Pearlman v. Snitzer
| Decision Date | 08 May 1924 |
| Docket Number | 22678 |
| Citation | 198 N.W. 879,112 Neb. 135 |
| Parties | ISRAEL PEARLMAN, APPELLEE, v. JOHN N. SNITZER, APPELLANT |
| Court | Nebraska Supreme Court |
APPEAL from the district court for Douglas county: WILLIAM A REDICK, JUDGE. Affirmed in part, and reversed in part.
AFFIRMED IN PART, AND REVERSED IN PART.
Charles W. Haller, for appellant.
Will H Thompson & Son, contra.
Heard before MORRISSEY, C. J., LETTON, DEAN and DAY, JJ.
It appears that plaintiff died since this action was appealed to this court. Therefore, on application of plaintiff's estate, it is ordered that the action be and it hereby is revived in the name of William Pearlman, administrator.
On and before November 4, 1914, plaintiff's decedent owned a house and lot in Omaha which he was desirous of selling. The plea is that defendant, while acting as agent under a verbal authority to procure a buyer, fraudulently induced Mr Pearlman to sign an agency contract for the sale of the property, and that, when it was sold, he withheld $ 500 of the purchase price as his commission notwithstanding the fraud.
This action was brought to recover the money so withheld. When the evidence was submitted both parties moved for a directed verdict. This submitted the case both as to fact and law to the trial judge for decision. The court, pursuant to the foregoing motions, discharged the jury and rendered judgment for plaintiff, from which defendant has appealed. A cross-appeal was filed by plaintiff from the court's disallowance of 7 per cent. interest from the date when defendant obtained the money in question until the date of the judgment.
The parties rely on section 2456, Comp. St. 1922, which provides:
"Every contract for the sale of lands, between the owner thereof and any broker or agent employed to sell the same, shall be void, unless the contract is in writing and subscribed by the owner of the land and the broker or agent, and such contract shall describe the land to be sold, and set forth the compensation to be allowed by the owner in case of sale by the broker or agent."
This statute was enacted in 1897 to meet the pressing need of real estate owners for protection against such persons as might pretend to have a verbal contract for the sale of the lands of such owners and who would not hesitate to attempt to uphold such contract by the presentation of false testimony. In brief the object of the act is to protect a real estate owner from the fictitious claim of a person who, without the owner's authority, might claim to be entitled to a commission as a selling agent. It is obvious that this meritorious act cannot be invoked for the enforcement of a contract if it is shown that fraud inheres therein.
The written contract in suit is dated November 4, 1914, and, by its terms, plaintiff gave to defendant an exclusive agency to sell the property within five days for $ 8,500 net to plaintiff, defendant to receive, as his commission for the sale, all that was realized over that sum. Immediately following plaintiff's signature, the contract concludes with these words:
Just before defendant signed the contract he told plaintiff, in answer to a direct inquiry, that he had not yet obtained a customer. But the answer did not reflect the fact. He had already obtained a customer, who had agreed to purchase the property for $ 9,000. Subsequently, upon consummation of the sale at that price, and within the specified five days, the purchaser paid to plaintiff's agent, defendant herein, as a part of the purchase price, the $ 500 which is in controversy here.
Defendant contends that he withheld the money from plaintiff on the alleged ground that he is entitled thereto as his commission pursuant to the terms of the contract. He seeks to justify his conduct on the theory that he was not plaintiff's agent until the written contract was signed by the parties, and that he was not therefore bound to disclose to his principal the $ 9,000 offer which he had already obtained for his property.
The contention cannot be upheld under any theory known to the law of real estate agency as it exists in Nebraska. In passing it may be noted incidentally, and only so, that the regular agency commission on a sale of real estate for $ 9,000, as disclosed by the record, is 5 per cent. on the first $ 5,000 and 2 1/2 per cent. on the remainder. So that it plainly appears that plaintiff's commission would amount to $ 350 if the transaction was lawful and regular in all other respects. It is therefore apparent that on the face of the record defendant's gain would approximate $ 150 over the regular commission if he should be permitted to retain the $ 500 which ...
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