97 F. 167 | 6th Cir. | 1899
having made the foregoing statement of facts, delivered the opinion of the court.
The agreement between Rees and Pellow, evidenced by the letter of August 5, 1898, has a double aspect, and must be construed accordingly: First, it was an option to join Mitchell, and sell to Pellow at a fixed price; second, this option was coupled with an agency to sell, in conjunction with Mitchell, to others at the same price.
So far as it was an option to Pellow himself, it was revocable at any time before acceptance. Stitt v. Huidekopers, 17 Wall. 384-394. There is no pretense that Pellow ever accepted the offer, or even had any purpose to do so. This aspect of the case may, therefore, be dismissed.
' We come to the proposition as one of agency. There was no consideration for this agency, and no limit upon its duration. It was, therefore, subject to be terminated in good faith at the will of the principal; otherwise, there would be no means of relieving the principal from an authority exercised under it at any length of time after it was made, no matter what the change of circumstances. Stitt v. Huidekopers, supra; Story, Ag. § 403; Hale v. Kumler, 54 U. S. App. 685-695, 29 C. C. A. 67, and 85 Fed. 161. In Sibbald v. Iron Co., 83 N. Y. 378-384, the rule as to revocation is very admirably stated as follows:
“Where no time for the continuance of the contract is fixed by its terms, either party is at liberty to terminate it at will, subject only to the ordinary requirements of good faith. Usually the broker is entitled to a fair and reasonable opportunity to perform his obligation, subject, of course, to the right of the seller to sell independently. But, that having been granted him, the right of the principal to terminate his authority is absolute and unrestricted, except only that he may not do it in bad faith, and as a mere device to escape the payment of the broker’s commissions.”
So far as this option was coupled with an agency, it was terminated by Rees’ letter of November 6, 1896, expressly revoking it. That revocation, as between principal and agent, took effect from the time when it was delivered in due course of mail at the usual place of business and address of the agent. The letter was addressed to Negaunee, the residence of Pellow, and was duly received at his office, where it lay unopened until his return, November 28, 1896, from a trip to Canada. Rees was unadvised of any change in his address, or of his absence from his residence, and in good faith addressed and mailed his letter of revocation to his only known and usual address. If Pellow neglected to notify Rees of his absence and changed address, or to malee any arrangement to have his mail forwarded, he cannot escape the consequences of his own fault. Undoubtedly, the general rule is that a revocation only takes effect, as between principal and agent, when it is made known to him. But we are of opinion that, under the facts of this case, he received constructive notice that his agency had terminated. The case is not embarrassed by any acts or conduct of Pellow done in furtherance of his agency between the date when he ought to have received this letter in due course of mail and his actual knowledge of revocation, November 28, 1896. In that interval he did nothing under his authority, and no third person acquired any rights, in ignorance of the revocation. The sale subse
The duty which a broker employed to make a sale assumes is that of bringing the minds of the buyer and the seller together for a sale. This includes the price and the terms of sale. When this has been done he has earned his commission, for his contract has been performed. McGavock v. Woodlief, 20 How. 221; Kock v. Emmerling, 22 How. 69. There is no possible doubt, upon the evidence in this case, that Pellow never did bring the buyers and sellers to an agreement. They were utterly unable to agree upon the terms of the sale, though not differing as to the price. This was the indisputable condition of the matter when the Cleveland conferences ended, and this was the equally indisputable situation on the 6th day of November, when his authority was revoked, although negotiations had been resumed by Bees between those dates. The efforts of Pellow had been unsuccessful. He had been unable to procure a purchaser upon terms acceptable to himself and to both the buyer and seller. Down to the date of the revocation the seller was at liberty to advance the price upon Corrigan, McKinney & Co., for the latter had not accepted
For much the same considerations we think it was error to submit the question to the jury as to the reasonable value of Fellow’s services. The agreement of August 5, 1896, was not the ordinary brokerage contract between principal and agent. It was an option for a sale, in conjunction with Mitchell, to Pellow himself, or to one designated by him, at a fixed price. Fellow’s compensation depended upon his making a sale at something in excess of the fixed price stipulated in the option. Xo matter .how valuable his services, he expressly stipulated that fiis compensation should depend entirely upon a sale, while the option was in force, for a price in excess of two dollars per share. He made no such sale before the revocation, and there was no evidence, as we have already seen, of a sufficiently substantial character to require that the court should submit to the jury the question as to whether Rees acted in good faith in revoking his authority on the 6th of November. Unless there was evidence which would have reasonably justified, a jury in finding that, when the authority was revoked, a negotiation instituted by Pellow was plainly and obviously approaching success, and that Rees, with a knowledge of this, revoked his authority for the purpose of concluding the sale without his assistance, and of avoiding the payment to him of the price obtained in excess of the price fixed in the option agreement, there was no case for the jury at all. H the revocation was in bad faith, it might well be said that the due performance of his obligation was prevented for the purpose of concluding the sale himself, and saving the stipulated compensation. In this event the principal would not be porral ¡ted to rely upon the defense that the broker had not performed his contract, in order to defeat a recovery of the stipulated commissions. But if, on the other hand, Rees acted in good faith, not intending to escape the payment of commissions, but moved only by the changed circumstances, and in Ms own interest, and while the negotiations were unsuccessful or inconclusive, he had the absolute right to terminate the option. After such a revocation he was at perfect liberty to resume or continue efforts to sell to a customer who had been unsuccessfully approached by Fellow, even though he, to some extent, availed himself of the former unsuccessful labors of Pellow. The case of Sibbald v. Iron Co., 83 N. Y. 378-384, and the case of Wylie v. Bank, 61 N. Y. 415, are well-considered cases supporting the view we have expressed, and meet our approval. The case of Stitt v. Huidekopers, 17 Wall. 384, is also much in point in its facts, and lends support to the conclusion we reach as to the right of revocation in good faith of an option much like that here considered. It is true that that case did not involve the question presented here by the count upon a quantum meruit, and turned alone upon the count for commissions under the contract. But our view is that,
The court erred in submitting to the jury the question of the reasonable value of the services of the defendant, and in the terms of the charge heretofore set out, and in refusing to charge, as requested, that there could he no recovery, upon the facts of the case, under the quantum meruit count of the declaration. The judgment must be reversed, and a new trial awarded.