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24 Jones & S. 366

Alden v. Earle

The Superior Court of New York City

Decided January 7, 1889

The Superior Court of New York City · decided 1889-01-07

<p> Brokers—commissions not earned, in the absence of bad faith, unless they bring parties to prove an agreement. Evidence, insufficient to establish a bringing of the parties to an agreement. </p> <p>Plaintiffs are real estate brokers and brought this action for commissions on a leasing of real estate. Defendant being desirous of leasing a building of which he was the owner, employed a broker named Goodale, who was in charge of the building and had the keys and who caused to be affixed on the building a sign, that persons wishing to rent should apply to him. The plaintiffs knowing that the building was to lease, sent a party to look at it and afterwards one of the plaintiffs had an interview with defendant in respect to leasing to that party, in which he said to defendant,—“ The commission is one per cent on five years lease, to which defendant replied that is all right but I think I would not like to rent to that party because I do not like the business; ” and also said, “ I suppose about $11,000 would take the building to a good party on alease.” Afterwards plaintiffs on behalf of their party, made a definite offer to defendant for a five years lease from May 1, 1887. This offer was declined. Defendant demanded that rent should begin March 1st and said to plaintiffs, “if your parties will take the place from March 1st, I will let them have it on the terms they propose.” After this, on January 31st, plaintiffs renewed the former offer with the exception of making the rent begin April 15th instead of May 1st, saying that was the best offer their parties could make. Defendant being pressed • to give a definite answer to this offer wrote to plaintiffs declining the offer and ending his letter with “ the negotiation is now closed.”—About a week after this the parties, on whose behalf plaintiffs had been negotiating with defendant, opened negotiations through Mr. Goodale, the ' result of which was a lease to them on the terms offered by plaintiffs, except that the rent was to commence April 1st. There was no evidence of bad faith on the part of the defendant. The facts were undisputed.</p> <p>Held, (1) that plaintiffs had not earned commissions in as much as they had failed to bring the parties to an agreement. (2) That a direction of a verdict for plaintiffs was error.</p>

Relies on Sibbald v. . the Bethlehem Iron Company · Wylie v. . Marine National Bank

Decided 1889-01-07

By the Court.—Ingraham, J.

¶1The action is brought by the plaintiffs, real estate brokers, to recover commissions for renting certain premises of the' defendant.

¶2The obligation that a broker assumes and that he must perform before he is entitled to commissions, is stated in Sibbald v. The Bethlehem Iron Co., 83 N. Y. 381. Finch, J.,.in delivering the opinion of the court in that case says, The duty he undertakes, the obligation he assumes as a condition of his right to demand commissions, is to bring the buyer and seller to an agreement.”

¶3The court among other cases cited the case of Wylie v. The Marine National Bank, 61 N. Y. 415, and in speaking of that case, it is said, “ It was held that to entitle a broker to commissions, he must produce a purchaser ready and willing to enter into a contract on the employer’s terms. This implies and involves the agreement of buyer and seller and meeting of their minds produced by the agency of the broker; ” and at page 382 it is said, “ But in all cases, under all and varying forms of expression, the fundamental and correct doctrine is, that the duty assumed by the broker was to bring the minds of the buyer and seller to an agreement of sale and the price *370and terms on which it is to be made,' and until that is done his right to commissions does not accrue.”

¶4Another principle established by that case is “ To such a contract as existed in the present case where no time for the continuance of the contract is fixed by its terms, either party is at liberty to terminate it, subject, only, to the ordinary requirements of good faith.”

¶5Applying these principles to the facts of this case, it is clear that the plaintiffs had not performed the work that they were employed to do, the performance of which was necessary before they were entitled to compensation, as they had not effected the leasing of the premises before this authority was revoked.

¶6There was no employment of the plaintiffs by the defendant to obtain a tenant for the premises. Another broker was in charge; had the keys of the building and had a sign on the building that persons wishing to rent should apply to him.

¶7The plaintiffs sent Mr. Hulbert to look at the premises. He obtained admission to the property and had an interview with the defendant without disclosing the fact that he had been sent by the plaintiffs. Subsequently, plaintiffs wrote two letters to the defendant, asking him to call on them in regard to the property. Defendant, however, did not call, and several days afterwards one of the plaintiffs called at defendant’s house and had an interview with him. Subsequently another interview was had at which plaintiffs stated that the commission would fee ¡one per cent on the five years lease, to which defendant said “ that is all right.” Defendant then stated “ that eleven thousand dollars a year would take the building to a good party on a lease,” and plaintiff then, made an offer -on behalf of Mr. Hulbert of $11,000 for the first year, $11,500 for the second year and $12,000 for the three years thereafter. To that defendant said, “That looks very good. I will think it over and let you know.”

¶8There were subsequent negotiations between Hulbert *371and the defendant, and several letters were written by plaintiffs to the defendant to which no answer was returned ; and on January 31, 1887, plaintiffs wrote a letter to the defendant in which they say “ After considerable work on our part, we have induced them again (Merwin, Hulbert and Co.) to say they will take your building, No. 26 West 23d Street, upon the terms proposed by them and let the rent commence on the 15th of April. Thip they say is their best offer and they desire to hear from us at once your acceptance or rejection as they have several other places in view; ” and in reply to that letter on the same day defendant wrote to plaintiffs, The proposition you make for Messrs. Merwin, Hulbert and Co. for my building 26 West 23d Street on the terms of five years lease, I most ■ respectfully decline. The negotiation is now closed.”

¶9Up to this time it is evident that the plaintiffs had not performed their obligation: they had not procured a tenant on terms satisfactory to the defendant. At no time had the defendant appeared anxious to have anything to do with them, or encouraged them to proceed on his behalf; and although the evidence would justify a finding, that there was an obligation to pay them the commissions if they had procured a tenant who had agreed to his terms and was satisfactory to him, there certainly was nothing that was said or done that would prevent defendant at any time revoking the authority that the plaintiffs had and that he did.

¶10The plaintiffs subsequently endeavored to obtain from Mr. Hulbert a more favorable offer and failed, and then apparently abandoned the negotiations and had no further connection with the property.

¶11There is not the slightest evidence of had faith on behalf of the defendant: he made no further efforts to negotiate with Hulbert, or, so far as appears, to lease the property.

¶12It does appear, however, that about ten'days afterwards Mr. Hulbert went to the broker who had charge of the *372property, made him a new offer for the property on more advantageous terms than the offer made by plaint-tiffs, which offer defendant subsequently accepted.

¶13The efforts of plaintiffs had been unsuccessful; they failed to bring the defendant and the proposed lessee to an agreement; the negotiations were closed and as was said in Sibbald v. The Bethlehem Iron Co., supra, at page 387, they very plainly had acquired no right to the commissions for anything that might ,happen in the future, unless upon the solé and only ground that the defendant terminated the agency in bad faith and as a device to get the benefit of the plaintiffs’ labors without paying for them.

¶14I think therefore the complaint should have been dismissed.

¶15The judgment should be reversed and a new trial ordered.

¶16Sedgwick, Ch. J., concurred.

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