Greenblatt v. Fox

Opinion by Kephart, J., Two questions are involved in this appeal: Was the interpretation of the contract for the court, and did the plaintiff forfeit his right to commissions for services? The defendant employed the plaintiff to procure a purchaser for his real estate and for his services agreed to pay him a commission of one per centum on the contract price. The plaintiff procured the purchaser, who entered into a contract of sale with the defendant and paid $1,000 on the purchase price. At the time the contract was executed, the defendant delivered to the plaintiff a letter, which defendant says controls the contract in question, and specifies the time when the commissions were earned. The letter is as follows: “On completion of the transaction entered into with you this day, I agree to pay you one per centum (1%) on the purchase money of houses that is the sum of Five [58] Hundred and Seventy Five ($575) Dollars.” The defendant argues that the word "transaction” had reference to the agreement of sale and that the payment of the commission should only be made on the consummation of the final settlement of the contract of sale, which, not being done, the plaintiff was not entitled to receive any commission. The plaintiff objects to this conclusion and states that this language did not express the understanding between the parties and in explanation thereof he offers testimony to prove that his contract was to produce a purchaser, which he had done, and the production of this purchaser, with the execution of the contract of sale, was the completion of the "transaction” referred to in the letter and that the letter was given in.the nature of a duebill. The controversy as to what was the understanding between the parties, in the light of the oral testimony, was for the jury: Elliott v. Wanamaker, 155 Pa. 67. They found for the plaintiff, and in so doing they determined as a fact that the plaintiff had done all that was required of him when he produced the purchaser who entered into the contract of sale and paid a part of the purchase money, and that the letter did not interfere with or disturb his right to commission but was in affirmance of that right. Assuming that the defendant’s theory would be the correct one, that the proper interpretation of this contract was that the plaintiff should only secure his commission when the money was all paid in final settlement of the contract of sale, in what position does defendant find himself by his failure to make some effort to complete his contract? He had received a portion of the purchase money. The purchaser was obliged to make final settlement. A deed covering the property had been given to the defendant for execution. He gives no reason for his refusal to complete the deal. There is no evidence that the purchaser, though not the ostensible purchaser, was not a reliable one. The mere fact that he was a barber would not justify defendant in [59] assuming that it was useless to ask him to pay the balance of the purchase price. When this agreement was made and the hand money paid, it was necessary for the defendant to do something in affirmance of that contract before he would be in a position to deny the plaintiff’s right to recover. This matter was wholly within his power. The plaintiff had done everything that he could to forward the sale of the property; he was powerless to give any further aid in the matter when the defendant refused or neglected to act. The letter and all testimony was submitted by the learned court below in a charge that affords the appellant no ground for complaint. The third, fourth, fifth and sixth assignments of error are overruled. The written contract was signed for the purchaser by his attorney in fact, a son of the plaintiff. It is admitted that he was not the real purchaser but was acting as a “straw man” for a real estate firm. The plaintiff was the agent of the defendant. It was his duty to impart to his principal any information that came under his observation that would in any way affect his principal’s business, so that his principal might determine whether the deal should be consummated or not. A special trust and confidence is reposed in the agent and the utmost good faith is required of him. He represents the owner and stands in his place. Proof of fraud on the part of the agent is not necessary. It matters not that the omission to inform the principal was unintentional and no injury had been done. The rule is intended to prevent wrong from being done. Where one employs another to act as agent he “disarms the vigilance” of his principal and the agent is afforded peculiar facilities for obtaining confidential information. The principal’s interest then must be safely guarded: Pratt v. Patterson’s Executors, 112 Pa. 475; Wilkinson v. McCullough, 196 Pa. 205; Everhart v. Searle, 71 Pa. 256; Linderman v. McKenna, 20 Pa. Superior Ct. 409; Del. County Trust Co. v. Lukens, 38 Pa. Superior Ct. 509; Clark v. Phila [60] delphia, 46 Pa. Superior Ct. 253. The real purchasers had a special object in having their names concealed. It is no answer to say that this defendant, the principal, asked no question when he signed the agreement. Herein the confidence in his agent disarms any suspicion. We do not know what reasons might have been covered by the concealed movements of the real purchasers. It is no answer to say that the deal was cash at the end of sixty days and that the defendant was paid $1,000 which was forfeited. It is not difficult to surmise many conditions which would have made it quite cheap to have had this property out of the market for sixty days. We do not say that this is wrong on the part of the real estate agency. It may be properly within the legitimate scope of an active real estate business, but what is here complained of is that the owner’s agent should in no way be a party to it, and should not fail to communicate any detail that he might know to his principal. Did the agent, the plaintiff, know? He testifies that he did not. The attorney in fact states that he did not inform his father. We cannot as a matter of law say that it was the duty of the agent to have inquired from his son or any attorney in fact or purchaser whether he was purchasing for himself or another party. We cannot presume that knowledge came to the plaintiff by virtue of his relationship with the attorney in fact. There being no evidence from which the jury could infer knowledge on the part of the agent, that the person who signed the agreement was not the real purchaser, we are compelled to overrule the first, second and seventh assignments of error. Judgment affirmed at the cost of appellant.