Shannon v. Gaar, No. 46127.

• Court: United States State Supreme Court of Iowa
• Writing for the Court: GARFIELD
• Citation: 233 Iowa 38,6 N.W.2d 304
• Parties: SHANNON et al. v. GAAR et al.
• Decision Date: 17 November 1942
• Docket Number: No. 46127.

233 Iowa 38
6 N.W.2d 304

SHANNON et al.
v.
GAAR et al.

No. 46127.

Supreme Court of Iowa.

Nov. 17, 1942.

Appeal from District Court, Polk County; Loy Ladd, Judge.

Law action for damages for wrongfully conspiring to breach an oral contract whereby plaintiffs were to act as brokers for defendants Gaar in the purchase of an apartment building. Plaintiffs appeal from judgment on a directed verdict against them.

Affirmed as to appellee Shive; reversed as to appellees Gaar.

[6 N.W.2d 305]

Walter F. Maley and F. G. Ryan, both of Des Moines, for appellants.

Stipp, Perry, Bannister & Starzinger and Donald D. Holdoegel, all of Des Moines, for appellees.

GARFIELD, Justice.

Plaintiffs-appellants, both married women, are real estate brokers who were associated together in the matter in controversy. Defendants-appellees Gaar and wife own and operate a typewriter business and defendant-appellee Shive is another real estate broker. All live in Des Moines. On May 15, 1939, appellee K. W. Gaar acquired title to the Eddy Apartments in Des Moines. Appellants claim they were employed by the Gaars to act as their agents in the purchase of the property but that the three appellees conspired together wrongfully to deprive them of their commission. At the close of appellants' evidence the trial court directed a verdict against them apparently on the theory that the evidence was insufficient to sustain their claim. We will briefly review the evidence offered by appellants. Appellees offered no testimony. Appellants are entitled to have the evidence considered in the light most favorable to them.

Trustees appointed by the Polk County District Court had been ordered to sell the Eddy Apartments which were “in receivership.” Accordingly the trustees listed the property for sale with several real estate agents. $90,000 was the original asking price. About March 24, 1939, Risser, the active trustee, told appellants the property was to be sold to the highest bidder and suggested they try to find a purchaser. Appellants then made an inspection of the apartment building. They then contacted Mrs. Gaar at the Gaars' place of business in an attempt to interest them in the purchase.

Mrs. Gaar manifested considerable interest and asked appellants to get full information on the income and expense of

[6 N.W.2d 306]

the apartment. Appellants obtained from Risser, the trustee, a statement of income and cost of operation and made an appointment with him for Mr. Gaar to look over the books in Risser's office. There is evidence that Gaar conferred with Risser pursuant to this appointment. Appellants showed the statement of income and expenses to Mrs. Gaar who told them again that she and her husband were much interested. “Believe me, we are hot prospects” were her words.

The question of financing was discussed. Mrs. Gaar instructed appellants to make every effort to get a loan on the apartment. They wanted to borrow as much as $60,000 if they could. Accordingly, appellants contacted six different loan concerns. Mr. Hunter told appellants that he thought his company could loan Mr. Gaar $52,000 on the apartment and asked them to have Gaar see him at an appointed time. Appellants reported to Mrs. Gaar the result of their interview with Hunter. There is evidence that Mr. Gaar conferred with Hunter pursuant to the arrangement made with appellants.

In the course of one of the above conversations between appellants and Mrs. Gaar, it developed that appellee Shive, a real estate broker, had done some business for the Gaars. They had previously listed for sale with Shive a property of their own known as the Colonial Apartments. It also appears that the trustees had listed the Eddy Apartments for sale with Shive, among others, and that he had talked to the Gaars regarding the Eddy property before appellants first contacted them.

When Mrs. Gaar informed appellants of their previous relations with Shive, appellants offered to withdraw if the Gaars preferred to have Shive represent them in attempting to purchase the Eddy Apartments. Mrs. Gaar then said she would talk to her husband regarding the matter and report to appellants. That evening Mrs. Gaar told one of the appellants over the phone, “My husband is sitting here now and he said for you to go ahead. Shive has known all along that we wanted the Eddy Apartments and he has not tried to get them for us. He has had his chance.”

In the fore part of April, 1939, one Gulick had made an offer to buy the property from the trustees for $75,000 provided $2,500 of that amount would be paid to one Nielson, a real estate agent, who had interested Gulick. Upon learning of this offer, appellants told Mrs. Gaar about it and offered to cut their commission to $2,000. “Mrs. Gaar said she thought that would be all right.” Appellant Mrs. Shannon testified, “We told them (Gaars) we would take $2000 commission which would make them a better offer but it would have to come from them as the court paid no commission. They said it was agreeable. They thought it was nice of us to cut our commission to help make the deal.”

At about this time, appellants apparently were fearful that the Gaars would purchase the property through Shive or in some other way attempt to deprive them of their commission. They called upon Risser and at his suggestion saw his attorney, told them of their dealings with the Gaars and asked that they be protected on their commission. The Gaars learned of this move of appellants and professed that it offended them. On April 10 Mr. and Mrs. Gaar told appellants they had “made a mess of this” by seeing the attorney. Gaar asked appellants “to withdraw from this in favor of Shive” and offered them as an inducement an exclusive listing on Gaar's Colonial Apartments if they would “withdraw.” This appellants refused to do. Gaar then told appellants he was through with them and that he would “have those Eddy Apartments” without going through them, intimating that he would deal through Shive. Appellants then “dropped out of the picture.”

Two days later a hearing was had before the court on the sale of the apartments. Gulick through Nielson offered $75,000 with a deduction of a commission of $2,500. Shive made a tentative offer contingent upon obtaining a loan. The hearing was postponed for two days when on April 14 Shive made an offer of $75,500 net to the trustees without the deduction of any commission. The offer was accepted and the sale to Shive was approved. At this hearing Shive testified under oath he was purchasing the property solely for...