Heaton v. Boulders Properties, Inc.
| Citation | 566 A.2d 1127,132 N.H. 330 |
| Decision Date | 13 November 1989 |
| Docket Number | No. 88-231,88-231 |
| Parties | Xenia K. HEATON and Donald W. Stone v. BOULDERS PROPERTIES, INC. and Enrique Darer. |
| Court | Supreme Court of New Hampshire |
Baker & Hayes, Lebanon (William A. Baker on brief and C. Nicholas Burke on brief and orally), for plaintiffs.
Brownell & Moeser P.C., Norwich, Vt. (Douglas S. Moore on brief and orally), for defendants.
This case involves a dispute over the payment of a real estate broker's commission resulting from the sale of property pursuant to a non-exclusive listing contract. The defendants, Enrique Darer and Boulders Properties, Inc., appeal from the Superior Court's (Murphy, J.) order approving a Master's (Louie C. Elliott, Esq.) recommended denial of their summary judgment motion, as well as appealing from the Superior Court's (O'Neil, J.) decision in a later trial that the plaintiffs, Xenia Heaton and Donald Stone, were the procuring cause of the sale of the property described in the listing contract. The plaintiffs appeal the amount of the verdict, as well as the dismissal of the action against Darer, granted after trial. We reverse the denial of the defendants' summary judgment motion and in so doing moot the other issues presented.
Enrique Darer purchased an option to buy certain property in Lebanon from one John Piane, in July 1983. Two months later, on September 1, 1983, Darer entered into a non-exclusive real estate listing agreement for the Lebanon property option with Xenia Heaton, a licensed realtor. Darer did not yet have title; he had not exercised the option, and never did, but was in effect listing, with the realtor, his right to buy the land. The listing agreement specified that the property was to be sold together with all the necessary State and city approvals for a proposed 132-unit apartment complex, and that a 10% real estate broker's commission would be paid to the first broker consummating the sale. Later in September, Darer and others formed Boulders Properties, Inc. to acquire and develop the Lebanon property described in Darer's option. Darer testified that he transferred his interest in the Lebanon property to Boulders Properties, Inc. when it was formed in September. In conjunction with Heaton, Donald Stone, a licensed real estate broker who had a "co-broker" agreement with Heaton, produced Paul Mack as a potential purchaser, in September. On October 13, Boulders Properties, Inc. entered into a purchase and sale agreement with Mack whereunder Mack agreed to purchase a substantial portion of the property in question, roughly 13 of the total 17 acres. The October purchase and sale agreement specified a May 1, 1984 closing date. Despite a subsequent agreement to extend the closing date and several attempts in May to consummate the sale, the October purchase and sale agreement expired, unconsummated, on May 25, 1984.
The non-exclusive listing agreement which Darer had entered into with Heaton on September 1, 1983, provided that:
Darer cancelled the listing agreement with the following letter, dated May 28, 1984, addressed to William D'Antonio of Heaton Real Estate, and which Darer signed as Vice President of Boulders Properties, Inc.:
"This is to advise you that I would like to cancel the Open Listing Agreement entered into by ourselves on September 1, 1983.
I would like to give you an open listing for the entire subdivision for a price of $500,000 and one for the PUD land for $3,000 a unit of (sic) 396,000.
Looking forward to hearing from you."
Neither Heaton, Stone, nor D'Antonio complied with the listing contract's notice requirement. Notification of persons with whom the plaintiffs had negotiated was not given to Darer or to Boulder Properties, Inc. within the ten days after the listing contract was terminated, nor was it given at any other time.
Throughout the summer of 1984 Darer continued negotiations with Mack and others for the financing, government approvals and land sale necessary for, and in anticipation of, the 132-unit apartment complex development. On August 31, 1984, the Boulders Partnership, a different entity than Boulders Properties, Inc., consisting of Mack, his wife and a Mr. and Mrs. Carbee as partners, purchased a large portion of the Lebanon property. Around the first of September, 1984, Stone learned of the completed land deal during a telephone conversation with Mack.
The original purchase and sale agreement between Mack and Boulders Properties, Inc. called for a purchase price of $297,000. The actual consideration paid at the closing was $380,000. The discrepancy in price is difficult to reconcile, although the parties have attempted to do so in various ways. Mack and Carbee requested and received from Boulders Properties, Inc., or Darer, the sum of $80,000 at the closing. Such sum was identified by Darer as a commission, although it is unclear for what this commission was paid, other than for buying the property, and by Mack as a reimbursement for deposits and expenditures which Mack had allegedly made in connection with engineering and site work on the property prior to the closing on August 31, 1984. Mack testified that he intentionally inflated the purchase price of the Boulders property in order to increase the amount of the refinancing loan which he would be able to obtain from a bank. After learning of the completed deal and that the defendants did not anticipate paying them a commission, the plaintiffs filed suit under the listing contract claiming their entitlement to a commission.
The defendants moved for summary judgment below, on the basis that the plaintiffs had not complied with the notice requirement of the listing contract. The superior court approved the master's recommendation denying the defendants summary judgment. The master found that as a matter of law the defendants' actual notice of the broker's negotiation with a potential buyer took the place of the written notice required by the explicit terms of the contract. Subsequent to the court's ruling the plaintiffs moved for partial summary judgment, arguing that because, as the defendants knew, they had negotiated during the term of the listing agreement with Mack, a member of the partnership which ultimately purchased a portion of the property, and because actual notice controlled the parties' dealings under the court's ruling, they were entitled to a 10% commission as a matter of law. The defendants filed a cross-motion for summary judgment, supported by Darer's affidavit, again arguing that the plaintiffs had failed to comply with the express written provisions of the contract. The Superior Court (Morrill, J.) denied both of these summary judgment motions on the ground that the defendants had already moved unsuccessfully for summary judgment on the issue of sufficient notice under the contract and thus could not have another shot at it. Also, the court found that genuine issues of material fact existed as to whether the plaintiffs were the procuring cause of the...
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