*1 15,501. No. Company et al. Investment v. Ross
Wilson 226) P. (180 [2d] April 14, 1947. Decided *2 Mr. N. F. E. Dickerson, Mr. Mr. Horace Hawkins, plaintiff A. F. for in error. Zarlengo, Mr. Harold Messrs. D. Blood Laws, & Tor- Bancroft, gan, for defendants in error.
En Banc. Justice Jackson delivered the of the opinion
court. case
This involves commission for the sale of real We estate. will refer to the parties as they appeared the trial court, where in error plaintiff defendant, and defendants in error were plaintiffs. plaintiffs,
The two real-estate firms, as recovered judgment against jury defendant in a trial to a $7,575 amount of as real-estate commission on a transfer from defendant United States Government of City acres, more less, or of land west of the County immediately being upon Denver. This site, taken over government, became the location plant an ordnance of the war. duration ordinary The case differs from the suit for broker’s agent’s in a sale commission, before had been government brought summated the federal condemna- respect acreage portion tion previously optioned, landowner, had been conducting negotiations personally after the with officials of year finally half, for about a and a per to settle in condemnation suit less originally acre the amount for which she had than agreed to sell. The amount of commission awarded per represented plaintiffs, five cent of $7,575, $151,500, govern- federal received from the the amount defendant proceedings. under the ment settlement recovery sought original complaint, plaintiffs In their per- services quantum of their for the value meruit amend- In an of the defendant. at the instance formed cause they complaint the alternative added ment to express real- recovery of a contract of action for purchaser procuring for defend- commission estate ant’s submitted property. the case Just before plaintiffs were upon jury, defendant, motion causes upon two required of their elect quan- They elected to stand stand. would meruit. tum Cyrus Hackstaff, showed that A. evidence a meet- Co., Ross Investment was called to
Frederick R. ing evening Hotel on the of Decem- at Brown Palace large quite a number at which of officials— 12, 1940, ber *3 including army others, and J. L. men, railroad officers, de of E. I. duPont real division of the estate Warner present. Company “I testified, He Nemours & —were map I could not be told that and told that shown a was try purpose evening purpose I was to what the —what map procure which set out I shown a for, a but was site they thought acres that hundred about fourteen option might night by an to obtain I instructed need. was Hotel.” He was Palace men the Brown at have to remuneration would or his commission told that any possible pur- and not be from the Thereupon option. he might exercise who chasers got Conway-Bogue Conway, in touch with sign Company, sale” Realty had a “for who Investment property, and the of them imme- two defendant’s on resulting diately son, her defendant and interviewed option defendant, an under date of execution of running covering to J. L. 1940, Warner 13, December $175,000. land for acres of subsequently option cancelled, and a new was This signed by 1940, was defendant 16, December one, dated giving assigns, option buy Warner, J. L. or his an option “3068 acres more or less.” This second contained provision that it “shall include 75 inches water Agricultural Company, Ditch and Reservoir and 135 inches of water the Welch ditch. All mineral and oil rights option price $207,450. be included.” The was By permitted its terms Warner and his associates were go making purpose surveys the land for the acceptance required tests, and water was on or February 1, before 1941. This also contained describing separate parcels nine schedule of land con- taining acreage 1,648 in all acres of the total of 3,068 The schedule acres. showed the number of acres in each parcel, separate per placed and a valuation acre on parcel, each valuation, as well as a total dollar and con- provision survey tained a “After that, land above portions described reveals that are not certain thereof required by assigns option, J. L. Warner his or his at may all following parcels of land described dropped be from the terms of the total designated consideration reduced hereinbefore shall be opposite the sum of the amounts hereunder set forth respective parcels required, and con- terms other ditions to remain the same.” option,
A printed third executed on of The form Company, Frederick R. Ross Investment executed by 1940, landowner under 20, date of December whereby convey company she to sell and to that approximately 1, or before March 68 acres addi- option. op- land, tional not included in the second This *4 Agricultural tion included 45 inches of Ditch and Reservoir in water the Company. option price The was paid giving $27,200, less the down the of same. $100 option agreement pay In the there was recited an to five per making cent commission the 21, sale. December assigned option excepting 1490,this was to J. L. Warner, commission.
253 January option, considera- in 16, 1941, A fourth dated assigns, granted or his Warner, of J. L. tion $100, purchase right 160 an additional 1, March 1941, until Agricul- together in the water acres, with 110 inches of Company, the sum of tural Ditch and Reservoir option, the second $44,000. This also extended and contains the follow- 1, 1941, Exhibit ing March A, until specifically understood and “It is condition: the minimum cannot be exercised unless options previ- requirements those under the terms of Hayden ously given by exercised, Okie are St. Claire * * * 1940 16, December of which dated one * * 20, dated December other February under directions from 16, 1941, contractors, government, possession defend- went into the federal days February property. Ten condemna- later, ant’s proceedings were instituted in Federal District tion in The Denver United States Government. Court property did taken under acreage, rights, either in amount of water not conform respect price, requirements the minimum with options principal deviation be- described —the proceedings, although ing the condemnation includ- ing did condemned, site on land not in- a reservoir rights, and neither the land in a the water was clude property section included condemned. certain testimony Conway Hackstaff Messrs. both were instrumental inter- the effect that went to property esting government de- the federal considering government fendant; other Littleton which had the advan- sites, such as one near tage propinquity Golden, nearer railroad, another through their efforts Denver, east of but that and third finally directed to- interest of of a small- for the location defendant’s ward gentlemen any knowledge plant. Both disclaimed arms bringing plans leading of condemnation although he proceedings, Hackstaff testified that *5 February government been informed in that assembling interested in for condemnation. lands occupied When land was first under condem- proceedings, son, nation Her defendant was Florida. attorney on his own accord, consulted a Denver and had a conference which, with him and Hackstaff in they urged testified, latter him to assist de- continue to proceedings. fendant Plaintiffs at about this time a slid- offered to work defendant ing up beginning proceeding scale, per at cent and three twenty per depending upon the amount cent, rate ultimately defendant should receive rejected subsequently demnation suit. this Defendant already year offer, and, as a half of noted, after a negotiations, government settled with on the terms already stated. Defendant claims that the its condemnation the cream and “took property. although left the scum” of mini- Plaintiffs, mizing expression exaggeration, as an not claim do they option fulfilled or all of the contracts. testimony
Mr. Hackstaff’s covered details sur- the option rounding the execution of the four contracts signed by the landowner and described his endeavors to convince sell the landowner that would be she able prices; unless she reduced her how option to cancel the first at the time of the executing second; execution of the how, after the second option, following morning the landowner called him the sleep him night, and told she had not been able to all thought signed she she too at low a price, thought change price and that she she should higher persuaded one; to a that after a conference he her to stand allow as written. He told of her being sell, desire motivated and at the same time get good price property. for her He identified a let- he ter received Mr. J. L. Warner, date January and after he had 24, 1941, obtained the four following paragraphs of options landowner, from the which were admitted evidence: my personal dol- hundred check for one “Enclosed *6 Wilmington Company, reimburse- as Trust lars, #5973, Hayden option payment Mrs. ment for made to one-half of on the west Section #10. sincerely appreciate your cooperation and wish “We you very capable in which commend manner to you securing proposed options for the handled the price plant of ammunition at Denver. We consider for our excellent the land reasonable purpose. site cooperation very pleased “We were also with the Hayden gave you express Mrs. us and wish which appreciation our to her.” testimony Mr. Hackstaff’s
There is no indication from property under her to sell any arrangement in the writ- than that contained other options her he had obtained from over ten negotiations. Conway, period of in his testi- month’s agree- mony, no admitted that the landowner had made in the four written ments other than those contained great emphasis options. in his on the fact that He laid great majority experience closed of deals that were options taken not closed on the after had been were original options, subsequently basis of the but were “negotiated,” meaning there were modifications original options. view, of In terms his proceedings the condemnation modifications brought original options from the terms of the about might to modifications that the transaction. And counsel for the occur were similar any negotiation of final brokers state the position succinctly arguing when,
their point as to whether the brokers had rendered serv- entitling they say them a commission, ices that “con- performance.” pos- At time demnation was was the sibility condemnation mentioned landowner. Conway Messrs. Hackstaff and fact, both disclaimed In any knowledge condemnation until parties, the matter became known to all of the when contractors moved onto the land. presents issue of case, therefore,
This a clear-cut govern- unexpected whether the property, the sub- ment some of which had been ject negotiation brokers and landowner between alleged government, operates as sale to the as a sale so to entitle the the land so brokers to a commission when acreage price taken in condemnation varies in both provisions previ- from the contracts written ously executed the landowner at the instance of question brokers. Plaintiffs this in the affirma- answer speci- tive. On the hand, other one of the landowner’s points fication of is, that condemnation is not a sale— proceedings operated prevent that the condemnation contemplated by the sale that was *7 suit.
Under the federal statutes decisions, and a distinction appears purchase to be made between and condemna- Strong, tion. As Mr. Justice States, Kohl v. United pur- 91 367, 374, U.S. said: is true, “It the words ‘to might including chase’ power be construed as acquire technically, purchase condemnation; for, in- acquisition cludes all modes of other than that de- of generally, scent. But in statutes as in use, common employed only word is in a sense technical, as mean- ing acquisition by governmental parties, contract between the without Congress
interference. That intended more than this is evident, however, in view of the sub- sequent amendatory passed act June 10, 1872,which appropriation purchase private made an ‘for the at sale ground or condemnation of for a site’ for the building.” City In Garrison v. New 21 York, 88 U.S. Wallace, of
196, 203, the court had under consideration a New York relating state involving act to condemnation widening Broadway straightening of in New objection City. been raised had York The constitutional obligation con- impairment of that there was an Speak- §10. I, Art. Constitution, the federal tract under ing point, therefore, is, “There the court said: to this justly presented contended it can be case may impaired. be doubted It a contract has been agreement, upon judgment an not founded whether a meaning express implied, within the or is a contract * * * per- prohibition. But it is not the constitutional pro- convert the result of a ceived how this fiction can ceeding, agreement express upon im- or not founded wanting plied a transaction the assent but parties, meaning into a contract within the of the clause any legislation of the Federal Constitution which forbids * * * impairing obligation. proceeding In its property plaintiff public street, condemn the for a nothing there in the nature of a contract between city. right him state, in virtue of her city eminent his domain, authorized the to take property public purpose, upon making just for a to him compensation.”
On the other hand “a sale” means “a contract give pass rights and to between money buyer pays promises pay or which the thing bought seller sold.” C.J. 36. during passed emergency,
The federal law the war recognizes U.S.C.A., Title 50 section likewise a dis- purchase tinction between condemnation and it when specifies acquiring namely: three methods of title, purchase demnation, and donation. *8 apparent to this distinction in Ha contradiction (9th C.C.A.),
waiian Products v. Commissioner 126 Gas (2d) largely dispelled F. when it is realized that 4, tax that a case under federal income law involv was the. ing gain resulting capital from condemnation. We do changed case has basic believe that that proceeding a condemnation and a differencebetween sale. merely taxing purpose The court holds that a 258 or loss, received
capital gain compensation prop- erty under establishes taken either for tax same purposes a loss gain way sale. from a as would proceeds Another case in held word “sale” was Seibert, Tiffany Studios v. include 166 condemnation is N.Y.S. 304. This which pro- involved will interpreting vided that certain should shares heirs receive stipulated sale of real estate. Some land in the upon estate was taken believe that by condemnation, and we facts in that case the court inter- properly word preted the “sale” to include condemnation. Tyler Seiler, v. In 136 394, 395, N.Y.S. com mission was allowed in a condemnation but proceeding, nevertheless the author of the court’s opinion expresses our views instant case:
“The court is of the that opinion it was that proven was plaintiff employed by defendants; that plaintiff found a able and party willing purchase 29 premises, Street, Whipple $9,000, procured that party make the that it is purchase; fairly infer- able that the sole of the condemnation purpose proceed- to clear a ings title; defect the property by the for a acquired city sum in excess of the amount stipulated; defendants received the purchase money.
“Whether earned his plaintiff commission depends alone whether upon the minds of the met upon for the sale and agreement whether the broker had been the procuring cause. Tanenbaum v. Boehm, 202 Davidson 299, 95 Stocky, v. 293, 708; N.Y. N.E. 202 N.Y. Smith v. 423, 753; N.E. 424, 95 Peyrot, N.Y. 662. N.E.
[*] [*] [*] “It is not presumed public officers, be charged land, duty of would resort acquiring with the imposing greater cost proceedings, demnation
259 necessary municipality, course made the not were good public reason.” for some using proceedings aas of condemnation
This method clearing a meet- there has been title, of after means ing purchase and sale has and a of minds contract appears upon, to be followed federal also been practice very recent case of
as noted from can be Sup. 606, L. Ed. 67 Ct. States, Albrecht v. United 91 155), (Nos. 151 and 148, 149, 150, U. S. Law Week February That case a contract 3, 1947. involved decided purchase certain individuals and the and sale between reported America, and we find United States of “The first contract condition as decision the statement: upon conveyance payment that it should be made good of a merchantable title. The second was that and Attorney approve not if ‘for reason’ the General did good title, could obtain a title the Government appropriate in an condemnation district agreed compensation court, in event was to deposited in court.” be case
Unlike the instant shows contract case, agreed compensa- purchaser seller for an between compensation in the instant case been tion. agreement, by previous fixed property nor had the amount of the agreed upon. of these taken been Both factors in the condemnation suit itself. The determined were Tyler supra, question propounded Seiler, test v. upon agree- an whether the minds met been ment for the sale and whether broker had negative. procuring must be answered in the In cause, meeting instant there was no of the minds case agreement procured options the brokers sale, alleged purchaser rather purchaser the landowner. than say gov- By that the federal not mean to dowe purchaser. As we not have have could been ernment emergency very statute which this war seen, brought contemplated proceeding was also acquiring necessary property by and authorized the purchase. meeting There could have been that *10 necessary every minds is contract. There was none in this case. The basic nature of this distinction can be further realized when isit noted that a on a suit personam, appropriation contract pri- is one in but an public generally vate for a use is viewed as a proceeding p. §112. rem. 18 Am. Jur., 738,
Counsel for the landowner also cite the Colorado stat- ute re real chapter estate brokers, ’35 C.S.A., 15, section applicable 25, as case, this and show that an instruc- tion was tendered in the words of the statute and re- by pass fused the alleged trial court. We over this error because we believe that Instruction No. 2, which was given, wrong points up principal the issue in this case. This instruction read as follows: you
“You pre- are instructed that if believe from a ponderance plaintiffs of the evidence herein that at request performed of the defendant services for her as agents, you real estate brokers and then are to return a plaintiffs against verdict for the such sum as defendant you believe that the said services were rea- sonably worth, but not exceed $7575.00. you by
“On preponderance the other hand, if find a plaintiffs agents evidence that the as real estate at request of the defendant rendered no services for you her as such, then should return a verdict defendant.”
It will be noted that this instruction re allows covery quantum entirely, on services meruit basis regardless any express general contract. The rule implied that, “There can be contract where there is express parties contract between the in reference to subject p. the same matter.” 13 C.J., 243, §9; also, see, §5. apply Contracts, 17 C.J.S. This rule does not where implied agreement subsequent is based on the con parties by express duct of the not covered contract. O’Byrne (2d) Lawson, v. Colo. 134 P. 199. But
.261 pro- that condemnation in this case the evidence shows ceedings litiga- were instituted while dealing express contracts, tion were under the only possible contract other evidence place the land- took between conversation lawyer’s after office, son and the brokers in the owner’s prop- in on contractors had moved erty. any possible But could render the services point pertain to could earn- landowner from that ing procuring purchaser, but ex- as commission perts help price in the con- on land values to boost the proceedings. subsequently demnation This the brokers rejected land- offered to and their offer was do, owner. express therefore, that conclude,
We performed the condemnation been tracts have not *11 exercising government, proceedings, its for the federal right in moved landowner’s domain, of eminent property moun- like a sudden avalanche and, sought occupied to take —with- above, land it tains what warning important details out the owner. Two most unceremoniously every purchase in and are thus sale nego- completely field of removed from the owner’s property time i.e., tiation, what should be sold govern- given. possession when The federal should be regardless takes over desires, of the ment, landowner’s relentlessly property moves in on it wishes and what without it consulting the owner. detail, i.e., limited in a third
The is further owner bargain- price. power ing negotiate usual as to the In the purchaser, posi- the seller is a between seller convey purchaser if the does not have to tion where he proceeding, terms; in a condemnation not meet his does property power to withhold the the owner has lost negotiation any portion his is it; field of narrowed or reaching (1) an accord in re- choices, down to two property spect compensation condemned, contesting (2) court the case in court. The owner only
whether he alternatives not, wants to be or and his litigate. power are to settle or He his to settle has tost advantageously he a all times because at time when of possession, right possession, his should have or the irrevocably he has tost it. proceed- defendant, The fact that in the condemnation ings, signed receiving fair statement she was premises indicating value for the taken, that she price, judgment satisfied with the does alter our signing obligatory. the situation. The have We suggest recovery found no case that would aof commis- sion under the facts of the instant case.
We believe result we have reached is in ac- cord good questioning with the rule, better for, without
faith particu- involved in this lar practice case, it can be noted that as matter of protect by disclosing real-estate broker can himself principal possibility his of condemnation contingency and cover this in his contract for commis- Only very wary pro- sion. bewill able to receiving tect himself from a broker after who, informa- impending tion as to proceedings, may insert himself between the landowner and the demnor. judgment is reversed. Hays
Mr. Justice dissents. Stone and Mr. Justice Luxford do not Justice participate. *12 Hays Justice dissenting. majority opinion I from the dissent for the reason that my predicated, opinion, upon it is in a cause of in action complaint upon which has been abandoned, and not upon jury. the one which the case was submitted to the complaint: There were two causes of action in the one upon upon quantum contract based and the other plaintiffs, evidence, meruit. At the close of all upon pursuant stand court, elected to order thereby quantum based the cause and abandoned meruit, upon contract. majority opinion case,
In the states: “This the author presents un- issue of whether therefore, clear-cut government expected of some of negotiation subject property, had been the alleged sale to the brokers and landowner for between government, operates the brok- as a sale so as to entitle in con- ers to a the land so taken commission when acreage price in from the demnation varies both and previously provisions exe- contracts written by the at the instance of the brokers.” cuted agree I am unable to with the above statement my wholly view issues of case. It is immaterial * * * oper- whether “condemnation condemna- ates as a sale” or “the land so taken in acreage provisions price from the tion varies both and only issue of the written contracts.” The sole plaintiffs rendered in the case is whether or not the agents at her services as brokers and request, to the defendant I think and if of such services. so, value given by court, is a correct Instruction No. the trial It reads as statement of the issues the case. follows: request “Plaintiffs claim that at the of the defendant they performed for her as real estate brokers services agents all of $7575.00, sum of which were worth the paid. which has not been plaintiffs employed
“Defendant denies that she request; rendered for her at her services anything. and also further denies that she owes them you are to deter- “These the issues are called mine.” jury:
The trial court further instructed you pre- if believe from a are instructed that “You plaintiffs ponderance herein that at the of the evidence performed request services for her as real defendant *13 you agents, return a ver- estate then are to brokers and plaintiffs against sum as dict in such defendant you reasonably believe the said services were worth, but not to exceed $7575.00. you preponderance
“On the hand, other if find agents plaintiffs of the evidence that the as real estate request at the of the defendant rendered no services for you her such, as then should a verdict for the return defendant.” majority opinion the above does not conform to theory upon which the case issues,
statement contrary I assumes, the author as was interpret on the tried, but opinion, the case was tried complaint. interpre- This cause of action of contract following excerpts further fortified tation is opinion: case involves a commission sale of real “This estate.” “* * * Plaintiffs do not claim that fulfilled or all contracts.” testimony “There is no indication from Mr. Hackstaff s property to sell her any arrangement other than that contained writ- options, ten which he had obtained from her over a period negotiations.” month’s Conway testimony, “Mr. in his admitted that the land- agreements owner had made no other than those con- options.” tained in the four written pur- “The instant case shows no contract between agreed compensation.” chaser and seller for an pur- “The instant case shows contract between a agreed compensation. chaser and seller for an The com- pensation by pre- in the instant case not been fixed agreement, vious nor had the amount of the agreed upon. Both of these taken been factors were determined in the condemnation suit itself.”
“By say gov- mean to this we do not that the federal purchaser.” could have been a ernment meeting minds been that could have “There *14 * * * A every suit necessary contract. in pri- appropriation of personam, but contract is one generally as a public viewed property use is for a vate proceeding rem.” express therefore, that conclude, “We performed been tracts have not
proceedings.” majority excerpts my judgment from the above
In quan- wholly an action on opinion with inconsistent are cause abandoned with the are consistent tum but meruit, accepted the The defendant contract. action on a apparently day day plaintiffs of the services doing in an were what satisfied with was well her select effort to have discharged plant. she reached them when She the arms negotiations serv- that their point she felt where longer circumstances such needed. “Under ices were part implies promise on the held the law have we employee pay employer the reasonable light of conferred.” benefits of his services value (2d) 178 P. 417. Ruthven, 116 Colo. v. Milner properly my opinion court instructed trial In jury, quantum meruit, and verdict jury on should be evidence, abundant is based affirmed.