Getty v. Scholz Homes, Inc.

• Decision Date: 16 June 1965
• Citation: 2 Ohio App.2d 331,208 N.E.2d 552,31 O.O.2d 512
• Parties: , 31 O.O.2d 512 GETTY et al., Appellees, v. SCHOLZ HOMES, INC., Appellants, GETTY et al., Appellants, v. SCHOLZ HOMES, INC., Appellee.
• Court: Ohio Court of Appeals

Page 331

2 Ohio App.2d 331

208 N.E.2d 552, 31 O.O.2d 512

GETTY et al., Appellees, v. SCHOLZ HOMES, INC., Appellants, GETTY et al., Appellants, v. SCHOLZ HOMES, INC., Appellee.

Court of Appeals of Ohio, Sixth District, Lucas County.

June 16, 1965.

Boggs, Boggs & Boggs, Toledo, for plaintiffs.

Shumaker, Loop & Kendrick and Robert B. Gosline, Toledo, for defendant.

GUERNSEY, Judge.

These appeals are from an action in the Court of Common Pleas of Lucas County brought by Getty and Lettell against Scholz Homes, Inc., for commissions alleged to be due to them by reason of the sale of house packages prefabricated by the defendant.

Plaintiffs' petition as amended during trial alleged, among other things, that they were partners employed as salesmen by the defendant, assigned 'exclusive territory, including Butler County, Pennsylvania, and were to be paid a commission of five per cent (5%) on all gross sales shipped into their territory and/or a commission of five (5) per cent upon orders solicited on behalf of Scholz Homes, Inc., for products of Scholz Homes, Inc., sold by the defendant in the exclusive territory hereinbefore referred to upon orders solicited and/or submitted by the plaintiffs,' 'that as a direct result of their efforts, and as a direct result of orders solicited and/or submitted by the plaintiffs there was sold and delivered by the defendant into Butler County, Pennsylvania, houses whose gross sales prices were at least requal to $378,406.00,' and that 'there is due them as commissions from said defendant five per cent (5%) of the gross sales prices of the aforesaid houses sold and delivered into plaintiffs' territory, in the amount of at least $18,920.30.'

As the exact amount of the alleged sales was unknown to the plaintiffs at the time of filing their original petition, they prayed for an accounting and recovery of their commissions as determined by the accounting. However, in answer to interrogatories annexed to the plaintiffs' reply, the gross amount of the sales was stated as being 210 house packages, at $378,406.00. These matters being established, the cause was tried to a jury as an action at law on an express contract, and will be so considered by this court.

At the close of the evidence the trial court instructed the jury, among other things, 'that from the evidence you will determine what the sales contract or agreement between the plaintiffs and the defendant was, what it provided and what at the time of the contract the meeting of the minds of the parties was as to the facts and circumstances in controversy here over the sales made in the Fernway Project.'

The jury specially found that the plaintiffs submitted orders to the defendant for 210 house packages sold by the defendant to Fernway Development, Inc., and rendered a general verdict for the plaintiffs in the amount of $18,920.30. Judgment being entered on this verdict, the defendant moved, under the provisions of Section 2323.18 et seq., Revised Code, for judgment notwithstanding the verdict and also moved for a new trial. Upon consideration, the court overruled the former motion and sustained the latter. In its order sustaining the motion for new trial the court found that the 'special findings of the jury and the verdict and judgment based thereon are entirely unsupported by the evidence and are therefore contrary to law.' It is from the order overruling the motion for judgment notwithstanding the verdict that the defendant has appealed in case number 5934, and it is from the order sustaining the motion for new trial that the plaintiffs have appealed in case number 5935.

It is undisputed in evidence that the relationship of the parties and the plaintiffs' right, if any, to commissions are based on an express contract in effect at the time of the sales herein involved, which provides, among other things, as follows:

'1. Territory:

'a.) Effective January 1, 1957, and continuing for a period of one year from this date you may, and agree to, solicit orders for our products from customers located in the below described territory:

'* * *, Butler, * * * counties in the Commonwealth of Pennsylvania. * * *

'* * *.

'2. Commissions:

'a.) For all services as above mentioned, we shall pay you the following commissions upon orders submitted by you:

'1. Five per cent (5%) of the net package price * * *.

'* * *.

'b.) In the event that Scholz Development Corporation is instrumental in establishing an active building program within your territory, a commission rate as outlined below will be paid to you on this building program.

'1. If you initiate a project in your territory which is carried out by the Development Corporation, and you service the builder, your commission on house shipments will be 2%.

'2. If a project in your area is initiated by the Development Corporation or someone in the management of the Scholz organization, but you service the builder, your commission will be 1 1/2%.

'3. If a project in your territory is neither initiated by you nor serviced by you, you will get a 1% commission.

'* * *.

'* * *.

'6. Approval of Orders:

'The company reserves the right to accept or reject any orders submitted to it, and it shall not be liable to you or anyone else for its refusal or failure to accept any order submitted. You agree to inform prospective customers of such reserved right, and to not bind the company with respect to the filling or acceptance of orders. The company shall only be obligated upon orders accepted by it at its home office.

'* * *.' (Emphasis added.)

It is also undisputed in evidence that Fernway Development, Inc., was a corporation controlled by or subordinate to the Dover Construction Company, which was a corporation controlled by Harold Gootrad, Davis Gootrad and Henry Lefkowitz, which latter company was preceded by a partnership called the Dover Company and made up of the same principls; that Dover Company and Dover Construction Company had previously developed and sold an area known as the Dover Bay Project located west of Cleveland, constructing thereon high price homes from packages fabricated by Scholz Homes, Inc.; that thereafter the same principals and/or companies developed low cost housing areas west and east of Cleveland using prefabricated home packages constructed in their own factory located in the Cleveland area; that Scholz Homes, Inc., had proposed to fabricate a low cost housing package for use in one of these areas but could not meet the cost figures of the developers; that Donald Scholz, president of defendant corporation, accompanied the Gootrads and Lefkowitz to Pennsylvania where they met with the plaintiffs who were then advised by Scholz that these developers were considering establishing a higher priced housing development near Pittsburgh using Scholz home packages and that the plaintiffs should assist them in doing so; that such proposed development was thereafter abandoned by the developers; that they thereupon became interested in developing for low cost housing a tract of land located in Butler County, Pennsylvania, thereafter known as Fernway, proposing to construct some 327 houses thereon; and that plaintiff Getty, who was also a real estate broker and a notary public was instrumental in obtaining the land for such project and assisted in the subdividing thereof.

The plaintiffs testified that the developers promised them that all the homes built at Fernway would be built from packages prefabricated by the defendant, although at that time Scholz did not have designed or in production any similar low cost home packages; that the developers had given to Getty an order, which was submitted by him to Donald Scholz, for two model homes to be prefabricated on the developers' plans together with a deposit check in the amount of $200, reserving in such order, however, the right to cancel it if the home packages could not be produced and sold to the developers at an agreeable price; and that, though requested to do so, they had never waived any commissions.

Harold Gootrad, who was the only representative of the developers testifying, stated that they had had no plans to use Scholz home packages in their low cost Fernway development, had not promised to do so, and...