Bay Shore Homes, Inc. v. San Diego Trust and Sav. Bank
| Citation | 80 Cal.Rptr. 849,276 Cal.App.2d 108 |
| Court | California Court of Appeals |
| Decision Date | 15 September 1969 |
| Parties | BAY SHORE HOMES, INC., a California corporation, Plaintiff, Respondent and Appellant, v. SAN DIEGO TRUST & SAVINGS BANK, a California corporation, Defendant. SAN DIEGO TRUST & SAVINGS BANK, as Administrator with the Will Annexed of the Estate of Edna C. Brown, Deceased, et al., Cross-complainants and Respondents, v. Stan MAYKUT, Cross-defendant and Appellant. Civ. 8878. |
Bay Shore Homes, Inc., a corporation (Bay Shore) appeals from a judgment awarding damages to San Diego Trust & Savings Bank, a corporation (Bank), as administrator with will annexed of the last will and testament of Edna C. Brown, deceased, and Elizabeth Tyson, Conservator of the Person and Estate of Mildred E. Wuest, Conservatee; Stan Maykut, named as a cross-defendant by Bank, appeals from the judgment which declared he was not entitled to a real estate commission.
On January 27, 1964, an asset of the estate of Edna C. Brown was an undivided one-half interest in a seven-acre tract of unimproved real property at the intersection of Seventieth Street and University Avenue in the City of La Mesa; undivided interests were owned by the heirs and devisee of Richard Wuest, deceased, subject to administration and by Mildred Wuest. When the action was commenced, on February 14, 1966, the estate of Richard Wuest had been distributed to Mildred Wuest, over whose estate a conservatorship had been established.
The seven-acre parcel in January 1964 was zoned as commercial along its 450 feet of street frontage on University Avenue to a depth of 100 feet; the remainder was zoned R--1 for single-family residential units.
Stan Maykut (Maykut), a licensed real estate broker, prior to January 1964 knew from a circular letter from Bank that the parcel was for sale, and had submitted one offer, conditioned upon the offeror's ability to obtain rezoning. That offer was rejected by Bank because of that condition.
On January 27, 1964, Maykut brought to Jerry Lewis, a trust officer of Bank, who had charge of the Brown estate matter, Moss and Amateo, who were respectively the president of Bay Shore and an agent of Bay Shore. On behalf of Bay Shore, Moss presented a written offer to purchase the seven acres for $160,000 with a deposit of $16,000. Moss, on his personal credit, had obtained a commitment from the commercial department of Bank for the $16,000, a check therefor being delivered during the meeting.
Before going to Bank, Maykut, Moss and Amateo had lunched together. Maykut had proposed during the luncheon meeting that if the offer were made and accepted his commission of $16,000 would be turned over to Bay Shore to be used in making up the balance of the purchase price; that a rezoning to commercial zone be obtained so that the property zoned for commercial use would have a total depth of 200 feet; that he should be given an exclusive right to sell the commercially-zoned property for a period of two years; that Bay Shore obtain financing for construction on the property not zoned for commercial use and from such loan pay Maykut $3,000. The proposal was accepted by Moss for Bay Shore, with the further agreement that if the offer to purchase should be accepted, the agreement between Maykut and Bay Shore would be reduced to writing.
After the meeting with Bank, Maykut and Moss went to the office of Crake, attorney for Moss, where a writing was prepared at Moss' direction and was signed. It did not mention the extent of the property zoned for commercial use or the rezoning plan.
The offer to purchase provides for opening an escrow with Bank's escrow department as agent, and for payment in full into the escrow within six months.
The offer was accepted, a return of sale made, and the sale confirmed with a provision for payment of a commission of $16,000 to Maykut.
It had been Maykut's intention to set about immediately to sell the commercially-zoned property, so that the proceeds of such sale could be used as a part of the purchase price of the entire seven acres, a method of payment in which a second escrow for the resale might be used.
No mention was made to Bank of the arrangement between Maykut and Bay Shore for the use of the broker's commission as a part of the purchase price, or of the plan to obtain other funds by a resale of a part of the property during the escrow period, or of the fact that rezoning was looked to as an element essential to successful completion of the purchase; and Bank did not know of those matters until much later.
Efforts to obtain rezoning of the additional 100 feet for commercial use, and of the remaining some five acres for multiple-unit residential purposes, R--4, were commenced. The application for the additional commercially-zoned strip was obtained; the application for rezoning for R--4 use was finally withdrawn.
Bay Shore's plan for use of the property contemplated the R--4 rezoning.
Maykut obtained an offer of American Oil Company for a long-term lease of the corner zoned for commercial use; a commitment for a loan of $65,000 from another bank secured by an assignment of the lease was arranged for; tentative arrrangements were made with Bank to obtain approval of a severance of the property to be covered by the lease from the larger parcel and approval of a sale of that severed parcel to another corporation in which Moss was the principal owner which would then give the lease; Bank considered approval of such sale could be obtained for a figure of $60,000, but required as a condition that Maykut waive any claim for a commission on such sale; Maykut refused to do that because of his interest in earning commissions on resale of the commercially-zoned property.
Although the open escrow period was extended 45 days beyond the six-month period, Bay Shore did not deposit, and did not have the balance of the purchase price.
Bank obtained an order under section 788, Probate Code, which set aside the order confirming sale to Bay Shore and directed a resale.
A sale was then made and confirmed to a buyer obtained by Bay Shore at the same price and with a commission in the same amount ordered to be paid to another broker.
Before Bay Shore produced the substitute purchaser, Bank told Moss that if Bay Shore obtained such purchaser at the same price it would not be held for damages if the court would approve such arrangement. The probate court refused to approve a release of Bay Shore against liability for damages, and directed Bank to interplead Bay Shore, Maykut and all interested parties as to their rights to the $16,000 deposit.
Before such proceeding in interpleader was commenced, the present action was filed by Bay Shore against Bank and Wuest to recover the $16,000. Those defendants cross-complained against Bay Shore and Maykut, asking for a declaration of rights and duties. In his answer to the cross-complaint, Maykut asked for a declaration he was entitled to a commission.
As between Bank and Bay Shore, the cross-complaint sought reimbursement for all loss sustained by it as a result of the breach by Bay Shore.
The trial court denied to Maykut any commission, ordered the return to Bay Shore of the $16,000 less damages sustained by Bank, and found the items of damages to be as follows:
"(a) Publication on original sale $ 56.25
"(b) Executor's fees incurred on original sale 520.00
"(c) Attorney's fees incurred on original sale 510.00
"(d) Expended court costs in above action 54.90
"(e) Real property taxes paid 1,777.96
"(f) Reappraisal fees to allow confirmation
of subsequent sale 140.00
"(g) Attorneys' fees incurred by defendants
in the defense of above action 585.00
"(h) Expenses incurred by defendant-Executors
in the above action, other than taxable
court costs 10.30
"(i) Costs for cancellation of original Escrow
fixed as a reasonable amount by court 60.00
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"TOTAL $3,714.41"
BAY SHORE'S CONTENTIONS
As between Bay Shore and Bank a fundamental question presented is the jurisdiction of the superior court not sitting in probate to award damages against a defaulting purchaser, the sale to whom has been set aside under section 788, Probate Code. Although Bay Shore itself commenced the action, it now challenges the court's jurisdiction to decide all matters in controversy upon a claim that only the court sitting in probate can fix and award the damages mentioned in section 788. Bay Shore contends also that certain of the items of damage were improperly allowed.
Estate of Williamson, 150 Cal.App.2d 334, 310 P.2d 77, Estate of Efird, 130 Cal.App.2d 227, 278 P.2d 730, and Estate of Hughes, 3 Cal.App.2d 551, 40 P.2d 295, are cited in support of the claim of lack of jurisdiction. All three cases hold the court in probate has jurisdiction to award a commission payable out of the assets of an estate, and Estate of Hughes, Supra, held that such jurisdiction included jurisdiction to apportion the commission, and that such jurisdiction was exclusive in that court.
Estate of Williamson, Supra, 150 Cal.App.2d 334, 310 P.2d 77, dealt with the award by the probate court of judgment for expenses, including the amount of a broker's commission, in favor of the estate against a defaulting purchaser, to be paid...
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