Cole v. Brundage

• Decision Date: 03 March 1976
• Docket Number: No. 61296,61296
• Citation: 344 N.E.2d 583,36 Ill.App.3d 782
• Parties: Robert M. COLE, Plaintiff-Appellee, v. Avery BRUNDAGE and Samuel E. Schulman, Defendants-Appellants.
• Court: United States Appellate Court of Illinois

Page 583

344 N.E.2d 583

36 Ill.App.3d 782

Robert M. COLE, Plaintiff-Appellee, v.Avery BRUNDAGE and Samuel E. Schulman, Defendants-Appellants.

No. 61296.

Appellate Court of Illinois, First District, Fourth Division.

March 3, 1976.

Ralph E. Davis, John L. Conlon, William G. McMaster, Jr., Chicago (Hopkins, Sutter, Mulroy, Davis & Cromartie, Chicago, of counsel), for defendant-appellantAvery Brundage.

Rothbart Stein & Moran, Chicago (Thomas E. Moran, George E. Sweeney, Edward V. Scoby, Chicago, of counsel), for defendant-appellant, Samuel S. Schulman.

Hoffman & Davis, Chicago (Sol A. Hoffman, Edward J. Hladis, Alvin L Kruse, Chicago, of counsel), for plaintiff-appellee, Robert M. Cole.

BURMAN, Justice.

The plaintiff, Robert M. Cole, commenced this action for a broker's commission arising out of the sale of the La Salle Hotel by the defendant, Avery Brundage(hereinafter referred to as Brundage) to the defendant, Samuel Schulman(hereinafter referred to as Schulman) on November 4, 1970.¹After a lengthy trial the jury returned a verdict in the amount of $133,500 against each defendant.In response to special interrogatories submitted by Brundage, the jury found that an implied brokerage contract existed between plaintiff and each of the two defendants.The trial court entered judgments on these verdicts, thus giving rise to the instant appeal by both Brundage and Schulman.

The defendants were represented by separate firms of attorneys and each of them pursued separate although partially overlapping defenses.Consequently, while the issues raised on appeal are distinct, they retain common denominators.Brundage contends that the trial court erred in denying his motion for a judgment notwithstanding the verdict because of the insufficiency of the evidence as to (1) the creation of any implied brokerage contract between the plaintiff and himself or (2) the creation of an implied dual brokerage arrangement whereby plaintiff could have represented both him and Schulman.Schulman contends that (1) a buyer of real estate customarily is not responsible for a broker's commission in the absence of a special agreement and the record is devoid of any evidence indicating that he had a special agreement with plaintiff; (2)plaintiff is not entitled to collect a commission from both Brundage (seller) and himself (buyer) due to the plaintiff's failure to disclose his purported dual agency; and (3)plaintiff failed to prove a necessary element of an implied contract, namely, that he(Schulman) was cognizant that the plaintiff expected to be compensated by him for his efforts.

Besides the above contentions pertaining to plaintiff's brokerage commission, both defendants maintain that the trial court erroneously instructed the jury as to the law governing the case.In addition Brundage contends that the trial court erred in (1) admitting certain testimony concerning custom and usage in the payment of brokerage commissions, (2) refusing to admit a letter written by another broker to plaintiff, and (3) failing to order plaintiff to produce certain memoranda for Brundage's inspection.

Before delving into the pertinent facts surrounding the instant controversy, it is important to present a biographical sketch with regard to the parties in interest.Plaintiff has been licensed real estate broker in Chicago since 1934.During this time frame, he has dealt almost exclusively in commercial and industrial property and has had extensive experience with complicated and expensive properties.Brundage, who died on May 8, 1975, during the pendency of this appeal, had been in the construction business for thirty years.He had been a real estate broker but acted solely in management of buildings.At the time of the trial, his occupation was confined to the management of his own personal affairs, which included the ownership and operation of the La Salle Hotel.He also served as president of the International Olympic Committee from 1952 to 1972.Schulman also has had extensive real estate experience which encompassed the ownership, construction and operation of a number of buildings in Chicago.

A review of the record reveals that it is replete with conflicting testimony.However, in considering whether either or both defendants were entitled to a directed verdict or a judgment n.o.v., we must keep in mind that the party resisting said motions is entitled to the benefit of all the evidence favorable to him.The oft cited rule is that a defendant is entitled to a directed verdict or a judgment n.o.v. when all of the evidence, viewed in its aspect most favorable to the plaintiff, so overwhelmingly favors the defendant that no contrary verdict based on such evidence could ever stand.(E.g., Risse v. Woodard(7th Cir.), 491 F.2d 1170, 1171;Schmidt v. Archer Iron Works, Inc., 44 Ill.2d 401, 405, 256 N.E.2d 6, 8, Cert. denied, 398 U.S. 959, 90 S.Ct. 2173, 26 L.Ed.2d 544;Pedrick v. Peoria and Eastern R.R. Co., 37 Ill.2d 494, 510, 229 N.E.2d 504, 513--14.)The following facts are presented in conformance with this rule.

Plaintiff's initial encounter with Brundage occurred in 1947 when he personally submitted an offer of 8.5 million dollars for the purchase of the La Salle Hotel on behalf of a real estate investor.In response to this proposal, Brundage informed the plaintiff that he had not owned the hotel for a sufficient period of time nor had he properly developed it to justify a sale at that point in time.However, Brundage did indicate, as he did on subsequent occasions, that he would sell the hotel to the right party, at the right time, and at the right price.Although the plaintiff made periodic inquiries with Brundage concerning the possible sale of the hotel, his next personal contact with him arose in the late 1950's.At that time, the First National Bank of Chicago was experiencing difficulty in procuring an entire block for its new building.Speculating that the bank would be interested in the block where the hotel was situated, the plaintiff obtained a verbal sales figure of 8 million dollars from Brundage, but no sale was ever consummated.Subsequent to this meeting, the plaintiff did not converse in any manner with Brundage until September, 1964, when, as a result of the following facts, negotiations for the hotel between Schulman and Brundage commenced.

Plaintiff had known Schulman for approximately twenty years and had acted in his behalf in various business transactions.These transactions included the purchase and sale of buildings located in Chicago, Illinois.In 1964, Schulman, general partner and operating manager of the Water Tower Inn Hotel, was interested in leasing that hotel.Plaintiff procured a prospective lessee for the hotel, but, after several months of negotiations, a lease of the hotel did not reach fruition.However, during the course of a meeting between the plaintiff, Schulman, and Frank Little(another real estate broker) concerning the possible lease, Schulman stated that if he were successful in disposing of his responsibilities in the Water Tower Inn, he would be interested in a major property.He indicated a preference for La Salle Street properties.Plaintiff responded to this statement by opining that the only major property that could be acquired was the La Salle Hotel.Subsequent to Schulman's expression of interest in such property, the plaintiff stated that he would proceed to negotiate.

Approximately two weeks later, plaintiff engaged Schulman in a telephone conversation.During their talk Schulman related that he wanted to make an offer for the hotel.Pursuant to this request, plaintiff contacted Brundage and informed him that he might have an offer for the hotel.Thereafter, plaintiff met with Schulman at the Water Tower Inn.Schulman told him that due to plaintiff's ability to handle such matters, he wanted him to take an offer of 8.4 million dollars (6 million in cash and the remainder to cover an existing mortgage) to Brundage.Schulman stated further that if Brundage expressed the slightest bit of interest, the offer would be formalized in writing with the earnest money on the following Monday.Upon termination of this meeting, plaintiff proceeded to Brundage's office where Schulman's offer was rejected by Brundage.Plaintiff thereafter telephoned Schulman and advised him of the rejection.

In October, 1964, plaintiff arranged a meeting at Brundage's office between Brundage, Schulman and himself.At that meeting, plaintiff formally introduced Schulman to Brundage.Plaintiff discussed Schulman's qualifications as a hotel operator and further requested certain financial data relating to the operation of the hotel.In response to this request, Brundage telephoned Frederick Ruegsegger, his executive assistant and also the comptroller and general manager of the hotel, and told him to supply the plaintiff with such financial information.Moreover, when the meeting concluded, Brundage arranged a tour of the hotel for the plaintiff and Schulman.Subsequent to this meeting, the plaintiff personally met with Ruegsegger who supplied him with financial information relating to the operation of the hotel.Plaintiff thereafter sent a copy of said data to Schulman.

The next meeting concerning the possible sale of the La Salle Hotel occurred at Brundage's office on April 20, 1965.Present were plaintiff, Brundage, Schulman and Ruegsegger.Although the duration of the meeting was approximately an hour, numerous topics were discussed, including the price and conditions of the sale, the assets of the hotel, and the tax aspects of the transaction.Besides this meeting, the only contacts the parties had during the remainder of 1965 were numerous telephone calls and luncheon meetings between plaintiff and Ruegsegger, in which the latter provided plaintiff with further data concerning the hotel.

In June, 1966, Brundage telephoned plaintiff and asked him to come to the hotel immediately.When he...