Syllabus by the Court.
The
relationship of principal and agent, being confidential and
fiduciary in character, demands of the agent the utmost
loyalty and good faith to his principal. Any breach of this
good faith whereby the principal suffers any disadvantage and
the agent reaps any benefit is a fraud of such nature as to
preclude the agent from taking or retaining the benefit; also
from claiming his commissions.
[Ed
Note.-For cases in point, see cent. Dig. vol. 40, Principal
and Agent, §§ 147, 211.]
Fraud
voids contracts. Fraud sufficient to destroy the contract may
be shown by parol, though the contract be in writing.
[Ed
Note.-For cases in point, see Cent. Dig. vol. 11, Contracts
§ 420; vol. 20, Evidence, §§ 2007-2017.]
A
contract, no matter how solemnly expressed, obtained by an
agent from his principal through a violation of the loyalty
and good faith imposed by the confidential relation, is void
and, is not enforceable in law or in equity.
[Ed.
Note.-For cases in point, see Cent. Dig. vol. 40, Principal
and Agent, § 147.]
An
agent who secretly undertakes to represent both parties to a
transaction is not permitted to recover commissions from
either of them. This rule applies to real estate agents as
well as others.
[Ed.
Note.-For cases in point, see Cent. Dig. vol. 8, Brokers, §
49.]
Error
from City Court of Atlanta; H. M. Reid, Judge.
Action
by the Moore-Gaunt Company against E. A. Williams. Judgment
for plaintiff, and defendant brings error. Reversed.
Parol
evidence is admissible to show fraud and deceit in the
inception of a contract.
The
Moore-Gaunt Company, real estate agents, sued Mrs. Williams
upon the following contract: "I hereby accept the above
offer of H. D. Durr [also set out as an exhibit to the
petition] upon the terms and conditions therein named, and
guarantee the titles to be perfect, and to deliver same free
from legal incumbrance, to the purchaser, and to pay
Moore-Gaunt Co., for having negotiated the above sale, a
commission on the gross amount, as follows, viz.: 5 per cent
on the first two thousand dollars, and 2 1/2 per cent. on the
excess over the first two thousand dollars. In event the
buyer fails to pay for the property as stipulated above, then
the amount paid is forfeited and is to be kept by Moore-Gaunt
Co., as part compensation for services rendered by them in
the trade. This Sept. 29th, 1906. [Signed] Mrs. Eppie A.
Williams, Owner." They alleged that Durr offered to
consummate the trade, was ready and willing to purchase on
the terms named, but that Mrs. Williams refused to comply
with her contract to convey, and that she was therefore due
them the commissions specified in the contract. She offered
the following plea, which on demurrer by the plaintiff was
stricken by the court: "(1) Defendant says that she was
the owner of the residence known as 173 Oak street, which was
occupied by defendant and her minor children as a home. (2)
On or about the 18th day of September, plaintiff, who was
unknown to defendant, called upon her and represented to her
that she ought to sell her home; that he was in the real
estate business, and knew all about real estate matters, and
could get her a fancy price for the property if she would
just leave it to him. (3) Defendant's husband had but
recently died. She was possessed of but little means; was
earning no money from any position, and her minor children
were a source of expense to her in her efforts to obtain for
them support and education. (4) Defendant declined to sell
her home, stating that it would leave her and her children
without a home, but plaintiff strongly urged and insisted
that defendant was in debt, and that, if she could obtain a
fancy price for her home, she could pay herself out of debt,
and have something to live on. (5) Finally, having no mature
person upon whose experience she could rely for advice, and
being overpersuaded by the urgent insistence of plaintiff,
she asked him what price she ought to accept for the place,
and plaintiff advised defendant that she could not get more
than $2,500 for the property, and that it was a fancy price
for the place, and she ought to sell it at that price without
delay, in which advice defendant finally acquiesced. (6)
Subsequently Mr. H. D. Durr, who was unknown to defendant,
called upon her, and asked leave to inspect the property with
a view to its purchase, but defendant stated to him that she
did not desire or intend to sell the place, and the said H.
D. Durr left, stating that the place was too small for his
purpose anyhow. In the course of the conversation defendant
stated to the said H. D. Durr that she would under no
circumstances sell the place if she had to abandon it as a
home, and that she would only consider an offer on the
express condition that she could continue to occupy it as a
tenant. (7) After this conversation, plaintiff again called
on defendant, urging her to renew her offer of sale, and
stating that he could, without difficulty, induce the said H.
D. Durr to rent the place to defendant, so that she could
still occupy it as a home by paying rent to him. (8)
Defendant in the meantime, having obtained reliable advice to
the effect that the property was worth much more than the
amount offered to her, and that the proposed plan of selling
the property for $2,500 and renting the place from the
purchaser at the rate suggested would result in a great loss
to her, notified plaintiff that she would not sell the place,
and that any negotiations looking to its sale must be
declared off. (9) Plaintiff then exhibited
to defendant a printed contract, which appeared on its face
to have been executed on September 29, 1906, the date on
which the following transactions occurred, which contract
appeared to have been signed by H. D. Durr as purchaser of
the property referred to, and alleging that the said Durr had
on that date paid the plaintiff the sum of $25 as part
payment to bind the trade. Said date, however, being
subsequent to the revocation of defendant's agreement to
allow the sale of said place by or through plaintiff,
defendant, therefore, declined to sign the attached printed
blank, which plaintiff urged her to sign, stating that she
did not desire or intend to sell her home. (10) Plaintiff
then stated to defendant that unless she signed the attached
blank or acceptance, which was a part of the printed contract
signed by the said H. D. Durr, but which had not been signed
by defendant, she would lose her place, and that the said
Durr would take her into court, and force her to make him a
deed, because said plaintiff had accepted $25 as part of the
purchase price, and that, unless said acceptance was signed,
the court would force her to make a deed to the said H. D.
Durr, and that defendant would then, in that event, have to
pay plaintiff the real estate commissions involved in the
transaction, but that if defendant would sign the attached
acceptance, it would put her in a position where the
plaintiff could get his commissions out of the said H. D.
Durr, under plaintiff's contract with Durr, and that the
defendant would thereby be relieved of any payment to
plaintiff in the way of commissions, and that the plaintiff
could, and would, satisfy the said H. D. Durr by selling him
another piece of property equally as good, and the defendant
could therefore retain her home without being involved in any
cost or expense. (11) Plaintiff represented to the defendant
that he was very familiar with all matters connected with
real estate trades; that he was her agent in the matter; that
she had no experience in such transactions, and that she
ought to rely upon his advice to save her property and to
avoid expense for commissions; and that, if she would act on
his advice, instead of asking the advice of others, he would
save her place, and be relieved of any expense of
commissions. (12) Defendant being a woman, and having
recently lost her husband, and being distressed with the care
of her small children, and being in debt, and being wholly
inexperienced in such matters, all of which facts were known
to plaintiff, and not then being aware that plaintiff was in
fact, acting in a dual capacity as agent, also, for the said
H. D. Durr, and believing that plaintiff was acting, as he
asserted, in her behalf, and for her interests to save her
home, and to relieve her from commissions, signed said blank
form of acceptance tendered by plaintiff. (13) Defendant says
that plaintiff thereupon partially performed his undertaking
with defendant, and induced the said H. D. Durr not to insist
upon taking defendant's property at the low price he had
offered, but to purchase other property elsewhere, and said
H. D. Durr accordingly abandoned said contract of purchase.
(14) Nevertheless plaintiff then demanded and still demands,
contrary to his promise, representations, and agreement with
this defendant, that she pay the plaintiff the amount of
commissions that would have been due if said contract of
purchase had been carried out between the parties. (15)
Defendant says that said conduct on the part of plaintiff was
intended and operated to induce her to sign said acceptance,
under the belief that it would absolve defendant from
liability, instead of operating to create an obligation on
her part towards defendant, and at the time when plaintiff...
