123 P. 949 | Mont. | 1912
Lead Opinion
delivered .the opinion of tbe court.
Plaintiffs are copartners, doing business as real estate brokers at Lewistown, Montana. In this action, they seek to recover the sum of $5,000, alleged to be due them for their services to defendant in procuring a purchaser of 450 shares of the capital stock of the Lewistown Brewing Company and of certain real estate situated near Lewistown, in Fergus county, all the property of the defendant. The trial resulted in a judgment for the plaintiffs. The defendant has appealed from the judgment and an order denying him a new trial.
There is serious question whether the issue made by plaintiffs’ reply to defendant’s answer does not present substantial departure from the cause of action alleged in the complaint; but, under the view we have taken of the merits of the ease as disclosed by the evidence, we deem it unnecessary to give special notice to this feature of the case. In our opinion, the evidence is insufficient to show a liability on the part of the defendant.
It appears that on November 4, 1910, the defendant gave to the plaintiffs, in writing, an exclusive agency to sell the stock, which constituted a controlling interest in the brewing company, for a period of thirty days, with a right of extension for thirty days’ additional time in case a sale had not been effected, but with the proviso that after the expiration of the first period of thirty days the defendant was to be free to sell to any purchaser found by himself. The minimum price fixed by the agreement was $60,000. Of this plaintiffs were to receive a commission of $5,000. If a sale should be effected at a price in excess of $60,000, the plaintiffs were to receive one-half of the excess, in addition to the commission of $5,000. A sale was not effected during the life of the agreement, though negotiations had been had by plaintiffs with different parties, particularly with one Borgeson, who resides in Butte, and who had visited Lewistown to examine the brewery property in December, 1910, with a view of effecting a purchase of the stock through the agency of plaintiffs. These negotiations failed, because Bor-
On or about April 1, 1911, the plaintiffs, still hoping to effect a deal with Borgeson, solicited from defendant permission to renew their negotiations to that end. Defendant gave his.consent orally, but stipulated that the deal should include, also, seven or eight acres of land belonging to him, and situate adjacent to the brewery property. ■ Defendant fixed his price for the whole property at $70,000. There was no specific agreement as to the amount of commission the plaintiffs were to receive; but the parties understood it was to be $5,000. The defendant told the plaintiffs that he was then negotiating with other parties for a sale of the stock; and that if he could effect a sale in the meantime he would do so. On April 2 plaintiff Hanley induced the defendant to accompany him to Butte to examine the Borgeson property with the hope of gaining his consent to take it. Upon examination of it, defendant expressed himself to both Borgeson and Hanley as willing to take it at $35,000, the price fixed by Borgeson. Borgeson had not theretofore examined the land belonging to the defendant. He stated that he would accept the defendant’s property, both the stock and the land, if, upon examination, he found the brewery in the same condition it was when he had seen it in December, and if the land and the stock were worth the money demanded by defendant. At that time, Borgeson was recovering from an illness, and was unable to go at once to Lewistown with Hanley and defendant. He stated that he would go in a few days. Upon being told by defendant, in Hanley’s presence, that he was negotiating with other persons, and that he intended to let the stock go to the first person with whom he could close a deal, Borgeson told him that, if he could sell in the meantime, to do so. One Hodel, a stockholder in the brewing company, had theretofore offered to buy the defendant’s stock, but had not been able to procure the funds necessary. He was then making an effort to do so. On the evening of April 11, Hanley informed defendant by telephone that Borgeson
It appears from the testimony of Borgeson that his purpose in going to Lewistown was to close the deal with defendant, provided, upon examination of the property, he found it to be as represented to him, and, in his opinion, was worth the money demanded for it. In this connection, he testified: “I had not noticed that ground when I was there in December. I was told that it belonged to Iiogl individually, and he kept that as a home and also rented houses. I felt on that day that I would have been willing to have taken the property under the terms named on the morning when I arrived in Lewistown. No, sir; I would not say I was ready, willing, and able to do it until I had seen it. That is true that that was really the cause of my whole trip from Butte over here. I didn’t know the real estate, or the condition the brewery was in, is why I didn’t close up the deal and buy it. Mr. Hogl told me over at Butte, in the presence of Hanley, that he could not hold it for me; that first come, first served; and Hanley was present when he told me that. I said he should not hold it, in case of losing any sale on account of me; and as soon as I would be able I would come over, and I came of my own accord.”
A broker is entitled to his commission when he shows (1) that
It is clear from the summary of the evidence given above that the plaintiffs did not bring themselves within this rule. It was
It is not of import that the plaintiffs expended time and money
The judgment and order are reversed. The cause is remanded to the district court, with directions to enter judgment for the defendant.
Reversed and remanded.
Rehearing
On Motion for Rehearing.
delivered the opinion of the court.
In their brief in support of a motion for rehearing, counsel contend that, though the defendant had reserved the right to make a sale, the reservation was with reference to the whole property, both the stock and the land; and hence that, while, under the circumstances disclosed by the evidence, the defendant could lawfully have sold it, thereby revoking the authority of plaintiffs and freeing himself from liability to them for a commission, he could not, and did not, accomplish this by effecting a sale of the brewery stock, a part of' it, after the negotiations with Borgeson were approaching completion.
As between the principal and agent, the authority of the agent may be revoked at any time. The relation of principal and agent is a personal one; and if the principal does not care longer
So when an owner employs a broker to obtain a purchaser for his property for a commission, knowing that the effort to find a purchaser and effect a sale will involve the expenditure of time and labor, and the agent does this in good faith, with the result that his efforts are approaching success, the owner cannot with impunity revoke his authority, for the purpose of evading payment of the commission and effect the sale himself. Nor, for the same reason, may he disable himself from carrying out the contract of sale after the broker has found a purchaser who has accepted the offer made by the owner according to its terms. Under such circumstances it may well be said that the owner is under obligation to allow the broker a reasonable time within which to complete the negotiations. On this subject Mr. Meehem in his work on Agency says: “So where an agent is employed to perform an act which involves expenditures of labor and money before it is possible to accomplish the desired object, and after the agent has in good faith incurred expense and expended time and labor, but before he has had a reasonable opportunity to avail himself of the results of this preliminary effort, it could not be permitted that the principal should then terminate the agency and take advantage of the agent’s services without rendering any compensation therefor. Thus, if a broker employed to sell property, had in good faith expended money and labor in advertising and finding a purchaser, and was in the midst of negotiations which were evidently and plainly approaching success, and the seller would revoke the authority, with the purpose of availing himself of the broker’s efforts and avoiding the payment of his
The facts of this case, however, do not bring it within these principles. The evidence clearly discloses that, while the plaintiffs were employed to find a purchaser for both the brewery stock and the land, they understood that the negotiations in which the defendant was engaged pertained exclusively to the brewery stock; and that it was with reference to it only that the reservation was made. Hence the plaintiffs knew that the defendant might at any time effect a sale of the stock only, and thus render abortive their negotiations with Borgeson. Under these circumstances, the defendant was free to sell the stock at any time until Borgeson had definitely accepted the offer made to him.
It is suggested that the defendant acted in bad faith in accepting Hodel’s offer for the stock, after he had been informed that Borgeson was in Lewistown ready to make examination of the property; and that he should be held liable for this reason. As we have seen, he did exactly what he had reserved the right to do. He is therefore not open to the charge of bad faith.
The motion is denied.
Rehearing denied May 31, 1912.