Court Opinion

ID: 5888587
Source: CourtListenerOpinion
Date Created: 2022-01-13 02:40:39.578067+00
Date Added: 2024-06-11T08:45:16.011601
License: Public Domain

Fein and Ellerin, JJ.,
dissent in a memorandum by Fein, J., as follows:
I respectfully dissent. In granting summary judgment for the defendant, the majority has assumed certain facts and decided others. This is not the function of summary judgment.
In early 1983, plaintiffs vice-president, Stanley H. Kovak (Kovak), called the Chicago office of the Tribune Company (which controlled the New York Daily News) and asked to speak to the individual in charge of the Daily News garage at 220 East 41st Street in New York City to determine whether the garage site was for sale. Henry Barkhausen (Barkhausen), the director of real estate, told Kovak that the property was to be sold but that the asking price had not yet been determined. Kovak offered the property to Goodstein Construction Corp. (Goodstein), which authorized plaintiff to offer the Tribune Company $9 million for the garage site. Kovak spoke to Barkhausen on the phone about the offer and mentioned that it was subject to plaintiffs commission rates. Barkhausen *637requested that the offer be submitted in writing. On July 5, 1983, Kovak wrote to Barkhausen, submitting the $9 million offer and stating: "Enclosed is the portfolio for the Goodstein Construction Corp. As I mentioned to you they would be interested in acquiring the above captioned site at a price of $9,000,000 all cash. The offer is subject to Julien J. Studley, Inc. receiving a commission of 3% of the sales price.”
Other conversations followed. According to plaintiff, Barkhausen raised no question as to plaintiff’s commission, although Barkhausen now asserts he stated any commission would be added to the asking price. It is plain from the face of that communication that a jury could find that it was expected and recognized that defendant would pay a real estate commission to plaintiff of 3% of the sales price. There is plainly a triable issue of fact as to what was said. There is no writing from defendant supporting Barkhausen’s statement.
Barkhausen discussed the offer with his own people. He did not respond to the letter until he received a valuation from the Tribune’s real estate consultant who valued the property at $13 million. Barkhausen requested a meeting with the prospective purchaser and suggested that the meeting take place at plaintiff’s office in New York City. The meeting took place on July 25, 1983. Present were Barkhausen; Messrs. John Ryan and Mike Reid from Landauer Associates, Inc. (Landauer), the Tribune’s real estate consultant; Steven and Martin Goodstein and Arthur Cohen, the proposed buyers; and Julien J. Studley and Stanley Kovak of the plaintiff brokerage firm.
After a lengthy discussion, Ryan stated that the Tribune would like to make a fast deal and that the asking price was $15 million, all cash and "net”. Plaintiff’s commission was to be added to the $15 million or to be paid directly by the purchasers. This was the first time that the Tribune had suggested that the buyer pay the commission. The Tribune agreed that if Goodstein accepted the proposal, it would agree not to deal with anyone else. Goodstein accepted and the meeting ended with handshakes.
Plaintiff then entered into a written agreement with Good-stein which provided that if and when Goodstein received the garage site, Goodstein would pay plaintiff $300,000. The Tribune Company was not a party to that agreement. The Tribune Company board authorized the sale. However, on the date fixed for contract signing, although Goodstein was prepared to make the requisite down payment, the Tribune Company refused to proceed with the deal. It had agreed to sell to *638another for more money. Goodstein immediately offered to pay the Tribune Company $500,000 more than the other offering, but this was rejected.
Plainly there is a question of fact whether there was an agreement between defendants and the broker that defendants would pay a 3% commission. Defendants argue, and the majority seems to assume, that when Kovak wrote stating that the $9 million offer was "subject to Julien J. Studley, Inc. receiving a commission of 3% of the sales price”, the intention was that the buyer would pay the commission. Although the language is susceptible of that interpretation, it is equally susceptible to the interpretation that the seller was to pay the commission. Moreover, there was no need for this provision if it was understood that the buyer was to pay the commission. Barkhausen’s conversations with Kovak and the meeting at plaintiff’s office at least raise a question as to whether the intention was that if the Tribune accepted the Goodstein offer the Tribune would be responsible for the commission.
The majority makes much of the fact that plaintiff had a prospective purchaser when it approached the Tribune, and the fact that the terms of the deal as finally agreed upon were that the purchaser was to pay the commission. These facts are plainly not dispositive.
Lane — Real Estate Dept. Store v Lawlet Corp. (28 NY2d 36), the leading case on the subject, is to the contrary. There, the jury awarded the plaintiff a verdict. The Second Department reversed and dismissed the complaint (33 AD2d 924). The Court of Appeals reinstated the complaint, stating that the issue of the broker’s employment must be resolved by the jury (28 NY2d, at p 44): "[A]ll a broker need do to establish a prima facie case is introduce evidence tending to show the existence of a commission agreement and that he has procured a ready, willing and able purchaser at the price and terms of the seller. These are all questions of fact and as such must be resolved by the jury.”
Barkhausen, for defendants, was well aware that plaintiff was a real estate broker. He told Kovak that the site would be for sale subject to a determination of a proper price. Kovak’s letter confirming prior conversations indicated that the commission would be 3%. Barkhausen does not deny that this occurred. He disputes who was going to pay the commission. On that basis there is an issue of fact, whether the Tribune agreed to pay a commission to plaintiff. That fact has been assumed or decided by the majority against plaintiff.
*639That is not the function of summary judgment, which is issue finding not issue determination (Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395; City Univ. v Finalco, Inc., 93 AD2d 792). Summary judgment is a drastic remedy and should not be granted where there is any doubt as to the existence of a triable issue (Moskowitz v Garlock, 23 AD2d 943) or where the issue is even arguable (Barrett v Jacobs, 255 NY 520, 522). The fact that plaintiff was first acting for the buyer is not dispositive. As in Lane (supra), prior employment by the buyer is not dispositive on the issue of subsequent employment by the seller. Nor does it discharge the seller’s liability for commissions to the broker (Biskind & Barasch, Real Estate Brokers § 66).
The fact that the transaction ultimately agreed upon required the buyer to pay the commission is not dispositive.
The fact that defendants insisted that plaintiffs commission be paid by the buyer when the deal was closed does not bar plaintiffs right to recover. Obviously, had defendants performed, the buyer would be required to pay the commission. The deal did not close because of defendants’ failure to perform. This plainly does not relieve it of responsibility. The documentary evidence supports plaintiff on the issue before us. Kovak’s letter and Barkhausen’s response would be sufficient to warrant a jury verdict in favor of plaintiff.
Adams & Co. Real Estate v E. & B. Super Mkts. (26 AD2d 365), relied upon by the majority, is not pertinent. In that case an express contract respecting commissions was found to exist from the outset. There is no such contract here. Here there is an issue of fact as to whether defendants agreed to pay the commission if a deal was made. It is undisputed that plaintiff produced a purchaser who was ready, willing and able to close on defendants’ terms. It is equally undisputed that defendants agreed upon the terms and then refused to perform. They cannot now rely upon the provision that plaintiff could recover a commission only from the buyer. Such commission would be payable only if the deal closed.
The fact that the buyer was powerless to enforce the agreement against defendants because of the Statute of Frauds does not relieve defendants of their obligation to pay the broker. Nothing in the cases cited by the majority is to the contrary. In several cases the judgment was after a jury trial, finding in favor of the seller where there was no basis for finding an agreement to pay a commission. On appeal it was emphasized that there was a jury issue (see, Naum v Wiltsie, 271 App Div *640169, which is the source of the majority’s characterization of plaintiff here as a " 'mere volunteer’ ”).
Thus, in Simon v Allied Chem. Corp. (35 AD2d 273, 276, affd 29 NY2d 861), this court held "There is no ambiguity in the documents and plaintiff has failed to establish a contract of employment.” Not so here. The letter from plaintiff to defendants and the testimony of Kovak are sufficient to raise a triable issue.
Benedict v Pell (70 App Div 40), heavily relied on by the majority, is not to the contrary. There was a trial in that case, in which it was developed that there was never any conversation, writing or agreement supporting the plaintiff broker’s claim. Moreover, he had dealt only with one Potterton, an agent of the defendant who was not shown to have any authority to bind the owner. Potterton testified he never discussed commission with the plaintiff and never represented he had authority to bind the owner. Moreover he was named in the contract as the broker entitled to commission. This has nothing to do with our case.
It is well settled that the broker’s right to compensation is not dependent upon performance of the realty contract unless it is expressly so conditioned (Lane — Real Estate Dept. Store v Lawlet Corp., supra).
There is a triable issue as to whether there was an agreement by defendants to pay a commission. It is undisputed that defendants’ acts deprived plaintiff of a commission. The issue should not be tossed off on summary judgment.
The order appealed from should be affirmed, with costs.