Squire v. William S. Drozda Realty Co.

• Decision Date: 02 November 1926
• Docket Number: No. 19399.,19399.
• Citation: 288 S.W. 988
• Parties: SQUIRE v. WILLIAM S. DROZDA REALTY CO. et al.
• Court: Missouri Court of Appeals

288 S.W. 988

SQUIRE v. WILLIAM S. DROZDA REALTY CO. et al.

No. 19399.

St. Louis Court of Appeals. Missouri.

November 2, 1926.

Rehearing Denied November 30, 1926.

Appeal from St. Louis Circuit Court; El. A. Rosskopf, Judge.

"Not to be officially published."

Action by E. O. Squire against the William S. Drozda Realty Company, Drozda Real Estate Company, and another. Judgment against named defendants, and they appeal. Affirmed as to defendant Drozda Realty Company, and reversed as to defendant Drozda Real Estate Company.

Laughlin, Frumberg, Blodgett & Russell, of St. Louis, for appellants.

Taylor R. Young, of St Louis, for respondent.

BECKER, J.

This action to recover damages for the alleged breach by defendants of a written contract to convey to plaintiff certain real estate in the city of St. Louis, Mo., was instituted by plaintiff on February 7, 1924, against William S. Drozda Realty Company, a corporation, Drozda Real Estate Company, a corporation, and one Jesse Jackson. At the close of the case the court sustained a demurrer as to defendant Jackson. The verdict of the jury was for plaintiff and against both corporate defendants in the sum of $2,200. A remittitur in the sum of $500 was entered, whereupon judgment was rendered against both corporate defendants in the sum of $1,700, from which such defendants have appealed.

The petition alleged that on or about January 5, 1924, defendants, William S. Drozda Realty Company and Drozda Real Estate Company, were the owners of a certain parcel of real estate known as Nos. 4336-38-40 Chouteau avenue; that the title to such real estate was held by the defendant Jesse Jackson in trust for the corporate defendants; that on or about January 5, 1924, defendants, for a valuable consideration, entered into a written contract with plaintiff by the terms of which they agreed to sell and plaintiff agreed to buy said real estate for the price and sum of $9,000, $200 of which was by the Plaintiff paid in cash at the time; that plaintiff was at all times ready, willing, anxious, and able to carry out said contract, but that defendants prior to the date of the closing of said contract sold and disposed of said real estate to one James B. Mustain for the price and sum of $11,120, and since said date defendants and each of them had failed and refused to carry out said contract. Judgment was prayed by plaintiff in the sum of $2,320. The answer of defendants was a general denial.

The evidence disclosed that Drozda Real Estate Company was a holding company, and that the William S. Drozda Realty Company was the one that transacted the real estate business. William S. Drozda was the president of both companies, and his son, Clifford E. Drozda, was secretary and treasurer of both companies. Anna Drozda, the wife of William S. Drozda, was vice president of Drozda Real Estate Company, while William G. Drozda, a son, was vice president of William S. Drozda Realty Company. There were no other officers of such companies, and joint offices were maintained at 4006 Chouteau avenue. Jesse Jackson was a colored man 75 years of age, who was employed as janitor by Mr. Drozda.

For some years the property at 4336-38-40 Chouteau avenue had been owned by Alfred F. Shasserre and Clara Shasserre, his wife, who resided in the state of California. The testimony of the Shasserres was that in 1919 they had listed this property with Mr. Drozda and the realty company for the purposes of sale and the collection of rents. In the latter part of October, 1923, a telegram was sent by William S. Drozda to the Shasserres offering them $3,000 net for their equity in the property. It appears that the property was incumbered by certain deeds of trust, and that the proposal of Drozda contemplated a sale of the property for $8,500. The Shasserres thereupon wired Drozda accepting his offer of $3,000 net to them. On November 5, 1923, Mrs. Shasserre received a letter signed by William S. Drozda, inclosing a check for $100, drawn by William S. Drozda Realty Company. The letter stated that such check was inclosed as earnest money on the sale of the property. This check was cashed immediately and placed to the credit of Shasserres in their bank. During the latter part of December, 1923, a letter was received by Shasserres from William S. Drozda Realty Company, and inclosed in the letter was a warranty deed naming Jesse Jackson as grantee. This deed had been prepared by Clifford Drozda at the direction of his father. The Shasserres had never heard of Jesse Jackson before. The letter stated that, when the deed was signed by the Shasserres and returned to Drozda, a check for $2,592.35 would be sent them. In reply Shasserres wrote William S. Drozda Realty Company that they would not sign the deed under such conditions, for the reason that the statement of the amount to be due them was not in accordance with the terms originally offered as the price of the property. On January 5, 1924, they received a second letter from William S. Drozda Realty Company advising that an additional allowance would be made so that they would receive the full sum of $3,000. Accordingly, on the same day, the Shasserres signed and acknowledged the warranty deed and requested their bank to forward it to St. Louis for collection in accordance with the terms of the statement. The Shasserres did not pay any real estate commission on the transaction.

On January 5, 1924, plaintiff, who was desirous of purchasing some real estate, appeared at the office of the respective Drozda companies, and, after some negotiations with William S. Drozda, turned over to the latter a check for $200 made payable to "William S. Drozda Company" and received therefor the following earnest money receipt:

                         "Receipt for Earnest Money
                               "St. Louis, Mo., Jan. 5, 1924
                

"Received of E. O. Squire the sum of two hundred 00/100 dollars as earnest money and part purchase money for a certain parcel of improved property, lying in the city of St. Louis, state of Missouri, in city block No. 5114, and having a front of 50 feet on the south side of Chouteau ave. by a depth of 125 feet to alley and improvement known as Nos. 4336-38-40 Chouteau ave. 6 family flat, which property is this day sold to him for the total sum of nine thousand 00/100 dollars, payable as follows: * * *

"This sale under this contract to be closed on or before February 5, 1924, at the office of Wm. S. Drozda Realty Co., and if not closed by that time, owing to the failure or neglect of the purchaser to comply with the terms herein, the above-mentioned earnest money is to be forfeited to seller, but such forfeiture shall not release said purchaser herein from any liability' for the fulfillment of this contract of sale, or the payments of money herein mentioned, if said seller shall elect to enforce fulfillment of the same.

"This sale under above terms and conditions is made subject to the approval of the owner of this property. Wm. S. Drozda Realty Co. Seal], by Wm. S. Drozda, Prest., Agent.

"Accepted on above terms and conditions. E. O. Squire [Seal], Purchaser.

"Accepted on above terms and conditions. ______ [Seal], Owner."

There is no dispute that at the time of entering into the above contract, plaintiff understood that William S. Drozda Realty Company was agent for an undisclosed principal. Plaintiff's check was indorsed by and deposited to the credit of Drozda Real Estate Company on January 11, 1924. No witness, however, was able to explain the reason for such company's indorsement upon it.

In due course the deed from Shasserres with draft attached arrived at the National Bank of Commerce in the city of St. Louis, and on January 14, 1924, the draft was paid and the deed delivered to Clifford Drozda. The testimony of Clifford Drozda was that the draft was paid by a check of Drozda Real Estate Company. Mr. Edgar W. Zell, an employee of the National Bank of Commerce, testified, however, that the records of such bank disclosed that William S. Drozda Realty Company paid the draft.

On January 15, 1924, an earnest money receipt signed by William S. Drozda Realty Company, agents, was given James B. Mustain, who, the evidence disclosed, was acting as straw man for Floyd A. Johnston Real Estate Company. This receipt showed that Mustain had paid the sum of $200 as earnest and part purchase money for the Chouteau avenue property, and that the total consideration of the sale was the sum of $10,500. On January 18, 1924, Jackson conveyed this property by warranty deed to Mustain, such deed having also been prepared by Clifford Drozda under the direction of his father. Jackson testified that he was asked to sign the deed by Clifford Drozda, that he knew he was acting as a straw man, but did not know for whom, and that he had never served in such capacity before the time of this transaction. The check covering this transaction was issued to William S. Drozda Realty Company. No commission was paid by Jackson on the sale.

During the month of January, 1924, plaintiff called on several occasions to ascertain from Drodza whether the contract of sale had been approved by the owners of the property. Finally, on January 31, 1924, he was informed by Drozda's bookkeeper that the sale had not been approved. On February 2, plaintiff finally obtained a conference with Drozda and was informed by him that the parties in California had sold the...