Buckley v. Woodlawn Development Corp.

• Decision Date: 10 June 1957
• Docket Number: 42927,Nos. 42555,s. 42555
• Parties: Charles Edwin BUCKLEY v. WOODLAWN DEVELOPMENT CORPORATION et al.
• Court: Louisiana Supreme Court

Page 92

98 So.2d 92

233 La. 662

Charles Edwin BUCKLEY v. WOODLAWN DEVELOPMENT CORPORATION et al.

Nos. 42555, 42927.

Supreme Court of Louisiana.

June 10, 1957.

Rehearing Denied Nov. 12, 1957.

Hudson, Potts & Bernstein, Fred G. Hudson, Jr., Monroe, for appellant.

McHenry, Lamkin, Snellings & Breard, Monroe, for appellant-appellee.

Thompson, Thompson & Sparks, Monroe, for appellee.

HAMLIN, Justice ad hoc.

Charles Edwin Buckley, a licensed realtor, brought this suit against Woodlawn Development Corporation to recover the sum of $3,250, alleged to be due him as a realtor's commission on the sale of 487.25 acres of the Bob Harman Plantation, situated south of Monroe, Louisiana, owned by Woodlawn Development Corporation. In the alternative, he prayed for judgment against Earl J. Wills, individually.

Plaintiff predicated his suit upon an exclusive listing contract¹ executed on March 24, 1954, by him and Earl J. Wills, who signed the contract as follows:

'Woodlawn Development Corporation

'Signed by: Earl J. Wills

'Owner'

On April 30, 1954, the property herein involved was sold to Louisiana Machinery Company. Inc., for a consideration of $65,000. L. M. Ray, President and owner of approximately 80% Of the stock of Woodlawn Development Corporation, signed the act of sale on behalf of said corporation, having been properly authorized to do so by the Board of Directors.² The amount plaintiff alleges is due him represents 5% Of this sale price.

The trial court rejected plaintiff's demand against Woodlawn Development Corporation, holding that there was no corporate authority in Earl J. Wills to execute the Exclusive Listing Contract on behalf of Woodlawn Development Corporation. The court rendered judgment against Earl J. Wills, personally and individually, on the alternative demand.

Plaintiff appealed from the judgment in favor of Woodlawn Development Corporation, and Earl J. Wills later appealed from the judgment against him individually. We have for consideration cross appeals, which will be disposed of in one decree.

Woodlawn Development Corporation was incorporated on August 16, 1947. Its purposes were varied, but, principally, it dealt with the development of residential property.³ At the time of the trial of this matter, and during the years 1953 and 1954, Louis M. Ray held the office of president and controlled the business. In addition to Mr. Ray, there were two other stockholders, who owned only qualifying shares.

During the month of June, 1953, the defendant Earl J. Wills, an attorney from Texas and a brother-in-law of Mr. Ray, accepted employment in Monroe, Louisiana, with Associated Contractors, Inc., a Louisiana corporation--the majority stock of which corporation was also owned by Louis M. Ray. With respect to Wills' employment, Ray testified as follows:

'* * * he was employed about two years ago with the idea of handling some legal matters and heavy legal work but it was determined after he had been there for some time--and I think to his choice that he didn't want to do that kind of work and he was connected with the construction companies at which time he has stayed on the job from 2 to 3 months--on several different jobs 2 to 3 months at the time devoting his entire efforts and work to those individual jobs and when the job was complete he would come back to the office and of course he was a straight time man and if he would be around the office, somebody would call up and want to see a lot why he would go out and show them a lot and some letter that come in that needed answering I would ask him sometime, Earl answer this letter, tell them so and so or something for me or just various things of that kind unless he was busy or something else and he has been on the payrolls of Associated Contractors, Inc. which is a heavy and general contracting firm we operate and also he has been employed by the Acme Wellpoint Corporation which is involved in subsurface water controls and works of that nature for sometime and he has also been employed--during March he wasn't employed by either one, I think he was employed by Bain and Wolff Construction Company of which he is President and at no time--I can definitely state that at no time in the last two years or ever to my knowledge has he received a penny of compensation in the way of salaries, commissions or fees from the Woodlawn Development Corporation.

'It was my intentions to make an administrator out of him or an office assistant at the time I hired him but Mr. Wills is very much of an outdoor man and he likes construction work and just for one reason and another it didn't work out that way and he was never--has been able to qualify to handle legal work in the State of Louisiana and so it just drifted within the first two or three months, well he drifted off to these other angles of work.'

Ray further testified that had Wills' employment worked out as planned, he might have made him a vice president.

The record reflects that Wills at times presented himself as Vice President of Woodlawn Development Corporation and that this was not unknown to its officers. The record further discloses that Wills had business cards, on which he listed himself as Vice President and General Counsel of L. M. Ray Construction Corporation, Associated Contractors, Inc., Woodlawn Development Corporation, and Acme Wellpoint Corporation--all of which corporations were controlled by L. M. Ray.

Ray testified that he loaned Wills the money to buy Bain and Wolff, Inc. and that he subcontracted one of his jobs for Associated Contractors to Bain and Wolff, Inc. However, he further stated that he never empowered Wills to sign any documents for him.⁴

The record shows that Woodlawn Development Corporation purchased the property herein involved in 1952 for subdivision purposes, which never developed. Ray stated that the corporation invested $95,000 in the property and that he finally realized that it would have to be sold at a loss.

During March, 1954, Ray negotiated with a bank for a loan on some of the corporation's property, and the bank asked the plaintiff, Charles Edwin Buckley, to make an appraisal. During an interview with Ray on March 23, 1954, at which Wills was present, Buckley approached Ray with respect to giving him an exclusive listing of the Bob Harman property for sale. Although Ray gave Buckley maps of the property and told him that a commission would be discussed if a prospect was found, he testified that he refused to give him a listing and his testimony is as follows:

'I don't specifically remember, however, I don't deny giving him the maps but I don't remember that but the meeting was concluded when I told him that he was--if he wanted to sell real estate and brought me a prospect he was perfectly all right to sell it and if' (he) 'would have sold a lot up here--or some of my vacant lots for anywhere from $1,000.00 to $3,000.00 or even up to $5,000.00 on a vacant piece of property well I usually pay 5% But on a transaction as large as selling a house for $15,000.00 or $20,000.00 or a farm I just wouldn't--I wouldn't pay but 50% Of the commission and that I wouldn't give an exclusive listing under any consideration. If he found someone that was interested in any of my property he could bring them to me and tell me who his prospect was or--and I would give him a definite quotation on it and if he closed it out he was entitled to his commission, that's it.'

He further testified:

'* * * so I told Mr. Buckley that under those terms, sure he could--if he found a prospect for any of my property and sold it it would be perfectly agreeable with me that I would pay him a usual commission. That was at the meeting that lasted I guess 30 or 45 minutes talking about first one business and another and he left, that is the last I've heard of Mr. Buckley. I understand--the next day--I left town the next day--now I wouldn't say specifically that it was the next day but it was within two or three days, one to three days after this meeting he came back out to my office and I was out of town.'

The next day, March 24, 1954, Buckley again went to Ray's office and found him to be out of town, but Wills was in the office and signed the Exclusive Listing Contract herein involved. Buckley then advertised the property for sale, on April 11, 12, 13, 14, 15, 20, 21--23, 25 and 26. He heard through an outside party that Mr. Carbone of the Louisiana Machinery Company, Inc. was interested in the property, and he called on him. He told Mr. Carbone that he had an exclusive listing on the property but that he did not want him to hold back from purchasing because of the listing. When Buckley read of the sale of the property, he telephoned Ray and demanded his commission. Ray replied that he was unaware of the listing and that he would have to talk to Wills, who was out of town, 'and see what the score is on that, I don't known.' Upon receiving a definite answer, communicated by Wills, that he would not receive any commission, Buckley filed the present suit.

To plaintiff's petition, Woodlawn Development Corporation and Earl J. Wills filed a joint answer signed by counsel. Therein, they denied any authority on the part of Wills to execute the agreement on behalf of Woodlawn Development Corporation.

Thereafter, Wills filed an amended answer, in which he denied the averments contained in his joint answer with Woodlawn Development Corporation and admitted that he had represented to plaintiff that he had authority to sign the contract for the corporation. He then assumed the position of cross-plaintiff and prayed for indemnity against Woodlawn Development Corporation if he be held liable.

Wills' testimony is to the effect that he had authority from L.M. Ray to sign the contract, but that he did not know that it was an exclusive listing contract and had told Buckley that it would not be exclusive. He stated:

'On the morning of March 24th at approximately 7:00 o'clock that morning I...