Pederson v. North Yakima & East Selah Irr. Co.

• Decision Date: 23 June 1911
• Parties: PEDERSON v. NORTH YAKIMA & EAST SELAH IRR. CO.
• Court: Washington Supreme Court

116 P. 279

63 Wash. 636

PEDERSON v. NORTH YAKIMA & EAST SELAH IRR. CO.

Supreme Court of Washington

June 23, 1911

Department 1. Appeal from Superior Court, King County; A. W. Frater Judge.

Action by Hans Pederson against the North Yakima & East Selah Irrigation Company. From an order allowing the claims of the Inland Realty & Investment Company and C. A. Bryant defendant appeals. Affirmed.

Blaine Tucker & Hyland, for appellant.

McClure & McClure, Aust & Terhune, and Humphries & Cole, for respondent.

GOSE J.

The North Yakima & East Selah Irrigation Company, the appellant was incorporated in January, 1908. Its object was to sell arid land, together with water for its irrigation. Its assets passed into the hands of a receiver on March 12, 1909. In September, 1908, it entered into a contract with the Inland Realty & Investment Company, a corporation, hereafter called the claimant, whereby it gave the latter the exclusive right to sell certain of its land, together with water for its irrigation. The claimant proceeded to make contracts for the sale of the land and water in harmony with its contract. At the time of the appointment of the receiver, it had made contracts of sales which, if carried out by the appellant, entitled it to commissions aggregating $25,056.67. Its claim for this amount was presented to the receiver and was, after hearing, allowed by the court. No part of this commission has been collected by the appellant. This appeal is prosecuted from an order allowing the claim.

The contract between the appellant and the claimant provided that 'first party [the appellant] is in no manner liable to second party [the claimant] for the amount due second party on the purchase price of said land, and shall be liable only for the portion of each of said purchase money installments coming to second party, as the same may be collected by the first party, and not otherwise.' It further provided that the purchasers should make the second payment upon their land and water contracts when water was delivered by the appellant in lateral ditches contiguous to the tracts sold.

The appellant contends that the court erred in allowing the claim. The evidence shows that the purchasers were able and willing to perform, and to make the payments as stipulated in their contracts, and that they did not do so on account of the failure of the appellant to deliver water to the land as it had agreed to do. The clause quoted would be controlling if the loss of the commissions was attributable to the default of the purchasers, but that is not the case before us. The claimant has lost its commissions through the default of the appellant. It has broken both the letter and the spirit of its contract, with both the claimant and the purchasers, and upon the plainest principles of right and justice it must be held responsible to the claimant for its loss. The commissions were due upon duly executed contracts of sale. The claimant's right is not defeated by the appointment of the receiver. 34 Cyc. 266; Central Trust Co. v. East Tennessee Land Co. (C. C.) 79 F. 19; Everett v. Gores, 89 Wis. 421, 62 N.W. 82; Chemical National Bank v. Hartford Deposit Co. 161 U.S. 1, 16 S.Ct. 439, 40...