Phinizy v. Bush
| Decision Date | 14 November 1907 |
| Citation | 59 S.E. 259,129 Ga. 479 |
| Parties | PHINIZY v. BUSH. |
| Court | Georgia Supreme Court |
Syllabus by the Court.
The general rule is that, where an owner of property employs a broker to procure a purchaser, in order to earn his commissions, the broker must procure a purchaser who is able ready, and willing to buy, and who actually offers to buy, on the terms stipulated by the owner.
[Ed Note.-For cases in point, see Cent. Dig. vol. 8, Brokers, §§ 75, 76.]
Under the general rule stated above, ordinarily the burden of showing all the requirements recited is on the broker, in a suit by him for commissions; but, if the customer procured by the broker is accepted by the principal, the burden will be upon the latter to show that such purchaser was not able to comply with the contract, if he relies on that defense.
[Ed Note.-For cases in point, see Cent. Dig. vol. 8, Brokers, § 105.]
Sometimes under his employment, the broker's duty is not merely to procure a purchaser, but to perform some other agreed service within a reasonable time, or within a limited time. In such cases the general rule as to what is required of him in order to be entitled to commissions is modified accordingly.
A contract may be closed by a letter or telegram, and become binding; but, if it is claimed that a seller has become bound by an acceptance of his offer by the buyer, such offer must be accepted unconditionally and without variance.
[Ed Note.-For cases in point, see Cent. Dig. vol. 43, Sales, § 41.]
If a broker undertakes to accede to a modification of the contract contained in the offer of the seller, the latter may repudiate his conduct and decline to be bound, or he may ratify the act of the broker and be bound by the change.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 8, Brokers, § 66.]
If a seller has become indebted to his broker for a fixed amount of commissions, an agreement made afterwards to accept less than the amount of the debt in discharge thereof will not operate as an accord and satisfaction of such indebtedness, unless actually executed by the payment of the agreed amount, or the giving of additional security, or the substitution of another debtor, or some other new consideration.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 1, Accord and Satisfaction,§ 60.]
But if a broker had a limited time within which to effect a sale, and failed to do so within that time, and the principal declined to be bound further by the offer, but subsequently the broker sought to have him again consent to make the sale, and, in order to induce him to do so, agreed to charge less commissions than those contemplated in the original authority, and thus procured the seller to consummate a sale, the commissions of the broker would be determined under the new contract as to them, and not under that originally made.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 8, Brokers, § 56.]
Generally the form in which an agent acts is immaterial. If the principal's name is disclosed, and the agent professes to act for him, it will be held to be the act of the principal.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 40, Principal and Agent, §§ 458, 459.]
An agent may expressly contract on his own credit, and be bound, even though his principal be known.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 40, Principal and Agent, § 468.]
Omitting cases of contracts under seal, negotiable instruments, and those where there is an express declaration in writing of an intention and agreement on the part of an agent to be individually bound, usually where the agent contracts in his own name, but his principal is known, the question as to whether the principal or the agent individually is bound is one of fact.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 40, Principal and Agent, § 721 1/2.]
The case was a close one on the evidence, and there were several inaccuracies in the charge which require a new trial.
Error from Superior Court, Richmond County; H. C. Hammond, Judge.
Action by W. E. Bush against Leonard Phinizy. Judgment for plaintiff, and defendant brings error. Reversed.
An agreement by a creditor to receive less than the amount of his debt cannot be pleaded as an accord and satisfaction, unless it be actually executed by the payment of the money, or the giving of additional security, or the substitution of another debtor, or some other new consideration.
Bush sued Phinizy for commissions as a broker, and recovered a verdict. A new trial was refused, and the defendant excepted. A number of stockholders in the Augusta Railway & Electric Company entered into a pooling arrangement in December, 1902, not to sell their stock for less than 50 cents on the dollar of its par value. The firm of Martin & Bush were designated as trustees to carry out the plan. The firm was dissolved, and Bush alone continued to act. Phinizy had 70 shares of stock covered by the pooling agreement. Martin & Bush had a number of shares. Bush and Phinizy both continued to buy stock until each of them had quite a large number of shares outside of the agreement. Altogether Phinizy had 445 shares. The Augusta-Aiken Railway & Electric Company had purchased a majority of the stock in the Augusta Railway & Electric Company. Jackson was a director in the former company. Bush was a stockbroker. On November 7, 1903, Bush submitted to Phinizy for his examination the following letter:
Whereupon Phinizy wrote Bush the following letter:
Bush then delivered to Jackson his letter, and also a letter stating that, "in accordance with our conversation of this morning, I beg to advise you that the stock of the Augusta Railway & Electric Company represented by me and referred to in my letter of yesterday is as follows"-setting out the names and numbers of shares held by each owner. Jackson went North to consult his principals, and on November 17th he sent to Bush the following telegram:
The bonds of the Augusta-Aiken Company were in the hands of trustees in Baltimore. They declined to certify such bonds for the purpose of buying an option, and Bush and Jackson had negotiations with a view to changing the proposed trade so as to sell the stock itself on a credit, with the bonds as collateral security. On November 21, 1903, the board of directors of the Augusta-Aiken Railway & Electric Company passed the following resolution:
"Resolved, that Mr. James U. Jackson, in behalf of the August-Aiken Railway & Electric Company, be authorized to negotiate the purchase of 1,154 shares of the capital stock of the Augusta Railway & Electric Company, represented by Wm. E. Bush, and such additional stock as may be acquired other than that held by the General Electric Company, upon the following terms: $50 per share, payable 12 months from January 2, 1904, for which the company will give its negotiable note, with interest at the rate of 7 per cent. per annum, secured by the collateral trust 5 per cent. bonds of this company at 40 per cent. of the par value of the same."
On November 30, 1903, Bush wrote Jackson the following letter:
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