 147 Ohio St. 191, at paragraph four of syllabus. This court embellished the Supreme Court's ruling by stating that this same principle precludes an action in assumpsit and every other method which may be employed outside of but contrary to the plain provisions of the statute. DeMetre v. Savas (1953), 93 Ohio App. 367,376, 113 N.E.2d 902. (Emphasis added.)
In the instant case, the method employed by Ritchie to circumvent the plain provisions of R.C. 4735.21 was an assignment. Ritchie has attempted to have a right to a cause of action assigned to him when such right has been specifically prohibited by statute. Regardless of the method chosen, an attempt to bring an action under a method which is clearly contrary to the plain provisions of R.C. 4735.21 is unlawful. To hold otherwise is contrary to the precedent set forth above.
Furthermore, even if Ritchie was permitted to bring this action as an assignee, Ritchie did not, as the majority contends, validly plead his right to prosecute this action by way of assignment. The February 1, 1998 assignment agreement was neither referenced in the complaint nor was it attached thereto.
Thus, because Ritchie is not a licensed broker, he has failed to prove an essential element of his case, and he is therefore precluded from bringing suit to collect the commission from the lease of the property. See R.C. 4735.21; Loss *Page 184 
Realty Group v. Verbon (Dec. 6, 1996), Lucas App. No. L-96-024, unreported.
Since Ritchie is barred from bringing a cause of action as a broker, and his testimony established that he was a real estate salesman at the time of the transaction, it must be determined whether he took the steps necessary to maintain a cause of action against Weston in the capacity of a salesman. Because Ritchie was a real estate salesman acting as an agent of Grubb  Ellis, he is barred from bringing an action against Weston unless the action was brought in the name of a licensed real estate broker. See R.C. 4735.21; Kapel v. Carnegie Mgmt.  Dev. Corp. (May 11, 1995), Cuyahoga App. No. 67939, unreported; Hanes v. Davis (1992),62 Ohio Misc.2d 468, 472, 601 N.E.2d 685.
Ritchie did not have standing to bring this suit in his own name. The fact that Grubb  Ellis, a licensed broker, assigned its right to the lease commissions is insufficient for the purpose of demonstrating that Ritchie is entitled to bring suit in his own name under a breach of contract theory. At best, the assignment agreement serves as evidence that Ritchie had the consent of Grubb  Ellis to collect the unpaid commissions. However, by bringing the action solely in his own name, Ritchie failed to comply with R.C. 4735.21, which requires that the collection action be brought in the name of the licensed real estate broker.
The question is not whether Weston owes the commission, but is rather whether Ritchie complied with R.C. 4735.21 in order to maintain a cause of action to collect the commission. See, Loss Realty Group. Here, in order to maintain a cause of action, Ritchie was required to bring this action in the name of Grubb  Ellis. The evidence suggests that he could not do so because the assignment and indemnity agreement states that it was entered into because of Ritchie's and Grubb  Ellis' different views regarding the collection of unpaid commissions from Weston. Further, Ritchie testified that Grubb  Ellis assigned the rights to the commissions as a business decision, and that Grubb  Ellis is traditionally extremely adverse to filing suits against its clients because of the cost of litigation and the cost to business relationships. Specifically, Ritchie testified that Grubb  Ellis did not want to pursue a claim against Weston because of the large amount of business that Grubb  Ellis does with Weston.
Thus, Ritchie filed this action against Weston in his name alone. As stated above, Grubb  Ellis was not named in this suit, nor was the February 1, 1998 assignment agreement attached to the complaint.
Accordingly, because Ritchie was not a licensed real estate broker at the time of the transaction, and because as a salesman he failed to comply with R.C. 4735.21 in bringing this action, involuntary dismissal under Civ.R. 41(B)(2) was appropriate. Although the trial court had discretion in dismissing the matter, by *Page 185 
denying the motion for dismissal, the lower court erred as a matter of law, and that decision was against the manifest weight of the evidence. Thus, I would reverse the trial court's decision, and dismiss the matter.