Reynolds v. Tufts

• Decision Date: 04 December 1970
• Docket Number: No. 45656,2,3,Nos. 1,45656,s. 1
• Citation: 123 Ga.App. 147,179 S.E.2d 652
• Parties: John L. REYNOLDS v. Rutledge TUFTS
• Court: Georgia Court of Appeals

Page 652

179 S.E.2d 652

123 Ga.App. 147

John L. REYNOLDS v. Rutledge TUFTS.

No. 45656.

Court of Appeals of Georgia, Division Nos. 1, 2, 3.

Dec. 4, 1970.

Rehearing Denied Dec. 18, 1970.

Roland P. Smith, Atlanta, for appellant.

No appearance for appellee.

Syllabus Opinion by the Court

HALL, Presiding Judge.

Lessor appeals on the general grounds from the judgment awarding plaintiff-leasing agent commissions on rent paid under a new lease contract between lessor and lessee, to which the agent was not a party.

The original lease contained this provision: 'Lessor shall pay Agents, as compensation for services rendered in procuring this lease, 5% of all rentals thereafter paid by Lessee to Lessor as rent for premises or any part thereof, whether paid under this lease or not.' (Emphasis supplied.) At its expiration, lessee did not exercise his renewal option but instead negotiated a new lease directly with lessor for enlarged premises at a higher rental. No further commissions were paid to the agent.

Lessor's contentions that the original lease was not renewed, that the agency relationship was terminated, and that the agent had no part in procuring the new lease would be good reasons for discontinuing the commissions in the absence of the provision quoted above. Nevertheless, that provision clearly contemplates that as long as the two named parties maintain the lessor-lessee relationship for the described premises as shown in the original lease the agent will be entitled to continuing commissions for bringing them together initially. See Hunter v. Benamy Realty Co., 115 Ga.App. 829, 156 S.E.2d 160.

Judgment affirmed with direction that such amount as represents commissions on any premises other than those described in the original lease be written off.

BELL, C.J., and EBERHARDT, PANNELL, QUILLIAN and EVANS, JJ., concur.

JORDAN, P.J., concurs in the judgment.

DEEN and WHITMAN, JJ., dissent.

DEEN, Judge (dissenting).

There are three essentials to a binding contract, one of which is identity of the subject matter. Code § 20-107. Let us suppose that I lease a two-room apartment in a 100-apartment project under a lease such as that involved here, which specifies that I pay the agent '5% of all rentals * * * thereafter paid as rent for premises or any part thereof, whether paid under this lease of not.' When this lease expires I, as a business venture, enter into a new lease of the entire project. What do I owe the original rental agent? 5% of the two-room apartment which I now rent out to somebody else? 5% of a two hundred thousand dollar yearly gross rental on the entire project? Or nothing? In my opinion the subject matter of the lease has so changed that the contracts no longer have any relation to the other. The agent cannot collect for additional premises which he had no part in renting (in this case apparently an additional 25% more or less) and the entities are as different as though I ceased to rent one house from a lessor but did rent another house.

A reasonable construction of the phrase 'whether paid under this lease or not' can be seen in Belau v. Brown & Sons Realty Co., 122 Ga.App. 76, 176 S.E.2d 210. The owner leased to a corporation with the right to sublease, which it did. The sublessee and owner then mutually agreed to a rescission of the lease, the owner re-leased to the president of the original sublessee and he in turn re-leased back to the sublessee, who thereupon contended that the original lease had terminated and its obligation to pay rental agent fees had ceased. The court held: 'Having attempted to terminate this lease by making other arrangements to lease the premises and exclude the real estate agent, it is liable for the commissions.' In that case there was an attempt to terminate the lease, and the agent's rights with it, prior to its termination date, and...