Harris v. McPherson

• Decision Date: 05 January 1922
• Citation: 97 Conn. 164,115 A. 723
• Court: Connecticut Supreme Court
• Parties: HARRIS v. McPHERSON et al.

115 A. 723

97 Conn. 164

HARRIS v. McPHERSON et al.

Supreme Court of Errors of Connecticut.

January 5, 1922

Appeal from Court of Common Pleas, Hartford County; Edwin C Dickenson, Judge.

Action by Morton S. Harris against Minnietta S. McPherson and another. From judgment for plaintiff, defendants appeal. No error.

BEACH and Burpee, JJ., dissenting.

Alvan Waldo Hyde and J. Harold Williams, both of Hartford, for appellants.

Terry J. Chapin, of Hartford, for appellee.

CURTIS, J.

The plaintiff in March, 1918, and thereafter was a real estate broker, dealing in property in Suffield and vicinity, and the defendants were owners of a suburban farm in Suffield. On March 11, 1918, the defendants employed the plaintiff to sell the farm, and signed and delivered to him a written agreement (Exhibit A) in the following terms:

" Contract.

Suffield Conn., 3/11/1918.

This is to certify that on this date I have given to Morton S. Harris the exclusive sale of my property, viz.: Six acres land more or less with all standing buildings thereon, for the sum of $8,000. (8000.00) and do agree to pay the said M. S. Harris 5 per cent. of the purchase price at transfer of deed.

F. B McPherson.

Minnietta S. McPherson."

The plaintiff accepted the employment under the agreement and advertised the property at his own cost, and incurred other expenses and spent time in interviewing and answering inquiries of prospective purchasers of the property, but did not produce a customer ready, able, and willing to buy the land.

A few weeks later, before April 20th, 1918, the defendants sold the property to a purchaser of their own procuring for $8,000. Thereupon the defendants notified the plaintiff of such sale and withdrew the property from the plaintiff's hands. The plaintiff claimed his commission under the terms of the written agreement, but the defendants refused to pay it.

Upon the trial the defendants claimed that the writing signed by them and delivered to the plaintiff did not create a mutual contract as it contained no promise by the plaintiff, and that the plaintiff was merely an agent employed to procure a purchaser, and, as no purchaser had been procured by him, he was not entitled to a commission. The court overruled this claim.

The fact that the plaintiff upon the receipt from the defendants of the writing Exhibit A used reasonable efforts to procure a purchaser for the property and expended money and time in so doing, constitutes a sufficient basis for the court's holding that in law there was such an acceptance of the offer contained in Exhibit A as created a mutual contract. Hayes v. Clark, 95 Conn. 510, 111 A. 781.

The defendants also claimed that, if a mutual contract arose by the plaintiff's acceptance through acts of the offer contained in this agreement, yet that such contract did not preclude the sale of the property by the defendants to a purchaser of their own procuring, without obligation to pay a commission to the plaintiff as damages for a breach of contract. In other words, that the giving of the exclusive sale of property by an owner to a broker, at the most, gave him merely an exclusive agency.

In the law relating to the relations between the owner of real estate and a broker employed to procure a purchaser, there is a difference in the cases in interpreting a contract in which the owner gives the broker the exclusive sale of property. 9 Corpus Juris, 622; 4 Ruling Case Law, 318.

There appears to be no diversity of view in interpreting a contract whereby the owner gives the broker an exclusive agency. Such a contract may be defined as follows:

A contract employing a broker as an exclusive agent is an agreement on the part of the owner that during the life of the contract he will not sell the property to a purchaser procured through another agent. This does not preclude the owner from selling to a purchaser of his own procuring.

There are cases which define a contract by the owner giving a broker the exclusive sale of property as giving him merely an exclusive agency as defined above.

We are satisfied that the weight of reason and authority support the following definition of such a contract: A contract of the owner, giving a broker the exclusive sale of property, is an agreement on the part of the owner that he will not sell the property during the life of the contract to any purchaser not procured by the broker in question. Murphy v. Sawyer & Warford, 152 Ky. 645, 153 S.W. 991.

In the instant case, the contract with the broker gave him the exclusive sale of the property. Therefore a sale by the owner to a purchaser of his own procuring was a breach of contract if made while the contract was in force.

The contract dated March 11, 1918, contains no provision as to its duration. Was it in force when the sale was made by the owner? The owner, in a contract giving a broker the exclusive sale of property, makes the broker the only medium through which a purchaser can be procured during the life of the contract. The owner agrees, in such a contract, not only to exclude another agent, but also himself from procuring a purchaser.

Ordinarily in this class of contracts the exclusive sale is given to the broker for a definite time. Where the duration of the contract is not specified, what is the life of the contract?

It is to be observed that this contract is not one of a general agency employment, as that of a salesman; it is a contract to procure a purchaser for one specific piece of property, and is confined to the accomplishment of a particular transaction.

The rule of law that where there is a general employment of a servant with no provision as to the duration of the employment the employment is at will and may be terminated by either party at any time without violating a contract is not pertinent to an employment for the accomplishment of one particular transaction.

In such an employment the rule set forth in 2 C.J. 525, is the reasonable and just rule:

" Where the agency is for the accomplishment of a particular transaction or specific purpose, the law implies its continuance for at least a reasonable time." Ewart L. Co. v. A. C. P. Co., 9 Ala. App. 152, 62 So. 560; Marquam v. Ray, 65 Or. 41, 131 P. 523; Turner v. Snyder, 132 Mo.App. 320, 111 S.W. 858; Wanstrath Real Est. Co. v. Wenz, 185 Mo.App. 162, 170 S.W. 345.

This conforms to the general principles as found in Williston on Contracts, vol. 1, § 38; Page on Contracts, vol. 2, § 1154; Pollock on Contracts, p. 536. A reasonable time in this connection is in effect a definite time, to be fixed as a matter of fact by a court in case of controversy.

Under the ordinary so-called listing contract of employment of a broker to procure a purchaser where the exclusive sale is not given, it is generally held that the employment may be terminated by the owner at will, and that a sale of the property by the owner terminates the employment. But it is clear that such an ordinary so-called employment of a broker does not consist so much of a contract as an offer, which does not ripen into a contract unless the broker procures a purchaser while the owner still holds the property. Cadigan v. Crabtree, 179 Mass. 474, 61 N.E. 37, 55 L.R.A. 77, 88 Am.St.Rep. 397. Such an employment is called a mere listing contract. Fields & Combs v. Vizard I. Co., 168 Ky. 744, 182 S.W. 934, Ann.Cas. 1918D, 336. So it was held that such a listing contract does not give the broker a reasonable time to procure a purchaser, but that he could be dismissed at any time. Cadigan v. Crabtree, supra.

In the case of a mere listing contract with a broker to procure a purchaser of property, the sale of the property by the owner revokes the agency without notice to the broker. Mechem on Agency (2d Ed.) § 619; Real Estate Agency, Walker, § 15; 4 R. C. L. 254.

In dealing with cases of contract for the exclusive sale, the distinction between the power of the owner to revoke the broker's authority and the owner's right to terminate the contract of employment must be carefully observed. Mechem, vol. 1, sec. 568 (2d Ed.) deals with this matter as follows:

" Distinction may be made in these cases between the power to revoke and the right to revoke; the principal always having the power to revoke, but not having the right to do so in those cases wherein he has agreed not to exercise his power during a certain period. If, in the latter case, he does exercise his power, he must respond in damages. The same conclusion may also be reached in other cases by distinguishing between the authority and the contract of employment. The authority may be withdrawn at any moment, but the contract of employment cannot be terminated in violation of its terms, without making the principal liable in damages."

The owner's power to revoke the broker's authority so that the owner will not be bound as to a third party by the broker's act after revocation is most extensive. Subject to certain...