Fishbein v. Zexter
Decision Date | 13 November 1970 |
Docket Number | No. 980-A,980-A |
Citation | 107 R.I. 672,270 A.2d 510 |
Parties | Dr. Jay N. FISHBEIN v. Abram M. ZEXTER. ppeal. |
Court | Rhode Island Supreme Court |
This civil action was brought to recover on a promissory note executed by the defendant. The defendant thereupon made a counterclaim for money due under an alleged agreement with the plaintiff to compensate him for services rendered in connection with a transaction between the plaintiff and Dunkin' Donuts of America, Incorporated. A justice of the Superior Court grant the plaintiff's motion for summary judgment on the promissory note and denied the motion for summary judgment on the defendant's counterclaim. The cause was then heard on the counterclaim of the defendant by a justice of the Superior Court sitting without a jury who, finding for the defendant in the amount of $7,000, entered judgment for the defendant in the amount of $1,750, the different between the award of $5,250 to the plaintiff on the note and the award to the defendant on the counterclaim. From that judgment the plaintiff is in this court prosecuting an appeal.
The record discloses that plaintiff invested in real estate on several occasions and that defendant at the time under consideration was licensed by this state as a real estate broker. There is evidence that the parties became acquainted sometime in March 1965, when they engaged in transactions involving real estate not related to the instant case. In April 1965, defendant met an official of Dunkin' Donuts of America, Incorporated, who informed him of opportunities for investors to develop real estate in connection with the franchising activities of that corporation conducted through a subsidiary corporation.
In June 1965, defendant consulted with plaintiff to interest him in possible real estate investments. The defendant informed plaintiff that the corporation wished to interest investors as potential purchasers of two parcels of land, one located on Smith Street in the city of Providence and the other in Meriden, Connecticut. He informed plaintiff that the corporation was interested in these parcels of real estate as possible sites for franchising outlets. It is not disputed that plaintiff, defendant, and officials of that corporation conferred on several occasions during the summer of 1965 concerning the execution of leasing agreements between plaintiff and the franchising subsidiary of the corporation, Dunkin' Donuts Franchising Corporation.
During July 1965, plaintiff loaned defendant $5,000 for a period of six months, and defendant executed a promissory note and delivered it to plaintiff. The defendant testified that he had borrowed that money 'in anticipation of the deal.' As a result of these conferences plaintiff purchased the Smith Street parcel and agreed with the franchising corporation officials to lease the premises together with a building thereon to be erected by plaintiff to the franchising corporation for a term of 20 years. A similar arrangement was made with respect to the leasing to the franchising corporation of the parcel of property located in Meriden, Connecticut. On August 26, 1965, such a lease was executed by plaintiff and the Dunkin' Donuts Franchising Corporation for the property in Meriden, Connecticut, and in September of that year a similar lease was executed by the parties with respect to the property located on Smith Street.
The case was then tried to the court on the question of whether the services performed by defendant for plaintiff were those of a broker. The plaintiff argues correctly that if the services constituted a brokerage contract, defendant's action to recover is barred by the statute of frauds. That statute, G.L.1956 (1969 Reenactment) § 9-1-4, provides that no action shall be brought In other words, the court passed upon the question of whether defendant acted as a broker for plaintiff or was merely acting as a finder who brought the parties together. If he were acting as a broker, the action would be barred by the above-quoted provisions of § 9-1-4, it being conceded that there is no memorandum in writing as required by that statute.
The trial justice, in reaching a conclusion on this question, relied on the definition of a broker as set forth in Ames v. Ideal Cement Co., 37 Misc.2d 883, 235 N.Y.S.2d 622. There the New York court defined to broker as one '* * * whose duty is to bring the parties to an agreement on his employer's terms.' On the other hand, the trial justice defined a finder as follows: 'The finder is one who finds, interests, introduces and brings the parties together for the deal which they themselves consummate.' The New York court then went on to say, referring to the concept of a finder: 'But their distinction from the status of a broker, if the circumstances of the particular case require such a distinction to be drawn, lies in their bringing the parties together with no involvement on their part in negotiating the price or any of the other terms of the transaction.'
The trial justice thereupon found on the evidence that defendant had established his status as a finder, the court saying at page 368 of the transcript: Donuts together, that they negotiated their...
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