Brenner v. Spiegle

• Decision Date: 08 June 1927
• Docket Number: 20303
• Citation: 116 Ohio St. 631,157 N.E. 491
• Parties: Brenner Et Al. v. Spiegle.
• Court: Ohio Supreme Court

157 N.E. 491

116 Ohio St. 631

Brenner Et Al. v. Spiegle.

No. 20303

Supreme Court of Ohio

June 8, 1927

Real property - Lease constitutes sale of interest in realty, when - Brokers - Written memorandum necessary to recover commission for securing tenant - Section 8621, General Code.

1. A lease of real estate is a conveyance by the owner of an estate in land of a portion of the owner's interest therein to the lessee for a term less than the owner's own, and it passes a present interest in the land. Such a conveyance for a consideration constitutes a sale of an interest in real estate.

2. Under Section 8821, General Code, no action shall be brought whereby to charge the defendant upon an agreement, promise or contract to pay a commission for securing a tenant under a lease for years of real estate unless the agreement upon which such action is brought or some memorandum or note thereof is in writing and signed by the party to be charged therewith, or some other person thereunto by him or her lawfully authorized.

This is an action brought by a real estate agent, claiming under an oral contract for a commission for the procurement of a tenant for a lease for 14 years. The defendants in the trial court filed a demurrer upon the ground that the petition did not contain facts sufficient to constitute a cause of action. The demurrer was sustained, and the petition was dismissed, the plaintiff not desiring to plead further. On error proceedings being prosecuted to the Court of Appeals, the Court of Appeals reversed the judgment of the court of common pleas upon the ground that "Section 8621 of the General Code of Ohio, as amended does not apply to a contract by which an owner of real estate agrees to pay a broker a commission for obtaining a lessee for real estate owned by him, but relates only to the sale of an interest in real estate."

The case comes into this court upon allowance of motion to certify the record.

Messrs Weygandt & Ross, for plaintiffs in error.

Mr Benton G. Hay, for defendant in error.

ALLEN J.

The question of substance presented by this record is whether under Section 8621 of the General Code, as amended in 1925 (111 Ohio Laws, p. 104), an action to recover commissions based upon the securing of a tenant for the lease of real estate does not lie unless the contract to pay such commission is in writing.

The statute, as amended in 1925, reads, in its material portions, as follows:

"No action shall be brought whereby to charge the defendant, * * * upon an agreement, promise or contract to pay any commission for or upon the sale of an interest in real estate * * * unless the agreement upon which such action is brought, or some memorandum or note thereof, is in writing, and signed by the party to be charged therewith, or some other person thereunto by him or her lawfully authorized."

The petition in this action, to which a demurrer was filed and sustained, sets up that in the month of June, 1925, the defendants orally employed the plaintiff, a real estate broker, to find and procure a tenant and lessee for their certain premises in the city of Wooster, Ohio, and to pay him a commission therefor, and that the plaintiff accepted such employment. The petition then avers that the plaintiff found a tenant able, ready, and willing to make the lease, and notified the defendants of that fact, and that the lease in question was executed on or about the 30th day of July, 1926, with the same party with whom the plaintiff was negotiating for the making of the lease, and then prays for judgment in the amount of the commission, as alleged to have been agreed.

The statute which is construed in this case took effect upon July 9, 1925. It constituted an amendment to the original statute of frauds, and included in that statute the following words:

"Nor upon an agreement, promise or contract to pay any commission for or upon the sale of an interest in real estate."

It is in brief the argument of the defendant in error, and was so held by the Court of Appeals, that the word "sale" here means only the transfer for a consideration from one to another of the title of property sold, completely divesting the vendor of any interest in, or control over, the said property.

With this view of the statute we cannot agree. The statute qualifies the word "sale" by the words "of an interest in real estate." The statute does not say "sale of a fee" or "sale of the whole interest of the vendor in real estate." It says "sale of an interest in real estate," and thereby expressly declares that the transaction for which the memorandum in writing is required is that of the transfer for a consideration of any interest in real property.

This view of the meaning of the words is borne out by their definition. In the Century Dictionary, the word "sale" is defined as meaning:

"In law, a contract for the transfer of property from one person to another, for a valuable consideration."

That the execution of a lease constitutes a conveyance of an interest in real property is the almost universal judicial holding. Thus in 1 Tiffany, Landlord and Tenant, Section 16, p. 162, the rule is stated as follows:

"Taking the most ordinary case of a lease, one for a term of years, it would generally be conceded that its effect is to create in the lessee an estate for years, a class of estate as well recognized at the present day, though not formerly, as an estate in fee simple or for life. So a lease for life undoubtedly creates an estate for life in the lessee. * * * And a lease from year to year, or other periodic lease, creating as it does a term for at least one year or other period named, must also be regarded as creating an estate in the lessee."

This definition is supported by the following authorities, which are only a few of those available upon this question:

"A `lease' is a conveyance by the owner of an estate to another of a portion of his interest therein for a term less than his own, and it passes a present interest in the land for the period specified." Chandler v. Hart, 161 Cal. 405, 119 P. 516, Ann.Cas., 1913B, 1094.

"Lease is conveyance of lands or tenements, usually in consideration of compensation, made for life, for years, or at will, but for less time than lessor has in premises, and creates an estate, and is not a mere contract." In re Barnett, (C.C.A.), 12 F. (2d), 73.

"A `lease' is a conveyance of an estate in realty and divests the owner for a given time of a certain estate therein leaving in him the reversion." Mattingly's Ex'r. v. Brents, 155 Ky. 570, 159 S. W., 1157.

"A `lease' is properly a conveyance of a particular estate in lands for life or for years, or at will where reversion is left in the grantor." Chittim v. Gossett, 228 S. W., 393.

"A `lease' is a conveyance, but it is a conveyance of a limited estate for a limited term with conditions attached, and is not an executed contract until the term expires and the conditions are fulfilled." Shepard v. Sullivan, 94 Wash. 134, 162 P. 34; Powers v. Trustees of Caledonia County Grammar School, 93 Vt. 220, 106 A. 836; Williams v. Randolph & C. Ry. Co., 182 N. C., 267, 108 S. E., 915; Mower v. Rasmusson, 34 N. D., 233, 158 N. W., 261; Kavanaugh v. Cohoes Power & Light Corp., 114 Misc. 590, 187 N. Y. S., 216; Minneapolis Iron Store Co. v. Branum, 36 N. D., 355, 162 N. W., 543, L.R.A., 1917E, 298; Texas Pacific Coal & Oil Co. v. Fox, (Tex. Civ. App.), 228 S. W., 1021.

It would have been simple for the Legislature, if it had so desired, to limit the provisions of this statute to cases of conveyance...