Frash v. Eisenhower, 2-676A241

• Decision Date: 15 June 1978
• Docket Number: No. 2-676A241,2-676A241
• Citation: 176 Ind.App. 659,376 N.E.2d 1201
• Parties: Robert FRASH, Appellant, v. Ronald G. EISENHOWER d/b/a Lakewood Realty, Appellee.
• Court: Indiana Appellate Court

Page 1201

376 N.E.2d 1201

176 Ind.App. 659

Robert FRASH, Appellant, v. Ronald G. EISENHOWER d/b/a Lakewood Realty, Appellee.

No. 2-676A241.

Court of Appeals of Indiana,Second District.

June 15, 1978.

Jack G. Hittle, Church, Roberts & Beerbower, Noblesville, for appellant.

David M. Adams, Casior, Richards & Adams, Noblesville, for appellee.

WHITE, Judge.

Robert Frash (Frash) appeals from a judgment awarding Ronald G. Eisenhower d/b/a Lakewood Realty (Lakewood) $5,000.00 as a commission for services rendered in bringing together Frash and Phil Jones (Jones), the ultimate purchaser of Frash's property.

We reverse.

The facts upon which the trial court's judgment is based are established by admissions made in Frash's answer to Lakewood's complaint and testimony elicited in plaintiff's case-in-chief.

Frash did not present any evidence. Lakewood's evidence is that Frash contacted Jim Grady, one of Lakewood's agents, concerning the sale of property owned by Frash, property that he had in fact purchased through Grady. Frash did not, and would not, sign any listing agreement, but did agree orally that if Grady found a purchaser Frash would pay a commission of six percent. Grady eventually found a prospective purchaser, Jones. Grady and Jones together formulated the terms of a proposition to submit to Frash, including a reservation that the offer was contingent upon Jones' ability to obtain financing. Jones then typed those terms in the blank spaces of a standard proposition form used by Lakewood. Jones gave the proposition to Grady to submit to Frash and also gave Grady as an earnest money deposit a check in the amount of Ten Thousand Dollars ($10,000.00). Frash accepted the proposition as submitted and indicated his acceptance by filling in the blanks and signing the printed acceptance form on the back of Lakewood's standard proposition form:

"As the owner of the property described herein I hereby accept this proposition this II day of APril 1974 and I agree to pay to Lakewood realty Jim Grady Agent Real Estate Broker the sum of Five thousand dollars ($5,000.00) Dollars commission for services rendered in this transaction."

The underlined portions of the above acceptance represent the blanks that were filled. Where and how the acceptance was completed is not shown in the evidence, but Grady did testify that he agreed to the $5,000 commission rather than the six percent commission to facilitate the sale (i. e., increase the money Frash would retain) and that Frash signed it in his presence.

Several days later Jones advised Grady that he was unable to obtain financing for the purchase and would have to withdraw his offer. Grady, without prior consultation with or approval by Frash, returned the earnest money deposit. He subsequently advised Frash that the deal had fallen through, and unsuccessfully resumed his search for a purchaser. He had no further contact with Jones. The evidence does not show that Grady or any other agent of Lakewood investigated Jones' statement denying his ability to obtain financing, or attempted to assist Jones in obtaining financing, or attempted to renegotiate the terms of the sale.

At some unspecified later date, according to an allegation of Lakewood's complaint admitted in Frash's answer, Frash transferred his interest in the property to Jones. There is no evidence nor admission which provides any other facts concerning that transaction. ¹ The theory of Lakewood's complaint, and apparently the basis of the court's decision, is that the commission specified in Frash's acceptance of Jones' original proposition is due because Lakewood was responsible for getting Frash and Jones together. Under the evidence we cannot agree.

Since 1901 Indiana has had a statute rendering oral contracts for real estate sales commissions non-enforceable. As amended in 1913 that statute, now Ind.Ann.Stat. § 32-2-2-1 (Burns Code Ed., 1973), provides:

"No contract for the payment of any sum of money or thing of value, as and for a commission or reward for the finding or procuring by one (1) person of a purchaser for the real estate of another, shall be valid unless the same shall be in writing, signed by the owner of such real estate or his legally appointed and duly qualified representative: Provided, That any general reference to such real estate sufficient to identify the same shall be deemed to be a sufficient description thereof. (Acts 1901, ch. 67, § 1, p. 104; 1913, ch. 219, § 1, p. 638.)"

The commission contract need not be written in advance; it can, as in the case at bar, be included as part of the landowner's acceptance of the prospective purchaser's proposition. Hatfield v. Thurston (1928), 87 Ind.App. 541, 161 N.E. 568. However, the contract is not enforceable unless the sale is consummated in accord with the terms of the written contract; oral modifications are not enforceable. Thus, in Ward v. Potts (1950), 228 Ind. 228, 91 N.E.2d 643 a realtor who had entered into a non-exclusive listing contract to sell a 160 acre tract of land for $32,800 and who found a buyer who did purchase the land for $31,000 was not entitled to the 3% commission specified in the listing contract. See also:...