Silvertooth v. Kelley

• Decision Date: 06 July 1939
• Citation: 162 Or. 381,91 P.2d 1112
• Parties: SILVERTOOTH <I>v.</I> KELLEY ET AL.
• Court: Oregon Supreme Court

162 Or. 381

91 P.2d 1112

SILVERTOOTH

v. KELLEY ET AL.

Supreme Court of Oregon.

Argued June 7, 1939.

Affirmed July 6, 1939.

Appeal and error — Findings of court

1. In nonjury law action, findings of court are equivalent to verdict of jury.

Appeal and error — Construction of evidence

2. On appeal from judgment for plaintiff in nonjury law action, supreme court is not concerned with weight of evidence and evidence must be considered in light most favorable to plaintiff.

Brokers — Commission

3. The fact that agent selling all stock of company owning real property did not have written contract of employment did not preclude recovery of commission, since shares of stock are "personal property" even where the property of the company consists wholly of real estate.

Brokers — Commission

4. Where agent selling stock of corporation was not engaged in business of selling stock or securities and sale was an isolated sale not made in course of repeated and continuing transactions, agent could recover commission notwithstanding he did not have brokers' license to sell stock.

Frauds, statute of — Several judgment

5. Where stock was owned in severalty but agent was engaged to sell all stock, statute of frauds did not preclude rendition of several judgment against stockholders, as against contention that except as to reasonable compensation for services in connection with sale of his own stock, stockholder would be answering for debt, default or miscarriage of another or others within meaning of such statute.

Brokers — Corporate stock

6. Where sale of all corporate stock, although owned in severalty, was contemplated by various stockholders, joint and several judgment against stockholders for agent's services in procuring purchaser was proper.

Brokers — Commission — Contribution

7. If contract employing agent to sell all stock was joint, each of obligors would be liable for entire commission and, in event any of stockholders was obliged to satisfy judgment, the right of contribution would exist.

Contracts — Joint or several

8. In determining whether contract is joint or several, the intention of the parties controls.

Brokers — Contracts — Construction

9. In determining whether contract employing agent to sell all stock of corporation was joint or several, the ownership of stock in severalty was an important factor to be considered, but such fact did not conclusively refute the idea of joint obligation of stockholders.

Contracts — Joint or several

10. An obligation entered into by more than one person is presumed to be joint, and a several responsibility will not arise except by words of severance.

Brokers — Sale of corporate stock

11. Where agent was employed to sell all stock of corporation, the obligation of stockholders was joint, since the services rendered by agent were for the benefit of all the stockholders and not for the particular benefit of any one of them.

Brokers — Commission

12. Action of agent in procuring for purchaser options on certain mining properties adjacent to property owned by corporation did not preclude agent from recovering for services rendered for stockholders in selling all stock of corporation, where purchaser had informed stockholders early in negotiations that, without such adjacent claims, it would not purchase stock, and after options were secured they were never exercised, since agent was doing nothing adverse to interests of his principals.

Brokers — Reasonable value of services

13. Even if manager of company was not authorized to employ agent to sell stock of all stockholders, where stockholders knew that agent had been engaged to sell stock and accepted fruits of his industry, stockholders could not escape liability for reasonable value of agent's services.

                  Failure to procure occupational or business license or permit
                as affecting validity or enforceability of contract, note, 42
                A.L.R. 1226. See, also, 8 Am. Jur. 1076
                  12 C.J.S. Brokers, § 62b (1)
                

In Banc.

Appeal from Circuit Court, Multnomah County.

LOUIS P. HEWITT, Judge.

Action by John Silvertooth against E.W. Kelley, Harry O. Hoy (improperly pleaded as Harry G. Hoy, Jr.,) and others to recover reasonable value of services allegedly rendered in procuring a purchaser for corporate stock. From an adverse judgment, the named defendants appeal.

AFFIRMED.

Lawrence T. Harris, of Eugene (Harris & Bryson and E.O. Immel, all of Eugene, and Hoy & Prag, of Portland, on the brief), for appellants.

Irving Rand, of Portland (Galloway & Krier, of The Dalles, on the brief), for respondent.

BELT, J.

This is an action, tried by the court without the intervention of a jury, to recover the reasonable value of services alleged to have been rendered by plaintiff in procuring a purchaser for the stock of Horse Heaven Mines, Inc.

Plaintiff alleges that the defendant stockholders employed him to sell or procure a purchaser for all the stock in the above named corporation; that, pursuant to such employment, he did procure a purchaser who agreed to pay to defendants $200,000 for the stock owned by them; and that the reasonable value of his services is the sum of $10,000. The answering defendants, by separate pleadings, denied the alleged employment of the plaintiff and the reasonable value of his services. It was affirmatively alleged that, assuming plaintiff was their agent, he was not entitled to compensation for any alleged services in that he acted in conflict with the interests of his employers. This affirmative matter — to which attention will later be directed — was denied by the plaintiff in his reply.

No service could be had on the defendant R.R. Whiting, Jr., and no appearance was made by him. The action was dismissed as to the defendant D.W. Green for the reason that he had nothing whatever to do with the employment of the plaintiff or with the ratification thereof.

A joint and several judgment was entered against the other defendants in favor of plaintiff for the sum of $10,000, together with interest thereon from August 28, 1936 — date of consummation of sale of stock. From such judgment, defendants E.W. Kelley and Harry O. Hoy appeal.

The facts, briefly stated, out of which this action arose are as follows:

Horse Heaven Mines, Inc., was organized in 1934 as a corporation, having a capital stock of 75,000 shares of the par value of $1.00 per share, for the purpose of operating and developing certain cinnabar mining property about 26 miles from Antelope in Wasco county, Oregon. At the time of the alleged employment of plaintiff in April, 1935, E.W. Kelley, D.W. Green, R.R. Whiting, Isabel K. Whiting, R.R. Whiting, Jr., Harry O. Hoy (improperly pleaded as Harry G. Hoy, Jr.), Robert M. Betts (now deceased) and C.C. Hayes were the owners of all the capital stock. Thereafter, and prior to the sale in question, defendant Kelley purchased the 15,750 shares of stock owned by Hayes for $5,000, thereby becoming the owner of 53 per cent of the stock in the company.

The company soon ran into serious financial difficulties. Its application for a loan from the Reconstruction Finance Corporation had been rejected; dissatisfaction arose among the stockholders and, in March, 1935, there was much talk of selling the mine. According to the testimony of C.C. Hayes, he saw the defendant Kelley, president of the company, at Eugene, Oregon, early in April, 1935, about selling the mine and the latter said "to go ahead and sell it." Hayes further said that Kelley told him that he was agreeable to the price "Mr. Betts and the rest of us set up which I believe was $75,000." Hayes at this time was manager of the mine. While on the way back to the mine from Eugene, he saw Herbert Wilson about selling the property as Wilson had been successful in bringing about the sale of the Oregon King mine. Wilson insisted that if he was to handle the deal it was necessary to have an option. Hayes informed the defendant Kelley of such request and an option for 30 days, dated April 4, 1935, was executed by Kelley authorizing Wilson to purchase all the stock in the company for the sum of $75,000. This option was never exercised, and a few days after it terminated Hayes contacted the plaintiff in reference to the sale of the mine. The plaintiff operated a combined drug store, confectionery, and barber shop at Antelope. He was an "old-timer" in that section of the state and was well acquainted with people engaged in mining operations. Hayes testified that he told the plaintiff that Wilson had worked on the sale of the mine but that his option had expired and that he asked plaintiff if he thought "he could dispose of the mine and he said he believed he could." In this conversation there was no definite agreement as to the sale price of the mine, except that it could not be less than $75,000, but Hayes said that he told the plaintiff, "The more you can get for us the more commission there will be for you," and that he said, "What will be my commission?" and that he told plaintiff "I suppose the customary commission." Hayes said that he reported this talk with the plaintiff to the defendants R.R. Whiting and Robert Betts and that the latter said, "Go ahead." He also testified that, on two different occasions, he reported the employment of plaintiff to the defendant Kelley. The plaintiff, in testifying about this conversation with Hayes relative to the sale of the mine, said, "All the stock was to be sold and that they had to have $75,000," but that nothing was said about the sale of the stock for any particular person.

Soon after this alleged employment, the plaintiff telephoned to Sam H. Williston at Aberdeen, Washington, urging him to come to Antelope and look the property over. Williston was a representative of the Sun Oil Company which was engaged on a large scale in buying leases and cinnabar mining properties in the West. Williston was a very busy man and said that he "stalled" the plaintiff about going to...