Opinion
No. 27068.
September 24, 1928.
1. PRINCIPAL AND AGENT. Agent doubly employed cannot recover commission against party in ignorance thereof.
Where double employment exists without knowledge of parties, there can be no recovery of commission by agent against the party kept in ignorance.
2. BROKERS. Broker as middleman may collect commission from both parties.
A broker who merely acts as middleman to bring parties together who make their own trade may, in the absence of fraud, collect commission from both.
3. BROKERS. Broker, procuring owner to list land and effecting exchange for other property listed with him, held not entitled to commission from owner without knowledge of double employment.
Broker procuring owner to list property with him as agent and subsequently effecting exchange of property for other property listed with him for sale held not entitled to recover commission for sale thereof against owner who had no knowledge of dual capacity in which broker was acting.
APPEAL from circuit court of Harrison county; HON.W.A. WHITE, Judge.
H.H. Evans, for appellant.
There is absolutely no agency shown to exist between the appellee and appellant, for the sale or transfer of appellant's property. The only place in the record showing any implied agency is the testimony of Mr. Ryker that Mr. Hays listed the property in question with him for the sum of ten thousand dollars and certainly in cash in the absence of an agreement or any deferred payments. In 4 R.C.L. 298, sec. 43, the law is plainly laid down as to the agency of a broker. See 10 L.R.A. 103, 12 L.R.A. 395.
We concede that an agent may act for both if it is clearly shown that each employer has full knowledge of all the circumstances connected with the employment by the other and assented to the duplicate agency. We submit that wherever an agent attempts to justify his conduct by reason of duplicate agency, the burden of proof is upon him to establish the fact that both of his employers had full knowledge of such agency.
Appellee contends that he is entitled to a fee on quantum meruit, which is our understanding of the theory where a person employs, by valid contract another to work for him without any agreement as to compensation, the law implies a promise to pay for the services as much as they may deserve or merit; in this case there was not and cannot be any valid contract or employment and certainly no contract expressed or implied for the compensation especially in face of the proof in this case. See Walker v. Osgood, 93 Am. Dec. 168; Rupp v. Sampson, 77 Am. Dec. 416; Farnsworth v. Herman, 79 Am. Dec. 756. J.L. Taylor, for appellee.
The law is well settled that a real estate agent can recover for his services on the quantum meruit basis. See Delta Pine Land Co. v. John P. Wallace, 83 Miss. 856.
There was, in the case at bar, a contradiction as to the facts, whether or not the property was listed with Mr. Ryker by Mr. Hays for sale, and if Ryker was the agent of Hays; but the court found that the property was listed with Mr. Ryker and that Mr. Ryker was the agent of Mr. Hays; so that this matter is determined as a fact by the court on contradictory evidence and we assume would not be disturbed here unless manifestly wrong; so that the statement of authority in 4 R.C.L. 298, sec. 43, made by counsel for appellant is of no avail, for the reason that it has been found as a fact that Ryker was the agent of Hays. It makes no difference if Ryker was the agent also of Mrs. McKay for the sale of her property.
Answering further the citation of counsel, 4 R.C.L. 272, sec. 22, I submit that this law is exactly in point, and that Ryker complied with the very letter and spirit of this law, and that a contract was prepared prior to the conclusion of the trade in which all of the facts were set out and all agreed to and signed by the parties. See, G. S.I.R. Co. v. McGee Warehouse Co., 67 So. 648.
Counsel for appellant cites the case of Walker v. Osgood, 93 Am. Dec. 168, but in that cases the court held that the agent did not act in good faith, while in the present case, the utmost good faith is shown on the part of the agent from any viewpoint. Gilder v. Davis, 137 N.Y. 504; Goss v. Stevens, 32 Minn. 472; Gelatt v. Ridge, 117 Mo. 553.
Appellee, a real estate agent, sued appellant in the county court of Harrison county for commission alleged to be due for services in a land deal. The case was tried before the county judge (jury being waived), resulting in a judgment for appellee in the sum of five hundred dollars. On appeal to the circuit court, plaintiff (appellee here) entered a remittitur of one hundred fifty dollars. The circuit court, on a hearing without a jury, rendered judgment for appellee in the sum of three hundred fifty dollars.
A Mrs. McKay had listed with Ryker, as agent, several pieces of property for sale, one of which was located on Second street, in the city of Gulfport, and valued at nine thousand five hundred dollars. The agent, Ryker, was to receive a commission of five per cent. from the sale or exchange of the McKay property. A few weeks thereafter Ryker procured appellant to list a tract of land with him, as agent, for sale, at ten thousand dollars. There was no agreement as to commission to be paid by appellant, but the evidence shows a prevailing rate of five per cent. in that section. Ryker, having been employed as the agent of both Mrs. McKay and appellant, began negotiations between them for the exchange of their properties, without telling appellant that he, as agent, was to receive a commission from Mrs. McKay. After considerable negotiations and showing the property one to the other, Ryker consummated an exchange of said property between the parties.
Appellant defends principally upon the ground that Ryker, being the employed agent of Mrs. McKay, at a fixed commission, cannot recover from him, since he had no knowledge of and did not consent to the dual capacity in which Ryker was acting. In other words, contention is made that the agent who acts for both purchaser and seller in the sale or exchange of property cannot collect commission from both parties, unless it is known and consented to by the parties.
There is no dispute in the evidence that Ryker was trying to collect commission from both parties to the transaction, and no dispute that appellant had no knowledge of the double agency.
The authorities seem to be practically uniform that, where double employment exists, without knowledge of the parties, there can be no recovery of commission by the agent against the party kept in ignorance. The rule is not based upon the presence or absence of designed duplicity and fraud, but upon an established policy. Among the many authorities supporting this principle are Farnsworth v. Hemmer, 1 Allen 483, 79 Am. Dec. 756, and authorities cited in notes; Cannell v. Smith, 142 Pa. 25, 21 A. 793, 12 L.R.A. 395; Blake v. Stump et al., 73 Md. 160, 20 A. 788, 10 L.R.A. 103; 4 R.C.L. and authorities cited in notes 5 and 6, p. 274; Scribner v. Collar, 40 Mich. 375, 29 Am. Rep. 541; Young v. Trainor, 158 Ill. 428, 42 N.E. 139; Hannan v. Prentiss, 124 Mich. 417, 83 N.W. 102; 4 R.C.L. 274; case note, 24 L.R.A. (N.S.) 659.
The well-defined exception to the rule is that a broker who merely acts as middleman to bring the parties together and who make their own trade may collect commission from both in the absence of fraud. A full collation of the cases enunciating the rule and the exceptions thereto will be found in the case note, 45 L.R.A. 33, and 24 L.R.A. (N.S.) 659. See, also, 4 R.C.L. supra.
We think the facts disclosed in the record bring the case within the above rule, and that appellee was not entitled to recover. The judgment of the learned court below will be reversed, and judgment entered here for appellant.
Reversed and rendered.