Sorenson v. Smith

• Decision Date: 11 February 1913
• Citation: 129 P. 757,65 Or. 78
• Parties: SORENSON v. SMITH.
• Court: Oregon Supreme Court

129 P. 757

65 Or. 78

SORENSON v. SMITH.

Supreme Court of Oregon

February 11, 1913

Appeal from Circuit Court, Multnomah County; C.U. Gantenbein, Judge.

Action by N.V. Sorenson against Charles A. Smith. From a judgment for plaintiff, defendant appeals. Reversed and dismissed.

This is an action by Mrs. N.V. Sorenson against C.A. Smith to recover $15,000 as broker's commission for services alleged to have been performed by her husband and assignor George Sorenson, in procuring purchasers who entered into a valid contract with the defendant, whereby they stipulated to pay him $300,000 for his interest in real property in Douglas county, Or. The cause, being at issue, was tried, resulting in a judgment for plaintiff as demanded in the complaint, and the defendant appeals.

R.R. Giltner and A.H. Tanner, both of Portland (Giltner &amp Sewall, of Portland, on the brief), for appellant.

Martin L. Pipes, of Portland (George A. Pipes, of Portland, on the brief), for respondent.

MOORE J. (after stating the facts as above).

It is maintained that errors were committed in denying a motion for a judgment of nonsuit when the plaintiff had introduced her evidence and rested, and in refusing to direct a verdict for the defendant, when the cause was finally submitted. There has been brought up a transcript of the entire testimony which will be examined with reference to the application for an instructed verdict, since that request necessarily supersedes the motion for a judgment of nonsuit. The facts are that the defendant was the owner and holder of certificates issued by the Northern Pacific Railroad Company for 7,480 acres of timber land in township 27 south, of range 2 west, of the Willamette meridian. Smith, who it appears resided in Minnesota, employed F.A. Kribs, a real estate broker of Portland, Or., to negotiate a sale of his estate in the premises, which interest will be designated herein as lands. Kribs informed George Sorenson, who was engaged in the same business in that city, that these lands were for sale, and gave him a map on which the real property was represented. The plaintiff's assignor thereupon procured J.O. Storey, who on September 28, 1906, was granted by Kribs an oral option of 60 days within which to purchase the premises at $25 an acre, on account of which he was to have paid $50,000 before the expiration of that limit, and the remainder at stated intervals. The time thus specified was allowed in order to permit an inspection of the quantity and quality of the timber growing on the real property so as to determine its value. After a partial examination, Storey was reasonably satisfied that the lands were worth the sum demanded; but, being unable to secure a complete cruise of several subdivisions of the tract within the time limited, he obtained from Kribs an extension for that purpose until December 15, 1906. In the meantime, Storey had engaged to sell the lands for $250,000 to other persons, in whose interests he on December 9, 1906, offered to pay Kribs $10,000 as evidence of good faith, but the proposal was declined. At the expiration of the time ultimately limited, but before a complete inspection of the timber could be made by Storey, and without his offering to pay the $50,000 required, Kribs, at the defendant's direction, withdrew the lands from sale, and so notified Sorenson and Storey. The latter on July 7, 1907, commenced an action against Kribs in the circuit court of the state of Oregon for Multnomah county to recover $63,000 as damages for an alleged breach of the agreement to sell and convey the land, and the further sum of $2,027 as expenses incurred in cruising the timber.

A written contract was prepared at Minneapolis July 23, 1909, whereby the defendant, in consideration of $300,000, to be paid as specified, stipulated to sell and assign all his interest in the real property to C.P. Bratnober of that city, and the Storey-Bracher Lumber Company, an Oregon corporation, of which J.O. Storey and G. Bracher were respectively the president and secretary. This contract, referring to the purchasers and to the defendant, contained a clause as follows: " The vendees agree to save the vendor harmless from any claim or demand on him by any one save and excepting Frederick A. Kribs of Portland, Or., for commissions in the sale of the certificates hereinbefore mentioned, and also agree to save the said Frederick A. Kribs harmless from any claim or demand made by any one on him for commissions on account of the sale of said certificates." This contract was executed by the several parties to it at Albany, Or., September 2, 1909. Thereafter Sorenson assigned his claim for a commission of 5 per cent. of the stipulated purchase price to the plaintiff, who instituted this action, which eventuated as hereinbefore narrated.

George Sorenson testified, in substance, that after December 15, 1906, pursuant to Kribs' promise to pay him a commission of 5 per cent. of the purchase price of the land, if a profitable sale thereof could be made, he continued to negotiate with Storey until July, 1909, when Kribs said to him, " If you can get Storey to give $300,000, I can put the sale through," declaring, however, that Smith should be personally consulted about the matter. This information was communicated to Storey, who immediately went to Minneapolis, where the terms of the contract were settled. Sorenson admitted he never conversed with the defendant until after the sale was consummated; nor did he have any writing authorizing him to procure a purchaser of the lands or promising to pay him a commission in case of a sale. This testimony was corroborated in many particulars by that of F.A. Kribs, who was asked, in reference to Sorenson's efforts, originally to procure Storey as a purchaser, " You acted upon your general authority from Mr. Smith to sell the land?" He replied, " Yes, sir." After this answer was given, defendant's counsel said, " Now, if the court please, I object to that question." A ruling was then made as follows: " The objection is sustained." In obedience to a subpoena duces tecum, Kribs produced and identified copies of letters which he had written to the defendant, and also telegrams which the latter had sent to him. These writings, having been received in evidence, show that, before the final bargain for the sale of the land was concluded, Smith knew that Sorenson claimed a commission for the services which he had performed.

J.O. Storey, referring to the visit at Minneapolis to confer with the defendant in July, 1909, testified as follows: " We had agreed on the negotiations for this land, and Mr. Sorenson, who was working with me at that time to get this land in our hands in some shape so we could jointly sell it again, telegraphed me and asked me what shape I had it, and replying I wired: 'Have Smith deal cinched. What can you get? Answer.' " Referring to that message, he said: " What I meant by that was, How much money can you get for the land?" This witness further said that the Storey-Bracher Lumber Company paid no money for the lands, and had no interest therein, except the right to sell the premises; that Mr. Bratnober agreed to buy the property and allow us to sell it; but that neither Sorenson nor himself was able to find a purchaser at the price demanded. Storey received a letter written December 9, 1906, by Sorenson, wherein the writer, referring to Kribs and to the original option to purchase the lands, said: " He wanted to divide the commission with me and leave you out of the deal. I told him you was in on the deal, and that you was to get an equal division."

The foregoing is deemed to be a sufficient statement of all the material evidence involved in a consideration of the question whether or not, under the original option to sell the property, or by subsequent ratification, Smith became liable to Sorenson for the payment of a commission. It will be remembered that the defendant, a nonresident of Oregon, appointed F.A. Kribs, a real estate broker of this state, to sell lands therein. If Kribs had been a nonresident of Oregon, and Smith had known that he did not expect to come into the state, it might reasonably have been concluded that the selection of the agent, under such circumstances, carried with it, by necessary implication, the right to delegate his authority to a subagent. The modification of the general rule in this respect is founded on the assumption that, since the person originally appointed to negotiate a sale of land cannot, by reason of his nonresidence, be expected to visit and inspect the real property, he must of necessity select in his stead some one who can identify the premises to a prospective purchaser. Eastland v. Maney, 36 Tex.Civ.App. 147, 81 S.W. 574. This principle, however, can have no application to the case at bar, since Kribs resided in the state where the land is situated.

It will also be kept in mind that Kribs originally allowed an option of 60 days, and further extended the time in which the timber might be inspected. The privilege thus granted implies a bestowal of power, the exercise of which evidences a personal trust and confidence that, in the absence of express authority, negatives a right to appoint a subagent, for a performance of whose services the principal would be liable. Story, Agency, §§ 12, 13; 1 Am. & Eng.Ency.Law (2d Ed.) 972. From a careful examination of the entire evidence, it is believed that Sorenson was only a subagent, and that no privity existed between him and the defendant. This conclusion seems to be confirmed by Sorenson's letter to Storey, wherein he stated that Kribs wanted to divide with the writer the commission, and to exclude Storey from any participation therein. The statement in the letter that Sorenson had...