Henry Broderick, Inc. v. Baker

• Decision Date: 14 February 1929
• Docket Number: 21446.
• Citation: 151 Wash. 1,274 P. 722
• Parties: HENRY BRODERICK, Inc., v. BAKER.
• Court: Washington Supreme Court

274 P. 722

151 Wash. 1

HENRY BRODERICK, Inc., v. BAKER.

No. 21446.

Supreme Court of Washington

February 14, 1929

Department 1.

Appeal from Superior Court, King County; William A. Huneke, Judge.

Action by Henry Broderick, Inc., against George B. Baker. Judgment for plaintiff, and defendant appeals. Reversed, with instructions.

Holcomb J., dissenting.

Benton Embree, of Seattle, for appellant.

Jay C Allen and John F. Walthew, both of Seattle, for respondent.

BEALS J.

Plaintiff a real estate broker, sued defendant for $5,000, claiming that amount as due it for producing a tenant ready, able, and willing to enter into a sublease of certain premises in the city of Seattle in accordance with terms outlined by defendant. The trial court rendered judgment in favor of plaintiff in accordance with the prayer of its complaint from which judgment defendant appeals.

By reason of some agreement between appellant and Mr. and Mrs. Richardson, appellant's principals and the original lessees of the premises, which it was contemplated should be sublet to the tenant to be produced by respondent, appellant assumed the burden of paying any commission which respondent might earn, and the liability of appellant for such commission, if any be found due, is not questioned. The facts giving rise to this litigation are as follows:

During the fall of 1927 negotiations between the parties to this action resulted in the writing by L. S. Duryee, who was then in the employ of respondent, of a letter to appellant, the material portions of which, as alleged in the complaint and admitted by the answer, are as follows:

'November first, nineteen twenty-seven.

'Mr. George B. Baker, Eitel Bldg., Seattle, Washington--Dear Mr. Baker: Referring to the lease between Sarah E. A. Abt and William H. Richardson and wife covering the easterly one-half of lots 10 and 11, block 26, A. D. Denny's (less a portion taken for widening Second avenue and Pike street) we understand you offer us a lease upon said property for seventy-six years from November 1, 1927, at a net rental of $36,000 per year for first fifteen years and $37,000 per year for remaining 61 years payable quarterly in advance out of which the present lessees are to take care of the ground rental to be paid to the heirs of Sarah E. Abt, to wit: Jennie Hasbrouck, a widow; Mabel Epler, a maiden lady; and Albert E. Epler, a bachelor, as set forth in that certain extension of said lessees' lease upon above described property dated September 4, 1923, and recorded in Vol. 46 of Leases at page 3, upon the condition that all other obligations under said lease shall be taken care of by the new lessees and that to secure such obligation the new lessee shall deposit with said William H. Richardson and wife the sum of $30,000 upon which interest at the rate of 6% per annum shall be allowed to be credited proportionately upon the quarterly payments of rent. The conditions of said deposit shall be that it shall remain until and when the new lessee shall have erected a new building of fire proof construction in lieu of the present building and of a size of at least as great cubical content as the present building. After the erection of such building this deposit shall be returned by crediting upon the quarterly payments of rent the sum of $1,500.00 each quarter until said deposit shall have been returned. The new lease shall have protective clauses protecting the Lessor against the removal of the present improvements until a sufficient bond has been filed guaranteeing the construction without liens of the new building and any other clauses and conditions that may be usual and should be inserted. * * *

'We shall receive as our share of a commission the sum of $8,000.00 if we produce such a lessee able and willing to take such lease and deposit the said $30,000 security.

'Prior to our producing a lessee under conditions above set forth you shall have the privilege of making a sale of your leasehold if at a price of $300,000.00 or more upon terms of at least one-half cash.

'Yours very truly,

'Henry Broderick, Inc.

'Dictated by Mr. Duryee.'

To this letter appellant replied as follows:

'November 7, 1927.

'Henry Broderick, Inc., Hoge Building, Seattle--Gentlemen: Replying to your favor of the 1st inst. relative to the subleasing of the property now leased by W. H. Richardson from Sarah A. Abt, would advise that we would be interested in making a sublease for seventy-six years from November 1, 1927, to an approved lessee, for a net rental of thirty-six thousand dollars per year for the first fifteen years and thirty-seven thousand dollars per year for the remaining sixty-one years, the ground rental to be paid by the lessors named in sublease.

'On the above sublease there will be required a deposit of thirty thousand dollars as a guarantee that all conditions of a sublease will be complied with, as outlined in your letter. When such a sublease is made and executed by all parties, the transaction completely closed and the thirty thousand dollars paid to me, a commission of five thousand dollars will be allowed.

'In my discussion with your Mr. Duryee, he figured the regular commission at $15,750.00 and that $8,000.00 would be the share you should receive, but it seems there was an error in his figures making it $15,750.00.

'An acceptance accompanied by earnest money deposit in the sum of at least ten thousand dollars must be made on or before November 15, 1927, otherwise all negotiations will be considered terminated and of no further effect.

'Yours very truly,

George B. Baker.

'Form of sublease to be substantially like that made to Gardner J. Gwinn.'

The lease referred to in this letter from appellant as having been made to Gardner J. Gwinn was a lease which had been negotiated in the year 1925 by respondent for appellant, with which lease Mr. Duryee was thoroughly familiar. In its complaint, after setting forth the letters above referred to, respondent alleged that it orally accepted the employment and endeavored to find a tenant who would enter into a sublease of the premises 'pursuant to said terms and conditions'; that thereafter one George Bartell agreed with respondent that he, alone or with some associates, would enter into a sublease of the property on the terms and conditions stated; and that thereupon respondent prepared an earnest money agreement (hereinafter referred to as the agreement), which, together with a check for $10,000, it endeavored to deliver to appellant on the afternoon of November 15, 1927. Respondent further alleged that appellant, for the purpose of cheating and defrauding respondent out of its commission, secreted himself during the afternoon of November 15 (that being the last day on which respondent, under appellant's letter, could produce a tenant and earn its commission), and that respondent was unable to find appellant on that day; that on the morning of November 16 respondent presented the agreement, together with a check for $10,000, to appellant; and that appellant refused to accept the same, stating as his sole reason for his refusal that the time limit fixed by him in his letter to respondent had expired. Respondent further alleged that thereafter appellant caused a sublease of said premises to be executed to George Bartell and his associates; that respondent had fully performed its contract with appellant and was entitled to receive the $5,000 commission mentioned in appellant's letter, above quoted.

Appellant admitted the writing of the letters pleaded, denied that respondent performed its contract within the time limited thereby, or at all, and denied all liability to respondent.

The agreement prepared by respondent and submitted to appellant on November 16, consisting of a little over five pages of typed matter, is in evidence. This agreement recites that it is entered into between William H. Richardson and wife, 'first party' (they being the original lessees of the premises and appellant's principals), appellant as second party, L. S. Duryee 'as representing a corporation to be organized,' third party, and respondent, referred to as the 'broker.' Under this agreement, as prepared by respondent, the subtenant would be obligated to pay future assessments and taxes against the property, save that the agreement specifically excepted from this obligation 'any levy that may be made on account of the Second avenue extension now proposed and the Denny Hill regrade No. 2.' The agreement referred to the 'Gwinn lease' as a general guide for the preparation of the sublease to be executed by the parties, but provided that the amount which might be spent in repairs, improvements, and alterations, without requiring the filing of a bond to prevent liens, should be increased from $2,000, as fixed in the 'Gwinn lease,' to $5,000. The agreement also contained a clause to the effect that, in case the first party therein neglected to perform their obligation in accordance with the agreement, the first party should return to the third party therein named the $10,000 deposit 'and an additional sum of $10,000 as damages to the third party.'

The trial court found that, when this agreement was submitted to appellant on the morning of November 16, appellant stated only one objection thereto, to wit, that the same was offered too late. The trial court was of the opinion that appellant, having based his refusal to accept the agreement solely upon the ground that the same was presented too late, could not thereafter raise other objections to the form or subject-matter thereof, and that as, under all the circumstances, the agreement prepared by respondent was seasonably tendered to appellant, respondent was entitled to judgment as prayed for in its complaint. The matter of whether or...