Smith v. Lewis

• Decision Date: 20 December 1955
• Docket Number: No. 2665,2665
• Citation: 291 P.2d 804,75 Wyo. 29
• Parties: T. J. SMITH, Plaintiff and Appellant, v. C. A. LEWIS, Sr., Defendant and Respondent.
• Court: Wyoming Supreme Court

Page 804

291 P.2d 804

75 Wyo. 29

T. J. SMITH, Plaintiff and Appellant, v. C. A. LEWIS, Sr., Defendant and Respondent.

No. 2665.

Supreme Court of Wyoming.

Dec. 20, 1955.

Henry A. Burgess, Edward J. Redle, Sheridan, for appellant.

Goppert & Fitzstephens, Cody, for respondent.

HARNSBERGER, Justice.

The plaintiff Smith, a licensed real estate broker, sued defendant Lewis to recover a broker's commission for the sale of Lewis' property, basing his claim upon an express oral employment agreement and upon the value of services rendered. Judgment was in favor of Lewis, and Smith appeals, claiming the evidence was insufficient to sustain the judgment, and that as a matter of law, the evidence does not support the judgment. While recognizing the rule that under such circumstances this court will consider only undisputed evidence and evidence most favorable to the successful party together with its reasonable inferences, the appellant insists the evidence given in respondent's behalf not only fails to sustain the judgment but, in fact, supports appellant's claim. We cannot agree.

The evidence we are entitled to consider shows that Smith, a licensed real estate broker, went to Lewis representing he had people named Woosley who were interested in purchasing Lewis' property, and inquired if Lewis would sell what he called his 'Otter Creek outfit'. Lewis replied he had decided to sell if he could find a buyer at a price of $16 per acre net to him for the deeded land, not including irrigated ranches. Smith then asked Lewis to list the property with him and to give him approximately five or six weeks to make the sale. Lewis refused either to list the property with Smith or to give him any definite time in which to negotiate a sale. There was nothing said about any commission and Lewis testified he never, at any time, employed Smith or agreed to pay him any commission. The appellant also testified Lewis had never agreed to pay him a commission. Many other men had wanted to buy the property and Lewis had also told them he would sell it. Thereafter, Woosleys called upon Lewis and told him they were interested in the ranch. Either just before or right after the Woosleys' visit, Lewis received a telegram from Smith saying, in part, that he had 'priced the entire ranch' to Woosleys 'at $1.50 per acre to protect commissions'. Lewis understood this to mean that his property was being priced by Smith to the Woosleys at $1.50 per acre above the $16 net to him, and Lewis testified 'He (Smith) would have been entitled to whatever he acquired, if I sold the property to Woosleys above $16.00 an acre.'

A sale to Woosleys was finally consummated for certain of Lewis' properties which included deeded lands, leases, livestock and possibly some equipment. The uncultivated deeded lands brought Lewis $16 net per acre. During the negotiations, which continued from June through the fore part of the following January, Smith was present at some of the meetings between the parties. After the purchaser had made a down payment of $25,000, Smith for the first time told Lewis he wanted Lewis to pay him some commission. According to his testimony, Lewis responded--'I told him I didn't owe no commission, that the deal was performed, as I told him, at a certain price per acre net' and 'he better go back to the people who he said was to pay the commission'. Later, Smith wrote Lewis--'Since our meeting in Worland I have talked several times with Mr. Woosley regarding the commission on this ranch sale and he does not seem to want to pay any part of the same.' It also appears that after the down payment was made, Lewis directed Smith to help make some inventories and to get abstracts for Woosleys' attorney to examine, and that Smith made arrangements for one or two of the meetings between the parties and checked the lands.

Counsel says--'It is Smith's position that he had until July 1 to produce a buyer, and if a sale was consummated, or negotiations commenced by said date which led to a sale, he was entitled to a commission provided that the lands sold for more than $16.00 an acre.' Appellant insists the evidence to be considered shows Lewis gave Smith a definite time within which to negotiate a sale and claims it was within that time that Lewis prevented him from making a sale at a price in excess of $16 net per acre. We do not find this to be correct. Lewis testified directly that he did not give Smith a definite time within which to negotiate a sale. We must accept his statement regarding the matter.

It is our understanding that Smith contends the evidence to be examined under the rule, proved (1) that Lewis employed Smith to sell his properties and to pay Smith as commission all amounts received in excess of $16 per acre net to Lewis for the uncultivated deeded lands sold; that, in consequence, Lewis was under a duty to protect Smith's offer of the lands to Woosleys at $1.50 above that price, but, in violation of that duty, Lewis prevented Smith from selling the lands to the Woosleys at the price he had quoted by selling to them for only $16 per acre, and--(2) that after Smith informed him he wanted Lewis to pay him a commission, Lewis, by his direction to Smith respecting the inventories and abstracts, ratified Smith's agency and thus became liable for the value of Smith's services.

With respect to contention (2), we remember that when Smith first told Lewis he expected Lewis to pay him a commission, Lewis answered that Smith had better go back to the people he said were employing him. This makes it plain to us that the requests Lewis made of Smith respecting inventories and abstracts, and Smith's arranging meetings and checking lands, were as consistent with Lewis' understanding that Smith was the agent and employee of the Woosleys, as it is with Smith's contention that the acceptance of his services--after notification he was expecting a commission--amounted to a ratification of Smith's agency in Lewis' behalf. It would seem the lower court so regarded these matters, if, in fact, any doubt was entertained. In any event, the judgment of the lower court would carry with it every finding of fact necessary to support it.

As to contention (1), we might well repeat here what was said in Stevens v. Brimmer, 35 Wyo. 452, 463, 251 P. 1, 4, 49 A.L.R. 919:

'The difficulty * * * arises principally from the failure thereby to show a contract of employment, either express or implied, and that is necessary to entitle a real estate broker to compensation, unless, it may be, there should be a showing of ratification sufficient to overcome the absence of an original contract of employment.'

What we have said above eliminates any question of ratification, and we consider the evidence sufficient to warrant a finding that Lewis never employed Smith to sell his property. When a real estate broker inquires of an owner if he desires to sell his property, it is not enough to render the broker, an agent of the owner, that the owner quote a net price for which he would be willing to sell. See authorities listed under III, 43 A.L.R. 848, 849, 850. Castner v. Richardson, 18 Colo. 496, 33 P. 163. This is even more true here, where the owner positively refused to list his property with the broker and refused to give him any definite time within which to negotiate a sale. See Pierce v. Thomas, 4 E.D. Smith, N.Y., 354, quoted with approval by this court in Stevens v. Brimmer, supra. Nor does the fact that the broker finds a purchaser to whom the owner sells, entitle the broker to a commission from the owner, in the absence of the owner's employing the broker to sell property. The broker stands in no different position than any other volunteer.

Even though Lewis understood that Smith would be entitled to amounts acquired in excess of the price quoted, appellant's contention is answered by the language used in 2 Restatement of the Law of Agency, Ch. 14, § 447, p. 1049, as follows:

'If it is agreed that the broker is to have as commission only what is received by the principal above a specified net price and the principal closes with the broker's customer for a sum not in excess of such stated net price, the broker, by the terms of the offer, is entitled to no commission.'

Also see Rees v. Spruance, 45 Ill. 308, 311; Morton v. Barney, 140 Ill.App. 333, 339, 340.

If there is any doubt about the soundness of our conclusion that the evidence does not prove (1) any contract of employment (2) any ratification which entitled Smith to compensation for services rendered, still, for Smith to succeed, it was necessary that he prove he had procured a customer who was ready, able and willing to purchase at a price in excess of $16 per acre net to Lewis and that such a sale was prevented by the fraud, had faith or other fault of the owner Lewis. There is no evidence that Smith could have made a sale of the property at a price in excess of the net price quoted by Lewis. The mere fact that Smith quoted the deeded uncultivated lands of Lewis to the Woosleys at a price of $1.50 above the net amount demanded by Lewis, does not even tend to show that Smith could have induced the Woosleys to pay that price or any other price above the $16 net per acre. Certainly the Woosleys were not called upon to testify about the matter, nor was any evidence to such effect offered. See 12 C.J.S.,...