Massie v. Dudley
| Decision Date | 12 June 1939 |
| Citation | 3 S.E.2d 176 |
| Parties | MASSIE et al. v. DUDLEY. |
| Court | Virginia Supreme Court |
Appeal from Circuit Court, Rappahannock County; J. R. H. Alexander, Judge.
Proceeding by R. L. Massie and another against L. H. Dudley, executor of the will of Eastham Dearing, deceased, on a claim against the estate of the deceased, for compensation for services rendered in con nection with the sale of real estate. From decree setting aside findings of a commissioner who allowed the claim, claimants appeal. Affirmed.
Argued before CAMPBELL, C. J., and HOLT, HUDGINS, GREGORY, BROWNING, EGGLESTON, and SPRATLEY, JJ.
Richards & Richards, C. W. Carter, and Walter H. Robertson, all of Warrenton, for appellants.
R. A. Mclntyre, of Warrenton, and John K. Hutton, of Suffolk, for appellee.
The question for our decision is whether a person, who is not licensed as a real estate broker under Virginia Code 1936, chapter 17SC, sections 43S9(77)-4359(91), inclusive, but who is acting under an express contract to produce a purchaser for certain real estate, for a fixed fee, may recover such compensation for services rendered in connection with negotiations culminating in the sale of that real estate to the purchaser he brings forward.
Eastham Dearing, a wealthy and prominent farmer and a resident of Rappahannock county, Virginia, died August 6, 1936, leaving a large estate. His will was duly probated, and L. H. Dudley qualified as executor.
Dearing, on April 4, 1936, had given an option to the United States of America to purchase, for the sum of $23,245, his farm in Rappahannock county, Virginia, containing 450 acres, more or less. The option was accepted in writing pursuant to its terms on June 19, 1936; but Dearing died before a deed was executed to the Government. The executor filed a bill in equity praying for the direction and guidance of the court with respect to the proper distribution of the estate among the residuary legatees, and for authority to execute and deliver a deed of conveyance to the United States of America for the above farm. Authority being given, the land was accordingly conveyed by deed dated June 16, 1937.
The cause was referred to a commissioner in chancery, who was required to take and state all accounts for the distribution of the estate, including all accounts and debts due by it R. L. Massie and W. A. Miller filed a claim before the commissioner in chancery for $1,134.75, for services rendered Dearing during his lifetime, in connection with the sale of his farm to the Government. The claim was based upon a verbal contract between Dearing and Massie, in which it was agreed that Massie should be paid for his services 5% of th'e purchase price of the property.
The executor objected to the allowance of the claim on the ground that neither Massie nor Miller having been licensed to act as real estate brokers during the time their services were performed, the contract was illegal and void, and no recovery could be had thereon. To the report of the commissioner allowing the claim, the executor excepted. The trial court set aside the finding of the commissioner. To the action of the trial court, this appeal has been allowed.
The record discloses the following uncontradicted facts:
R. L. Massie is and has been for several years commissioner of revenue for Rappahannock county. He had formerly been engaged in the real estate business, for which he had then taken out a real estate broker's license. He secured no such license after 1933, and hence had none during the period in which the negotiations hereinafter described were conducted.
Massie says that Dearing, whom he knew very well, approached him probably in 1927 or 1928, and made to him a proposition-- that if he would bring him a "customer" to whom a sale of his farm could be effected, he would pay him 5% of the sale price. There was no written contract.
Massie gives his version of his agreement and undertaking with Dearing in the following language:
It further appears that early in 1934, Miller, who had been a census taker in the Shenandoah Park Area, and who is now a postmaster in Rappahannock county, told Massie that the United States Government contemplated the purchase of some land in Rappahannock county for the Shenandoah Home Project Re-Settlement Administration. Massie immediately thought of the Dearing farm, and in return for the suggestion from Miller, agreed to give the latter one-half of any commission he should receive for effecting the sale of Dearing's farm to the Government.
Miller, who did not testify, did little or nothing towards making the sale, and his connection therewith was unknown to Dearing.
Massie promptly wrote a letter to Mr. Zerkle, the project manager of the Re-Settlement Administration, calling his attention to the availability of the Dearing farm. Dearing gave to the Government its first option for the farm in August, 1934. This was also the first time a price for the farm was stated. Several other options followed, the last being given on April 4, 1936. Massie also secured an option for the Government on his mother's farm, which adjoins that of Dearing. The Government considered both farms necessary to form a sufficient unit of acreage for its purposes, and purchased both at the same time.
Dearing was a man of advanced age, and although possessed of a large and valuable estate, had no office, no telephone, and no automobile. He largely relied upon Massie for aid and advice, especially in connection with the transaction under review.
Massie, after his letter to Zerkle and the first option given by Dearing, kept in touch with the transaction all the time, doing what he could to advance the sale of Dearing's farm. He wrote a number of letters; had frequent conferences with Dearing and with representatives of the Government, jointly and severally; took Dearing to Zerkle's office in Luray; took agents of the Re-Settlement Administration over the farm, showing them the lines; worked several days with the appraisers of the farm; and used his own automobile in making such trips, carrying both Dearing and the Government's representatives with him.
There is no denial of the time and effort which Massie claims he spent towards effecting the sale and working with both parties towards that end.
The Government was favorable towards the purchase of Dearing's farm, but had difficulty in securing what it considered a satisfactory price.
Massie and Miller do not undertake to itemize the various expenditures on their part, or the value of their respective services; they merely seek to recover a flat fee of 5% of the purchase price. They introduced evidence that a real estate broker's commission is usually 5% under similar circumstances.
Massie recalls only two conversations with Dearing during the negotiations with the Government, with reference to his compensation--one when he first dealt with the Government, and the other when the option was executed. He says that at Dearing's request, he agreed to deduct all costs of the transfer of the property from the amount upon which the compensation was based, because the option stipulated that the seller should pay the costs of recording the deed, etc. He further says that if he had thought he was not to recover the compensation agreed upon for his services, he would not have taken any interest in the sale of the land.
The plaintiffs in error contend that the performance of the services they rendered to Dearing are not covered in the Real Estate Brokers' Act, chapter 175C, under which a license is required; that if the contract for such services be in violation of the statute, it is not such an illegality as precludes a recovery for the services rendered; and that if the statute is intended to cover such services, it is invalid and void, being in contravention of the Constitution of the United States as impairing the obligation of a contract and denying due process of law. U.S.C.A. Const, art. 1, § 10; Amend. 14.
So much of the Act as is material and pertinent in this case may be set out as follows:
The first section, 4359 (77), provides:
"On and after January first, nineteen hundred and twenty-five, it shall be unlawful for any person, copartnership association or corporation, to act as a real estate broker or real estate salesman, or to advertise or assume to act as such real estate broker or real estate salesman, without a license."
The next section, 4359 (78), defines in clear terms what constitutes a real estate broker within the meaning of the Act:
Section 4359 (81) specifies the requirements for obtaining a license.
The twelfth section, 4359 (88), provides a penalty by fine and imprisonment, or both, for a violation of any of the provisions of the Act.
While Massie bases his claim upon his contract to furnish Dearing a customer for the land--a customer ready, willing and able to pay the price demanded by the owner--he contends that since he did not fix the price, nor make the sale himself, he was not a broker. By some distinction, which we are unable to follow, he further argues that such services as he rendered are not covered by the word...
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