Fowler v. Taylor
| Decision Date | 16 August 1976 |
| Docket Number | No. 14399,14399 |
| Citation | 554 P.2d 205 |
| Parties | Ines C. FOWLER, Plaintiff and Respondent, v. Harold W. TAYLOR, dba Hal Taylor Associates, Defendant and Appellant. |
| Court | Utah Supreme Court |
Kent B. Linebaugh of Jardine, Johnson & Baldwin, Salt Lake City, for defendant and appellant.
Bryce E. Roe, Terry L. Christiansen, Salt Lake City, for plaintiff-respondent.
Plaintiff initiated this action, alleging she was employed by defendant as a real estate broker, to engage in the sale of condominium units owned by Treasure Mountain Corporation. She claimed she acted as a real estate broker, at the request of defendant; performed all duties as such; and defendant was indebted to her for the reasonable value of her services, work, and labor in her capacity as a real estate broker. She alleged that a reasonable and customary amount, to be awarded for such services, was one per cent of the total sales made during the period she was no employed.
Upon trial to the court plaintiff was awarded judgment in the sum of $9,715.25. Defendant appeals therefrom. 1 We reverse, with instructions to dismiss plaintiff's first claim. Costs to defendant.
During the autumn of 1972, both parties were employed as real estate salesmen for Treasure Mountain Corporation. Defendant was director of the corporation's real estate sales and was plaintiff's supervisor; both were licensed with the State under an officer of the corporation, who was a licensed real estate broker. The corporation constructed two condominiums. In connection with the sales of the units the corporation offered a rental pool management agreement, which was deemed a security. Appropriate registration of the security was made, and both parties were licensed as security salesmen in October 1972. In December of 1972, defendant was licensed as a securities broker-dealer. Treasure Mountain determined to employ an independent sales agent to market the units, and it entered into a contract with defendant engaging him in that capacity for a commission of 3 1/2 per cent. The salesmen were to receive 2 1/2 per cent, and defendant was to retain one per cent for his services as sales agent for the corporation.
Defendant's sales organization had a list of persons who had indicated an interest in purchasing the units as soon as defendant was qualified to market them. Defendant was not eligible to procure a real estate broker's license; so he asked plaintiff if she would activate her license and permit his organization to use her broker's license. She agreed; however, defendant performed all the paperwork, and paid the license fees and bond. The broker's license was issued in plaintiff's name with defendant and two others listed as salesmen.
With the necessary licensing completed, defendant's organization commenced operation on January 1, 1973, defendant as the securities broker and plaintiff as real estate broker. On February 19, 1973, defendant acquired his real estate broker's license, and plaintiff deactivated her license. During this 50-day interim defendant received pursuant to his contract with Treasure Mountain his one per cent commission, which amounted to $21,930.50. During this same period of time plaintiff as a salesman received $12,335, her 2 1/2 per cent commission on the units she sold. Plaintiff continued as a salesman in defendant's organization until May 4, 1973, when defendant discharged her. On about July 25, 1973, plaintiff for the first time demanded that defendant pay her the one per cent commission that he had received from Treasure Mountain.
At trial, both parties agreed that at the time defendant requested to use plaintiff's license no compensation was discussed. Defendant testified plaintiff did not request compensation, and he proffered none. Plaintiff unequivocally testified her duties did not change after January 1, 1973, from those she had prior thereto. Nevertheless, she testified that when she consented to be the broker, she expected the one per cent commission.
Defendant testified that he had contacted a friend, Robert Monson, a real estate broker, and inquired whether he would broker for defendant's sales organization until defendant qualified for his license. Mr. Monson had offered to so act without charge. He also testified that another salesman in his organization had a broker's license, which could have been activated and defendant would have so requested, if plaintiff had demanded compensation. He presented evidence showing the compensation paid to a real estate broker for the 'use' of his license varies according to the circumstances.
A review of the record does not reveal a scintilla of evidence to sustain the allegation in plaintiff's complaint that she had performed services, work, and labor in the capacity of a real estate broker for defendant. Her sole services were the execution of her signature on the applications in connection with the broker's license, bond, and trust account; and the assumption of any risks incidental to her status as a broker for defendant's sales organization. The record further reveals defendant performed all management duties for his organization and paid all the expenses arising from his performance, as selling agent of Treasure Mountain Corporation.
The trial court found between January 1 and February 19, 1973, plaintiff performed services as a real estate broker and salesman in behalf of defendant. Also, that performing these services, as a broker, plaintiff expected to be compensated; that defendant knew or should have known of such expectation.
It is customary for a real estate broker to receive a portion of the commission paid by the seller of real property. Defendant earned a brokerage commission of one per cent of his sales under his contract with Treasure Mountain, which totaled $21,930.50 for the period in question. These commissions were as compensation for defendant's services as a real estate broker and a securities broker. Defendant incurred expenses of $2,500 in connection with his operations as selling agent for Treasure Mountain Corporation, thus the net commission was $19,430.50. The trial court found that the reasonable value of the services performed by plaintiff, for defendant as a real estate broker, was one half of the net commissions earned by defendant, or $9,715.25.
The court concluded as a matter of law there was an agreement, implied in fact and in law, that defendant would pay to plaintiff the reasonable value of her services as a real estate broker, and that this agreement was not required to be in writing under the Statute of Frauds, Section 25--5--4(5), U.C.A.1953.
On appeal, defendant contends that the trial court erred in its ruling that the alleged agreement was not required to be in writing to be valid under Section 25--5--4(5), U.C.A.1953.
Section 25--5--4, U.C.A.1953, provides:
In the following cases every agreement shall be void unless such agreement, or some note or memorandum thereof, is in writing subscribed by the party to be charged therewith:
(5) Every agreement authorizing or employing an agent or broker ot purchase or sell real estate for compensation.
This provision of the Statute of Frauds was for the purpose of protecting the owners of land from fraudulent and fictitious claims for commissions. This provision does not apply to an oral agreement between a broker and another broker, salesman, or agent ot share a commission. 2
Also assigned as error is the conclusion of the trial court there was an agreement between the parties, implied in fact and law. Such a conclusion, defendant urges, is inconsistent by reason of the basic distinction in the underlying concepts of these two obligations.
An implied in fact contract differs from an express contract only in mode of expression.
. . . A contract is express or implied by reason of the expression of offer and acceptance,--whether there is a manifestation of mutual assent, by words or actions or both, which reasonably are interpretable as indicating an intention to make a bargain with certain terms or terms which reasonably may be made certain. The elements are basically identical in both cases, although the evidentiary facts may be expressed differently. . . . 3
A quasi contractual obligation is not a true contract but is based on unjust enrichment or restitution.
. . . The promise is purely fictitious and is implied in order to fit the actual cause of action to the remedy. The liability exists from an implication of law that arises from the facts and circumstances independent of agreement or presumed intention. Where the facts indicate a duty of the defendant to pay, the law imputes to him a promise to fulfill that obligation. . . . 4
Defendant contends there is no evidence to sustain a finding there was an implied-in-fact contract. With this contention we must agree, for there was no evidence of any action or conduct that reasonably could be construed as a...
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