Loughlin v. Idora Realty Co.

• Court: California Court of Appeals
• Writing for the Court: RATTIGAN; DEVINE, P.J., and CHRISTIAN
• Citation: Loughlin v. Idora Realty Co., 259 Cal.App.2d 619, 66 Cal.Rptr. 747 (Cal. App. 1968)
• Decision Date: 29 February 1968
• Parties: Joseph LOUGHLIN and Frances Loughlin, Plaintiffs and Appellants, v. IDORA REALTY COMPANY, George Turkmany, Eloise Turkmany, also known as E. Mejia, and John Casserly, Defendants and Respondents. Civ. 23517.

Page 747

66 Cal.Rptr. 747

259 Cal.App.2d 619

Joseph LOUGHLIN and Frances Loughlin, Plaintiffs and Appellants, v. IDORA REALTY COMPANY, George Turkmany, Eloise Turkmany, also known as E. Mejia, and John Casserly, Defendants and Respondents.

Civ. 23517.

Court of Appeal, First District, Division 4, California.

Feb. 29, 1968.

Clarke Weigand, Oakland, for appellants.

Lempres & Seyranian, by Stanley Anthony Shulster, Oakland, for respondents.

RATTIGAN, Associate Justice.

According to the allegations of the complaint, this action arises from a fraudulent real estate transaction wherein, as a result of false representations made to plaintiffs by their real estate broker, their property was sold to the broker's mother-in-law without their knowing her identity, and was immediately sold to others at a significantly higher price. The action was brought to recover secret profits allegedly made by all defendants in the transaction, plus interest and punitive damages.

Plaintiffs Joseph Loughlin and Frances Loughlin, husband and wife, commenced the action against the broker, George Turkmany, individually and doing business as Idora Realty Company; 'Eloise Turkmany, also known as E. Mejia,' alleged in the complaint to be 'in some manner related' to Turkmany; and John Casserly, alleged to be a real estate salesman in Turkmany's employ. Four defendants--George Turkmany, Eloise Turkmany, E. Mejia and Casserly--appeared by answer. It was established at pretrial that Eloise Turkmany was George Turkmany's wife, and that E. Mejia was his mother-in-law.

After a nonjury trial the court made detailed findings of fact, in narrative form, in favor of all four defendants. The first several findings, were as follows (with some typographical changes, and with numerals added):

'(1) On or about June 7, 1961 and prior thereto plaintiffs were the owners of the real property, improved with a residence, at 5028 Webster Street, Oakland, California; plaintiffs resided in Los Angeles and said residence was rented to George Haggerty. (2) On said date plaintiff J. W. Loughlin, hereinafter referred to as Loughlin, entered the offices of defendant George Turkmany, hereinafter referred to as Turkmany, doing business as Idora Realty Company, a licensed real estate broker, and requested that said office list his property for sale and find a buyer for it.

'(3) Turkmany and his salesman, defendant John Casserly, hereinafter referred to as Casserly, were not present and in their absence Mrs. Hitchcock, a saleswoman of said firm, prepared a net sales contract for signature by Loughlin which he signed on that date. (4) Said contract provided that Loughlin granted to Turkmany and his agents, for a period of 90 days from date thereof, the exclusive right to sell and dispose of said property for the sum of $14,000 net cash to Loughlin and as compensation for the services of the broker Loughlin agreed to pay said firm all money over the said net sum for which said property may be (sic) sold.

'(5) Loughlin requested Mrs. Hitchcock to indicate on the contract that Casserly was to be credited with the listing and his name was so listed on the firm. (Sic: 'form'?) (6) Loughlin at that time informed Mrs. Hitchcock that he wanted all cash and would not accept any offer which required that he receive a note secured by deed of trust. (7) He wanted $15,000 for the property and after computing the commission of 6% To be paid to the broker he agreed to accept $14,000 net cash. (8) Neither Turkmany, Casserly nor Mrs. Hitchcock made any representation to Loughlin prior to, or at the time of the signing of the contract, regarding the value of the property or the price Loughlin should ask for it.

'(9) * * * (After June 7, 1961) * * * Turkmany and his agents attempted to sell the property for Loughlin and on or about August 14, 1961 Turkmany sent a letter to Loughlin and his wife informing them he had an all cash offer for $11,000, the property to be sold 'as is' thereby avoiding a termite inspection and any possible termite repairs. (10) Loughlin was requested to sign an acceptance to the written offer enclosed if satisfactory to him; (11) the offer was made by E. Mejia, mother-in-law of Turkmany. (12) Loughlin rejected the offer and returned the offer unsigned.

'(13) Loughlin came to Oakland on or about August 21, 1961 and talked to Casserly, stating that he would not accept any offer of $11,000; he and Casserly discussed the sale of the property further and Casserly asked Loughlin if he would accept an offer of $12,000 which would net him $11,280 cash. (14) Loughlin stated he might consider it and Casserly so informed Turkmany after Loughlin departed for Los Angeles.'

The foregoing narrative (Findings 1 through 14, inclusive) covers the evidence for the period from June 7 through the month of August, 1961. ¹ These findings reflect undisputed facts, or were made by the trial court upon conflicting evidence, and are binding upon this court in either event. Concerning some events which immediately followed in early September, the trial court next found as follows:

'(15) On September 5, 1961, Turkmany phoned Loughlin to confirm the fact Loughlin would accept $11,280 net cash and Loughlin told Turkmany he would accept such an offer. (16) Turkmany then prepared for signature by Loughlin a letter dated September 6, 1961, which was sent to Loughlin on said date for signatures of Loughlin and his wife in which they agreed to accept $11,280 net cash for the property for a total sales price of $12,000, the broker to receive $720 as a commission. (17) The buyer was E. Mejia, mother-in-law of Turkmany. (18) On September 5, 1961 Turkmany ordered a preliminary title report from Western Title Co., Order No. 626121, and (19) on September 6th informed the title company escrow officer, Joseph Lauck, that he had a buyer for the property.'

According to uncontradicted evidence, the events of early September, involving Turkmany and Loughlin, were these: On September 5, Turkmany opened an escrow at Western Title Insurance Co. under No. 626121. The title company's 'Order Blank,' a filled-in form evidencing this transaction, was received in evidence. ² The form shows that Turkmany ordered a preliminary title report, and specified title insurance in the amount of $14,000, in connection with a sale of the 5028 Webster Street property by Loughlin to Mejia. The form referred only to a 'sale' and '$14,000'; it did not mention any other amount, nor any person other than Loughlin and Mejia, nor terms, nor financing.

Thereafter, on the night of September 5 and again on the night of September 6, Turkmany telephoned Loughlin in Los Angeles. In the September 6 call, he told Loughlin that hehad a $12,000 offer for the property. Turkmany, according to his testimony, was acting as agent for Mejia in communicating the offer, but there is no evidence that he disclosed this fact to Loughlin in the telephone conversation. In response to an inquiry by Loughlin, Turkmany said that he--Turkmany--was not buying the property, but he did not say that Mejia was, nor that she was his mother-in-law.

In the September 6 telephone conversation, Loughlin verbally agreed to accept $12,000 for the property: $11,280 cash net to plaintiffs, with Turkmany to receive the $720 balance as a commission. On the same night Turkmany drafted a document dated September 6, and mailed it to Loughlin for plaintiffs' signature and return. A covering letter stated in relevant part, in Turkmany's handwriting, that 'I will proceed to open the escrow' when the signed document was returned. Plaintiffs signed the document--apparently on September 7--and mailed it back. The document, which was in letter form, stated in relevant part as follows:

'September 6, 1961

'Idora Realty Company

(address)

Attention: Mr. George Turkmany

'RE: Our real property known as 5028 Webster Street Oakland, California.

'Dear Sir:

'This is to confirm our telephone conversation of last night and the telephone conversation was had this evening that we will accept the sum of $11,280.00 NET CASH TO US for our above mentioned property. * * * (Instructions follow for payment of an outstanding indebtedness to the Bank of America and for closing the transaction). * * *

's/ Joseph W. Loughlin

's/ Frances Loughlin'

Neither Turkmany's covering letter, nor the September 6 document, identified the buyer of the property. On September 15, the title company sent a deed to plaintiffs, naming 'E. Mejia' as the buyer. They signed and returned the deed on September 16 and returned it to the title company.

The next successive findings by the trial court generally reflect these facts: Shortly following the telephone conversation of September 6, Turkmany obtained from one Azaro a commitment for a loan of up to $12,500 on the property, the loan to be made to Mejia. Soon thereafter, Turkmany negotiated a sale of the property from Mejia to the Messrs. Schennek for $16,500, but upon terms: $2,000 cash down, a $12,500 loan from Azaro to be secured by first deed of trust, and the balance to be carried by a note from the Schenneks to Mejia, to be secured by a second deed of trust.

The Mejia-Schenneks sale was placed in the same escrow (No. 626121) where the sale from Loughlin to Mejia was already pending. The entire escrow closed on September 20, with consecutive recordation of the Loughlin deed to Mejia, a deed from her to the Schenneks, and a deed of trust from the Schenneks in Azaro's favor.

The title company disbursed $11,280 to plaintiffs, less the balance of the bank loan owed on the property. Mejia received the Schenneks' note for $2,000, plus a check for about $1,200. The note and the check were delivered to Turkmany, who deposited the check in his trustee account. According to Turkmany, this account contained other funds which Mejia had accumulated by investments made through him. Turkmany also received a $720 commission from the Loughlin sale, of which he paid $360...