S. V. Thompson Company, Appellant, v. Goldman.
Principal and agent — Real estate broker — Commissions—Securing purchaser — Conditional sale.
1. In an action by a real estate agent against an owner to recover his full commissions, the plaintiff must show that he had procured for the defendant a party with whom the defendant was satisfied, and who actually contracted for the property at a price acceptable to the owner; or that it was through his efforts that the purchaser was secured, to whom the defendant after he wrongfully took the matter out of the agent’s hands made the sale; or that even if he had not secured any binding contract from the proposed purchaser, he had actually produced to his principal a purchaser able and ready to perform his part of the proposal, so that the failure to complete an actual salé resulted alone from the fault or inability of the principal.
2. In such a case the broker will not be entitled to his commissions if the agreement of sale is conditional upon the proposed purchaser securing a loan of an amount specified, if there is no evidence to show that purchaser had the financial ability to borrow such a sum and satisfactorily secure its repayment.
Argued May 14, 1912.
Appeal, No. 102, April T., 1912, by plaintiffs, from order of C. P. Armstrong Co., June T., 1907, No. 204, refusing to take off nonsuit in case of S. Y. Thompson, Harry H. Hunter and C. E. Frankenberry, trading as S. V. Thompson Company, v. D. A. Goldman.
Before Rice, P. J., Henderson, Morrison, Orlady, Head and Porter, JJ.
Affirmed.
Assumpsit to recover commissions for the sale of real estate., Before Patton, P. J.
At the trial the court entered a compulsory nonsuit which it subsequently refused to take off, Patton, P. J., filing the following opinion:
This case was before the Superior Court, and passed upon in 41 Pa. Superior Ct. 209, and it was there held (page 218) that before the plaintiffs were entitled to recover their commission, they must show either (a) “That they had procured for the defendant a party with whom *633he was satisfied, and who actually contracted for the property at a price satisfactory to the owner.”
(b) Or that it was through their efforts that the purchaser was secured to whom the defendant, after he wrongfully took the matter out of their hands, made the sale.
(c) Or that even if they had not secured any binding contract from a proposed purchaser, they had actually produced to their principal a purchaser able and willing to perform his part of the proposal, so that the failure to complete an actual sale resulted alone from the fault, or inability of the principal. It is admitted by all that W. H. Morrow purchased the property directly from Goldman, without the procuration of Thompson & Company, and that it was not through their efforts that he was procured, so that the propositions (a) and (b) are out of the case.
Now then as to proposition (c). Was there any testimony to submit to the jury that Thompson & Company had actually produced to Goldman, the firm of Wilson & Shaffer as purchasers, able and ready to perform their part of the proposal of April 16, 1907, so that the failure to complete an actual sale resulted alone from.the fault or inability of Goldman? Take up the proposal of D. A. Goldman, of April 16, 1907.
He authorized Thompson & Company to sell, first, consideration, $12,500; second, description: furniture, fixtures, lease and good will; third, terms:'cash.
When Thompson & Company, as agents of Goldman, made the contract of May 2, 1907, to sell to Shaffer, they agreed: first, consideration, $12,250; second, de-' scription: furniture, fixtures, lease, good will, stock, together with all and singular the buildings, improvements, etc. Terms: $500 on signing agreement .and the balance on delivery of possession.
The plaintiffs offered proof tending to show that Goldman afterwards agreed to reduce the consideration' to . $12;250, and that the agreement to sell the -building and; *634improvements was inserted by mistake. Also that Goldman read the contract of May 2, 1907, and said it was all right. A casual glance at the two contracts shows that they are wide apart as to their conditions and covenants. Taking it for granted that when Goldman looked over the latter contract, and said that it was all right, as testified to, is there any evidence to show that Wilson & Shaffer were “able and ready” to secure the loan of $7,250, mentioned in the agreements. Their testimony is that they did not have it, or attempt to get it, but that S. V. Thompson & Company were to get it. So far as the testimony shows, Thompson & Company made an inefficient attempt to borrow the money from the Independent Brewing Company, and failed. No other negotiations were pending. Must Goldman wait an indefinite time to allow Thompson & Company to borrow the money, and not sell his property if another purchaser appears? At the close of the plaintiff’s case it stood in this regard just as in the former case when the Superior Court said: “There is no evidence to show whether or not they had the financial ability to borrow such a sum of money and satisfactorily secure its repayment, and the assertion- that they could have secured such a loan, and thus become bound by an absolute contract to purchase something, rests on nothing more than conjecture.”
It is significant that although Mr. Thompson and Mr. Hunter, the two partners of Thompson & Company, were called upon the witness stand, they did not attempt to show where they could procure such a loan, or that they had the financial ability to do so. The testimony of G. W. Wilson shows that the firm of Wilson & Shaffer was to raise only $5,000. “S. V. Thompson was to raise the balance of the money. I never received any notice from S. V. Thompson that he had procured the money for me. We did not try to make any other arrangement because we had depended upon Mr. Thompson. The understanding all the way through was that Mr. Thompson was to get the money. Mr. Goldman refused to sign the. *635contract because they could not get the loan from the Brewing Company.”
With this uncontradicted testimony, and the decision of the Superior Court before us, we do not see how it was possible to refuse the motion for a nonsuit.
Again, the contract of April 16, required the payment of the consideration in cash, and the contract of May 2, 1907, required the payment of $500 on signing the agreement, and the balance on delivery of possession. But the uncontradicted evidence is that this contract was wholly between Thompson & Company and Wilson &. Shaffer, that the consideration was not to be paid until the license was transferred with the approval of the court of quarter sessions.
Mr. Thompson testified: “The agreement with Mr. Wilson was that the sale was contingent upon the transfer of the license by the quarter sessions court, that if the court did not transfer the license, the $500 was to be returned, and the deal declared, off.”
Here is a new agreement which is a radical departure from both written agreements. If I understand the testimony, it was made on May 4. The plaintiffs attempt to get away from this by showing that Goldman, at Ford City, between April 16, and May 2, said that it would be an easy matter to get the license transferred. Suppose that he did so state. That would not bind him to wait an indefinite time and allow Wilson & Shaffer to experiment about the transfer, and if they failed, refuse to pay for the property.
Further, the uncontradicted testimony showed that Thompson, at Pittsburg, at the solicitation of Wilson, induced Goldman to reduce the selling price of the property from $12,500 to $12,250. Thompson also agreed to act as the agent of Wilson & Shaffer to procure the loan, and instead of having the purchase price paid in cash, or on delivery of possession, to have it paid one-half in one year, and the balance in two years. This was serving two masters, and by such conduct they forfeited their commission.
*636Plaintiffs’ counsel contend that this case is governed by the case of Reed v. Reed, 82 Pa. 420. That was our opinion on the former trial. But the Superior Court holds that it was tried on a mistaken theory. The present suit is for the commission. The plaintiffs .neither by their pleadings nor evidence claim compensation for breach of the agreement.
Reed’s case does not point out the distinction between a suit for the stipulated commission and a suit for compensatory damages for a breach of the covenant as so clearly shown by Judge Head, in his opinion in this case, 41 Pa. Superior Ct. 209.
And now, August 15, 1911, the motion to take off the compulsory nonsuit is refused, to which the plaintiffs except, and at their request bill of exceptions sealed.
Error assigned was the order of the court refusing to take off nonsuit.
Floy C. Jones and H. A. Heilman, for appellant.
R. L. Ralston, with him E. O. Golden, for appéllee.
October 14, 1912: