Roger Crane & Associates, Inc. v. Felice

• Court: Washington Court of Appeals
• Writing for the Court: SWEENEY; THOMPSON, C.J., and MUNSON
• Citation: Roger Crane & Associates, Inc. v. Felice, 875 P.2d 705, 74 Wn.App. 769 (Wash. App. 1994)
• Decision Date: 05 July 1994
• Docket Number: No. 13057-6-III
• Parties: ROGER CRANE & ASSOCIATES, INC., a Washington corporation; William Brooks, a married man, Appellants, v. James FELICE and Jane Doe Felice, husband and wife; Robert Tomlinson and Jane Doe Tomlinson, husband and wife, d/b/a Tomlinson South, Inc., Respondents.

Page 769

74 Wn.App. 769

875 P.2d 705

ROGER CRANE & ASSOCIATES, INC., a Washington corporation William Brooks, a married man, Appellants, v. James FELICE and Jane Doe Felice, husband and wife; Robert Tomlinson and Jane Doe Tomlinson, husband and wife, d/b/a Tomlinson South, Inc., Respondents.

No. 13057-6-III.

Court of Appeals of Washington, Division 3 Panel Two.

July 5, 1994.

Barry D. Ryan and Stanley A. Kempner, Spokane, for appellants.

Peter J. Grabicki, Randall & Danskin, James S. Craven and Philip J. Vandeveer, Evans, Craven & Lackie, Spokane, for respondents.

SWEENEY, Judge.

Roger Crane & Associates, Inc., and William Brooks (Crane) sued James Felice and Robert Tomlinson d/b/a Tomlinson South, Inc., (Tomlinson) for a portion of a real estate commission generated by the sale of Mr. Felice's home. The court granted Tomlinson's and Mr. Felice's motions for summary judgment, ruling that Mr. Brooks was not the procuring cause of the sale. Crane appeals. We affirm.

FACTUAL BACKGROUND

Mr. Felice entered into an exclusive listing agreement with Tomlinson South, Inc., to sell his Spokane home. The agreement provided for a 6 percent commission in the "case of a sale or exchange". A commission of 3 percent was to be paid to any cooperating selling broker. The home was listed at $595,000.

In accordance with the agreement between Mr. Felice and Tomlinson, the property was listed on the Spokane Multiple Listing Service (MLS), which provides a "facility for the orderly correlation and dissemination of listing information." Multiple Listing Service, Spokane Board of Realtors, Restated Rules and Operational Procedures (MLS Restated Rules and Operational Procedures), art. 1, § 1.1 (rev.1990). According to article 1, section 1.1 of the MLS Restated Rules and Operational Procedures, submission of a listing to the MLS is "a blanket unilateral offer of subagency ..." to other member realtors.

Mr. Brooks, a realtor with Roger Crane & Associates, had worked with Annie and Ed Chopot to find a home in Spokane since November 1990. He learned the Felice home was for sale through the MLS and in February 1991 recommended that the Chopots see it. He drove Mrs. Chopot past the Felice home but she did not like the looks of it from the outside.

Mr. Brooks convinced her to see the inside. On February 6, he called Tomlinson South to schedule an appointment to show the home to the Chopots. He arranged a viewing time, but the Chopots were unavailable. On March 6, Mr. Brooks called Mrs. Chopot to schedule the viewing of two homes one of which was the Felice home. He had arranged to have a Tomlinson agent show Mrs. Chopot the homes. On March 8 Mr. Brooks and Mrs. Chopot met a Tomlinson agent at the first of the two homes. After touring the first home, Mr. Brooks and Mrs. Chopot drove to the Felice home. The agent, however, did not meet them because he misunderstood which home Mrs. Chopot wanted to see. The Tomlinson agent had not made arrangements to show the Felice home and accordingly all agreed to reschedule the visit.

On Sunday, March 10, Walt Wolfe, a mutual friend of the Chopots and Mr. Felice, called the Chopots and told them about a home for sale. Mr. Wolfe, who is not a realtor, arranged for them to see it that afternoon. Upon arrival, the Chopots realized it was the Felice home. Mr. Chopot asked Mr. Felice if the home was listed. He said it was, but added that because he was a friend of Mr. Tomlinson he could get released from the listing agreement. The next day the Chopots saw the home for the second time. They again asked whether the home was listed and were given the same response. Although the record is unclear, they apparently did not tell Mr. Felice that Mr. Brooks had previously driven Mrs. Chopot past the house.

The Chopots offered Mr. Felice $550,000 for the home. Mr. Felice responded that the offer would be acceptable only if he could reduce the commission payable to Tomlinson. He agreed to speak to Mr. Tomlinson about the commission.

On March 12, Mr. Felice informed Mr. Tomlinson he did not want to pay a 6 percent commission on the sale because Tomlinson had not been involved in the Chopots' decision to buy the home. Mr. Tomlinson agreed to accept a reduced commission of $8,000. Mr. Felice accepted the Chopots' offer later that day. The Chopots and Mr. Felice arranged to meet to sign an earnest money agreement at Tomlinson's office the next day.

Mr. Chopot telephoned Mr. Brooks and informed him he was purchasing Mr. Felice's home. Melanie White, a designated broker for Crane, called the Tomlinson office as Mr. Tomlinson, Mr. Felice and the Chopots were meeting to sign the earnest money agreement. She told them Crane and Mr. Brooks would insist on payment of a 3 percent commission as the selling agents. The Chopots told Mr. Tomlinson and Mr. Felice that Mr. Brooks had worked with them to locate a home and had shown Mrs. Chopot the outside of Mr. Felice's home.

The sale closed without payment of a commission to Crane or Mr. Brooks. Tomlinson was paid $8,000.

PROCEDURAL HISTORY

Mr. Brooks brought this action against Mr. Felice, Mr. Tomlinson and Tomlinson South, Inc. Tomlinson moved for dismissal pursuant to CR 12(b)(6) and CR 56, asserting that Mr. Brooks lacked standing to sue because he was not a member of the MLS and therefore had no rights in the listing agreement. On May 7, 1992, Mr. Brooks filed an amended complaint, adding Roger Crane & Associates as a party plaintiff. Crane & Associates is a member of the MLS. The amended complaint alleged breach of contract, intentional interference with a contract and violation of the Consumer Protection Act.

The court concluded as a matter of law that Mr. Brooks' efforts did not rise to the level of "a procuring cause" of the sale of Mr. Felice's home. It also ruled that Mr. Brooks had no individual standing to bring suit because he neither had a contract with Tomlinson nor was he a participant under the rules of the MLS. It granted Tomlinson's and Mr. Felice's motions for summary judgment. Crane appeals.

DISCUSSION

The dispositive issue is whether there is a genuine issue of material fact that Mr. Brooks was a procuring agent in the sale of Mr. Felice's house. We hold there is not and affirm.

Standard of Review. The standard of review of a summary judgment is well settled. We engage in the same inquiry as the trial court and view the evidence in a light most favorable to the nonmoving party. Grimsrud v. State, 63 Wash.App. 546, 548-49, 821 P.2d 513 (1991); Stephens v. Seattle, 62 Wash.App. 140, 143, 813 P.2d 608, review denied, 118 Wash.2d 1004, 822 P.2d 289 (1991).

Real Party in Interest. Crane initially contends that the court erred in ruling Mr. Brooks had no standing to sue because he was not a "participant" under the MLS Restated Rules and Operational Procedures. ¹ We decline to address this assignment of error for two reasons. First, our discussion of the broader issue of "procuring cause" is dispositive. Second, Mr. Brooks was allowed to amend his complaint to join Crane in the action.

Listing Agreement Language. Paragraph 7 of the listing agreement reads as follows:

Total Commission. (Complete all applicable provisions). In the case of a sale or exchange, the total commission shall be 6% of the total selling price ...

Commission is payable if the property or any portion thereof or any interest therein is, directly or indirectly, sold, exchanged, leased or optioned within 180 days following expiration of the term hereof to any person who has examined, been introduced to, been shown or been offered the property during the term hereof; provided that such commission shall not be payable in the event of such transaction following expiration of the term hereof under a then current listing agreement with another licensed real estate broker.

Cooperating Broker's Share of Total Commission: 3% of total selling price or $__--__ (complete whichever is applicable).

(Italics ours.)

Crane argues it is entitled to the 3 percent commission because Mr. Brooks introduced the Chopots to the property during the term of the listing agreement. It misreads the contract.

The language on which Crane relies is from that provision of the listing agreement commonly referred to as the "tail". The tail provides for the payment of a commission, in certain circumstances, after expiration of a listing agreement. The purpose of such agreements is set out in Whiting v. Johnson, 64 Wash.2d 135, 140, 390 P.2d 985 (1964) (quoting Messick v. Powell, 314 Ky. 805, 236 S.W.2d 897, 27 A.L.R.2d 1341 (1951)):

real estate brokerage is a highly competitive business and it is a logical conclusion that the provision was intended to protect the agent beyond the duration of the exclusive 'agency or right' to sell the property in order that he might not be deprived of his compensation for finding and presenting a purchaser during that period should the owner sell to him. Without such protection, it would have been an easy matter for the owners to circumvent his right by postponing acceptance until the definite time had expired.

See also Clients' Serv., Inc. v. Pupo, 71 Wash.2d 610, 430 P.2d 552 (1967). The language of the tail is not at issue here; this property was sold well within the effective dates of the listing agreement. Mr. Brooks must therefore be the procuring cause of this sale to qualify for the commission. Willis v. Champlain Cable Corp., 109 Wash.2d 747, 754, 748 P.2d 621 (1988).

We are not persuaded by Crane's argument that the listing agreement is a binding presently enforceable contract because of the MLS compact among member realtors.

A listing agreement is a unilateral contract and until performance by Crane, the putative subagent, there was no obligation to pay Crane a commission. Multicare Med. Ctr. v. Department of Social & Health Servs., 114 Wash.2d 572, 584, 790 P.2d 124 (1990); Cook v. Johnson, 37 Wash.2d 19, 23, 221 P.2d 525 (1950) (unilateral contract...