Sakelaris v. Mayfair Realty, Inc.

• Jurisdiction: Oregon
• Parties: Chris SAKELARIS, d/b/a Sakelaris Realty, Appellant, Cross-Respondent, v. MAYFAIR REALTY, INC., an Oregon Corporation, Respondent, Cross-Appellant, and Jack Armstrong, Respondent. TC A 7603 03651; SC 25336.
• Citation: 588 P.2d 23,284 Or. 581
• Court: Oregon Supreme Court
• Decision Date: 19 December 1978

Page 23

588 P.2d 23

284 Or. 581

Chris SAKELARIS, d/b/a Sakelaris Realty, Appellant, Cross-Respondent, v.MAYFAIR REALTY, INC., an Oregon Corporation, RespondentCross-Appellant and Jack Armstrong, Respondent.

TC A 7603 03651; SC 25336.

Supreme Court of Oregon, Department 2.

Argued and Submitted July 14, 1978.

Decided Dec. 19, 1978.

Robert L. Kirkman, Portland, argued the cause for appellant, cross- respondent.With him on the briefs were Carlton D. Warren, Solomon, Warren, Killeen & Kirkman, Portland.

Allen Reel, Portland, argued the cause for respondent, cross-appellant and respondent Armstrong.With him on the brief were Garr M. King, Kennedy, King & McClurg, Portland.

Before HOLMAN, P. J., and TONGUE, BRYSON and LINDE, JJ.

LINDE, Justice.

Plaintiff, a real estate broker, brought an action against the corporate defendant and its president, another broker, alleging as one cause of action the breach of a contract to divide a sales commission and, as a second cause of action, tortious interference with plaintiff's contractual rights against the seller in the same transaction.The trial court granted defendants' motion for nonsuit on the tort claim and, at the end of the trial, directed a verdict for plaintiff on the contract claim for the disputed share of the commission.From the resulting judgment, plaintiff appeals with respect to the nonsuited tort claim and the denial of his claim of attorney fees under the contract.Defendant Mayfair Realty cross-appeals with respect to the directed verdict on the contract claim.

The events leading to the dispute involve a number of individuals.Except where noted, the facts are not disputed.DefendantJack Armstrong was half-owner and president of defendantMayfair Realty, Inc., which employed Robert Crockett and George Neidhart as salesmen.The transaction giving rise to the disputed commission was the sale of a home owned by Mrs. Eugenia Hubbard to Mr. and Mrs. Bruce Craft.Mrs. Hubbard had given power of attorney to her grandson, Arthur Lewis.In May, 1975, Lewis met with Crockett and gave Mayfair an exclusive listing of the Hubbard property until July 22, 1975.Under the agreement, Mayfair was to receive a ten percent commission if it found a buyer who purchased the property during the life of the agreement or within 90 days of its expiration.Mayfair's advertisement attracted the attention of the Crafts, and Mr. Neidhart, Mayfair's salesman, showed them the property.The Crafts had listed their own home for sale with plaintiff's company, Sakelaris Realty.They asked plaintiff to help them arrange a trade with Lewis rather than an outright purchase, and Neidhart and Sakelaris met at the Craft home to see if this could be accomplished.According to Mr. and Mrs. Craft, Neidhart proposed to Sakelaris that Mayfair and Sakelaris "co-op", that is to say, divide the commission on the proposed transaction, and Sakelaris agreed.Neidhart prepared a proposed contract of exchange, but Lewis rejected the proposal on July 22.On the same date, the Crafts succeeded in selling their home through Sakelaris and now asked him to assist them in purchasing the Hubbard home.Sakelaris called Crockett to ask if Mayfair would "co-op" the commission on the Hubbard sale and Crockett agreed to do so, as both Crockett and Armstrong testified, without, however, knowing that Sakelaris intended to present an offer by the Crafts.When Sakelaris subsequently did present their proposed earnest money agreement offering $34,000 for the Hubbard home, Crockett expressed surprise at the identity of the purchasers and suggested that the split of the commission might require the decision of Mayfair's president, Armstrong.The testimony conflicts whether the plaintiff was expected to call Armstrong about this question or Armstrong the plaintiff; in any event, no such call was made.

Eventually, after Lewis had rejected this initial purchase offer, Sakelaris on July 25, 1975, prepared and the parties signed a second earnest money agreement for the sale of the property for $35,000.In the space on the printed form provided for the broker's name, plaintiff wrote: "This is a co-op Mayfair/Sakelaris Realty 55/45 split.By Bob Crockett/C. Sakelaris."In a final part of the printed form providing for the "Seller's Closing Instructions," Lewis agreed "to pay forthwith to the above named broker a commission amounting to $ 3500.00 for services rendered in this transaction."Plaintiff forwarded the completed contract to Mayfair Realty for closing.

Upon receiving this agreement, Armstrong prepared "Broker's Escrow Instructions" to the escrow agent, Transamerica Title Company.His instructions directed the escrow agent to pay Mayfair Realty, Inc., the real estate commission of $3,500, with a second notation that the commission was to be paid "To MAYFAIR" added in handwriting.Subsequently, the seller's escrow instructions directed Transamerica to pay the commission to "Mayfair Realty, per their letter of instruction."When Transamerica completed the closing on September 11, 1975, it accordingly paid the entire commission to Mayfair, and the present litigation followed.

The contract claim.Plaintiff alleged the contract said to have been breached by defendants in the following terms:

V

On or about July 25, 1975, Plaintiff and Defendant agreed to cooperate in the sale of the Hubbard property to Mr. and Mrs. Craft for the purchase price of $35,000.00, which said contract was in writing and provided for $7,000.00 down and the balance of $28,000 to be paid at closing in cash by reason of a loan to be secured by the said parties Craft.

VI

Under the terms of said agreement, the Seller Hubbard agreed to pay brokerage commissions in the total sum of $3,500.00, which said commissions were agreed between all of said parties to be paid 55% To DefendantMAYFAIR and 45% To Plaintiff SAKELARIS, at closing.

It further alleged that the sale was consummated, the entire commission was paid to defendants, that defendants refused to pay any part of the commission to plaintiff, and that plaintiff was entitled to $1,575 plus interest.Defendants' answer denied any agreement to split the commission and pleaded certain affirmative defenses.There is no dispute that defendants retained the entire commission.

Trial was conducted before a jury.At the end of the trial, the court granted plaintiff's motion for a directed verdict against Mayfair on this cause of action apparently on the theory that as a matter of law, Mayfair's processing of the transaction between the seller and the buyers constituted an acceptance on its part of the "co-op" terms plaintiff had written into the earnest money agreement.It is clear that the court did not rely on an oral agreement between plaintiff and Mayfair's agents.¹Defendants argued that no such acceptance could be implied, since Mayfair had an independent obligation to the parties to carry out the sale irrespective of its own concern with the commission.However, the court ruled that "Mayfair Realty, by its actions, accepted, ratified, or confirmed that agreement as between Sakelaris and Mayfair," and that "if they weren't going to accept it, they had to reject it and do so with reasonable dispatch and that was not done."

Mayfair's total course of conduct, after knowledge of plaintiff's cooperation in the transaction and claim to share in the commission, may perhaps give rise to an implied acceptance of the "co-op" arrangement as a matter of fact, but it does not do so as a matter of law.No express assent on...