Hunter v. Benamy Realty Co., 42687

• Decision Date: 08 June 1967
• Docket Number: No. 42687,No. 2,42687,2
• Citation: 115 Ga.App. 829,156 S.E.2d 160
• Parties: E. W. HUNTER v. BENAMY REALTY COMPANY
• Court: Georgia Court of Appeals

Page 160

156 S.E.2d 160

115 Ga.App. 829

E. W. HUNTER v. BENAMY REALTY COMPANY.

No. 42687.

Court of Appeals of Georgia, Division No. 2.

June 8, 1967.

Syllabus by the Court

Where a lease contract between A, as lessor, B, as lessee, and C, as lessor's agent, provided that if the lessor and lessee subsequently entered into a new lease lessor agreed to pay the agent 5% of the monthly rental paid to lessor under the new lease, and B assigned the lease to D, and A and D entered into a new lease for a term of fifteen years, and A sold the premises to E before the expiration of the term; C was thereupon entitled to recover from A the full amount of the remainder of the commission on rentals provided by the new lease to the end of the term, reduced to present cash value.

Benamy Realty Company brought this suit against E. W. Hunter to recover damages for the breach of a contract providing for the payment of certain real estate brokerage commissions to plaintiff. Count I of plaintiff's amended petition may be summarized as follows:

Defendant, as lessor, the Deka Corporation, as lessee, and plaintiff, as defendant's agent, were parties to a contract dated September 10, 1958, by which defendant leased certain land to Deka Corporation for a term of 15 years. This contract stipulated: 'Lessor agrees to pay agent as compensation for services rendered in procuring this lease, the first full month's rent hereunder, when paid by lessee, and in addition thereto, 5% of rentals thereafter paid by lessee under this lease * * * lessor agrees if this lease is extended or if a new lease is entered into between lessor and lessee covering the leased premises, or any part thereof, then in either of said events, lessor, in consideration of agent having procured lessee hereunder, agrees to pay agent 5% of all rentals paid to lessor by lessee under such extension or new lease. Agent agrees in the event lessor sells leased premises that upon lessor's furnishing agent with an agreement signed by the purchaser, assuming lessor's obligation to agent under this lease, that agent will release original lessor from any further obligations to agent hereunder * * * 'Lessee' shall include second party, its representatives and successors, and if this lease shall be validly assigned or sublet, shall include also lessee's assignees or sub-lessees * * *'

The Deka Corporation, with defendant's consent, subsequently executed an assignment of its rights under the lease to Gillespie-Rogers-Pyatt Company, which assumed all the obligations of the original lessee.

Thereafter defendant, as lessor, and Gillespie-Rogers-Pyatt Company, as lessee, entered into a new contract by which defendant, agreeing to construct additional improvements, leased the same premises to Gillespie-Rogers-Pyatt Company for a term of fifteen years, commencing November 1, 1963 and ending October 31, 1978, at a higher rental than was provided by the original lease. Plaintiff was not a party to the latter contract, and it made no provision for commissions to plaintiff.

On August 6, 1965, defendant sold the premises to T. W. Thompson, Jr. and assigned the new lease to Thompson. Defendant has never obtained or furnished to plaintiff an agreement from Thompson assuming defendant's obligations to plaintiff under the case. Defendant has failed and refused to pay plaintiff any commissions after conveying the premises to Thompson.

Defendant's general demurrer to Count II of the amended petition having been sustained, defendant took this appeal from the trial court's judgment overruling the general demurrer to Count I.

Huie & Harland, Harry L. Cashin, Jr., Atlanta, for appellant.

Smith, Cohen, Ringel, Kohler, Martin & Lowe, Donald A. Weissman, Robert W. Beynart, Atlanta, for appellee.

BELL, Presiding Judge.

1. Defendant has expressly waived any error in the trial court's ruling on demurrer by reason of the plaintiff's failure to allege compliance with licensing requirements of an Act of 1925, p. 325, as amended, for real estate brokers and salesmen. See Code Ann. §§ 84-1401, 84-1413; Mayo v. Lynes, 80 Ga.App. 4, 6, 55 S.E.2d 174.

2. The fact that plaintiff was not a party to the new lease contract between defendant and Gillespie-Rogers-Pyatt Company will not affect the result in this case. This is an action upon the agreement to pay commissions incorporated in the original lease contract and not an action upon the new lease. See Reid v. Morrison, 31 Ga.App. 613, 614(6), 121 S.E. 860.

Nor is it material that plaintiff did not procure as lessee Gillespie-Rogers-Pyatt Company, the assignee of the original lessee. Gillespie-Rogers-Pyatt Company was a 'lessee' within the meaning of the agreement to pay commissions incorporated in the original lease contract, which provided, "Lessee' * * * if this lease shall be validly assigned * * * shall include also lessee's assignees * * *'

Thus the new lease between defendant and Gillespie-Rogers-Pyatt Company was a 'new lease' within the broad terms of the stipulation that 'Lessor agrees * * * if a new lease is entered into between lessor and lessee covering the leased premises * * * to pay agent 5% of all rentals paid to lessor by lessee under such * * * new lease.'

Plumbing Industry Program, Inc. v. Good, Fla.App., 120 So.2d 639 and similar cases collected in Ann. 79 A.L.R.2d 1063 are not applicable here. In the Good case the brokerage agreement provided for payment of an additional commission only if the lessee should exercise its option to renew or extend the original lease, not if the lessor and lessee should enter into a new lease on different terms. The term 'new lease,' used here, would embrace not only a renewal of the original lease on substantially the same terms, but a completely new agreement employing drastically different terms as well, so long as the new lease covered the same 'premises, or any part thereof.'

Defendant conveyed the premises, together with his interest in the new lease contract to Thompson, who was not bound by the commission agreement, as it was not a covenant running with the land. Goldberg v. Varner, 72 Ga.App. 673, 678, 34 S.E.2d 722. But defendant could not thus defeat plaintiff's right to its commission. Defendant himself remains bound by the commission agreement. The principles applied in Bush v. Mattox, 116 Ga. 42, 42 S.E. 240 and Miller v. Adams-cates Co., 64 Ga.App. 858, 14 S.E.2d 220 are applicable here.

In Bush v. Mattox, 116 Ga. 42, 42 S.E. 240, supra, Mattox, a lessee of convicts, employed Bush to procure someone to sublet them, and agreed to pay Bush all sums above $14 per month paid to Mattox for each convict sublet. Bush procured Sharpe, who contracted to pay Mattox $16 per capita. Subsequently Mattox, without Bush's consent, voluntarily reduced the amount from $16 to $14. In a...