Opinion
April 11, 1966. —
May 10, 1966.
APPEAL from a judgment of the county court of Milwaukee county: HERBERT A. SCHULTZ, Judge. Affirmed.
For the appellant there was a brief and oral argument by Sidney Spector of Milwaukee.
For the respondent there was a brief and oral argument by Max E. Geline of Milwaukee.
Plaintiff Carroll Sinden is a licensed real-estate and business-opportunity broker. Mrs. Laabs, the defendant, was engaged in the tavern business, operating the Homestead Tap.
They signed an agreement, dated July 30, 1963. In consideration of Sinden's agreement to list Homestead Tap, including good will, fixtures and equipment and to use his efforts to find a purchaser, Mrs. Laabs granted him the sole and exclusive right to sell at a price, net to her, of $9,000. She promised to pay him a commission of $2,000 in the event of her refusal to close a sale with a purchaser procured by Sinden, a sale by her, independently of him, during the life of the contract, or a sale within one year after termination of the contract to any person whom he had introduced to the business or with whom he had negotiated during the life of the contract. The contract provided that it would remain in force until October 30, 1963.
Sinden advertised the property in a newspaper on seven dates in August and September. He took two couples, prospective buyers, to view the premises in August, but received no offer to purchase.
On September 16th, Mrs. Laabs wrote Sinden, telling him her property was taken off the market. There is no claim she acted in bad faith. She did make a sale November 20, 1963, to Mr. Pietruszka. He first inquired of her about the possibility of a purchase late in October. There is no claim that his interest in the property was generated by Sinden's efforts.
At the close of plaintiff's case-in-chief, Mrs. Laabs moved for a nonsuit. The motion was granted, and judgment of dismissal entered September 9, 1965. Plaintiff has appealed.
Additional facts will be referred to in the opinion.
Plaintiff Sinden put in his case upon the theory that the listing document constituted a bilateral contract, binding Mrs. Laabs to keep open his opportunity to earn a commission until October 30th; that she was not free to revoke it unilaterally; that by her notice that she would refuse to sell, she excused him from producing a purchaser; and therefore, without producing one, he was entitled to his commission.
Defendant Laabs asserted that Levander v. Johnson controls; that prior to performance by Sinden, she had the right to revoke, since her withdrawal of the property was "done in good faith and not for the purpose of defeating a claim for compensation" and that Sinden's placing of advertisements and showing the property to prospects did not constitute performance.
(1923), 181 Wis. 68, 193 N.W. 970.
Ibid. page 71.
The trial court apparently concluded that Mrs. Laabs could not revoke, but that Sinden was not entitled to a commission because he failed to produce a ready, willing and able buyer on or before October 30th.
The listing agreement was a bilateral contract, at least in form, binding both parties by mutual promises for a definite period of three months. Even if Sinden's promise, reflected in the listing agreement, to "list" and to "use [his] efforts to find a purchaser" be deemed too insubstantial or vague to constitute sufficient consideration for Mrs. Laabs' promise to keep the exclusive listing agreement in force for three months, it was proved that Sinden did incur expense and put forth effort to find a purchaser.
12 Am.Jur.2d, Brokers, p. 796, sec. 32.
Where an owner made a unilateral promise to pay brokers a commission on sale, revocable on ninety days' notice, this court has said that although the owner's signature did not make a contract, the brokers "might have accepted the implied obligations of the' writing on their part by doing the work and incurring the expense that such writing contemplated should be performed and incurred, and such acceptance, so made, would result in a binding contract."
Schoenmann v. Whitt (1908), 136 Wis. 332, 334, 117 N.W. 851.
"Although the principal may revoke the broker's agency notwithstanding the employment is to continue for a definite time, he renders himself liable, unless such revocation is for cause, for such damages as are the proximate result of his termination of the employment contract. This assumes, of course, that the contract is supported by consideration and is otherwise binding."
12 Am.Jur.2d, Brokers, p. 814, sec. 56.
We consider the foregoing statement applicable here. In the Levander Case, relied on by defendant, the only promise of the brokers reflected in the listing agreement was to "list" and they failed to show any sales efforts prior to the revocation. This court said:
"There is no actual showing in this case by plaintiffs of anything having actually been done by them in reliance upon the contract and for the purpose of performance thereunder prior to the time of the notice of revocation. There was nothing, therefore, in the shape of performance on their part sufficient to have made the contract absolute between the parties at the time of the revocation, under the views expressed in Schoenmann v. Whitt, 136 Wis. 332, 334, 117 N.W. 851." (Citing other cases.)
Levander v. Johnson, supra, page 71, footnote 1.
The reference to Schoenmann suggests that the degree of performance required is the use of "ordinary diligence in endeavoring to make a sale of the property,"as phrased in Schoenmann. As Levander stood, the court applied the rule governing an owner's unilateral promise to pay a commission for effecting a sale and held that the owner may, when it is done in good faith and not for the purpose of defeating a claim for compensation, revoke, upon notice, his promise to pay a commission.
Levander v. Johnson, supra, page 71, footnote 1. See Restatement, 2 Agency 2d, p. 345, sec. 445, ch. 14.
Sinden's remedy was either to bring action for damages for breach of the contract or to disaffirm the contract and seek recovery of the reasonable value of the services he had rendered. He attempted the former, but failed to prove any loss resulting from being deprived of the opportunity to sell between September 16th and October 30th. There is authority that in such case he would be entitled to "a small sum as nominal damages" but he did not raise that point either in the trial court or here. He also failed to prove the reasonable value of his services, or the amount of disbursements he had made.
Restatement, 2 Agency 2d, p. 371, sec. 455, ch. 14. See 12 Am.Jur.2d, Brokers, p. 819, sec. 64.
Restatement, 2 Agency 2d, p. 371, sec. 455, ch. 14.
The nonsuit was properly granted.
By the Court. — Judgment affirmed.