Jensen v. Bowen

Bruce, Ch. J. (after stating the facts as above). It is urged that the defendant, Bowen, was acting for Davis in the sale of the land; that Davis had promised him a commission for selling the same, and that since the proof sIioavs that the plaintiff, Jensen, had also agreed to pay him a commission, and this fact Avas not known to Davis, no recovery can be had. There can be no doubt of the correctness of this contention, provided that the proof does not also show that the defendant Avas merely a broker or middleman. The rule is one of public policy. “The rule is intended to be not only remedial of actual wrong, but preventive — 358 — of the possibility of it. . . . There can be'no recovery from the party kept in ignorance, for as against him the broker has been guilty of a breach of faith and contract; inasmuch as it is a physical impossibility for him to render to more than one side, at one and the same time, his entire skill, judgment, and discretion as is bargained for by each employer in the absence of an express stipulation to the contrary. Nor can there be any recovery from the party who alone consented to the broker’s acting in behalf of both, for he and the broker are equally guilty of the wrong committed against the other employer, and the law will not enforce an executory contract entered into in fraud of the rights of the latter.” 4 R. C. L. 329; Rice v. Davis, 136 Pa. 439, 20 Am. St. Rep. 931, 20 Atl. 513; Scribner v. Collar, 40 Mich. 375, 29 Am. Rep. 541; Bell v. McConnell, 37 Ohio St. 396, 41 Am. Rep. 528. There is, however, an exception to this rule, and that is that “a broker employed as a mere middleman, or, in other words, one engaged not to negotiate a sale or purchase, but simply to bring two parties together and permit them to make their own bargain, may recover an agreed compensation from either or both, though neither may know that compensation is expected from the other.” Montross v. Eddy, 94 Mich. 100, 34 Am. St. Rep. 323, 53 N. W. 916; Leathers v. Canfield, 45 L.R.A. 33 and note, (117 Mich. 277, 75 N. W. 612); 4 R. C. L. 330. “A broker is simply a middleman, within the meaning of this exception, when he has no duty to perform but to bring the parties together, leaving them to negotiate and [to] come to an agreement themselves without any aid from him. If he takes, or contracts to take, any part in the negotiations, however, he cannot be regarded as a mere middleman, no matter how slight a part it may be.” 4 R. C. L. 330; Montross v. Eddy, supra; Barry v. Schmidt, 57 Wis. 172, 46 Am. Rep. 35, 15 N. W. 24; Scribner v. Collar, 40 Mich. 375, 29 Am. Rep. 541; Leathers v. Canfield, supra. In the case at bar there seems to be no proof that the defendant, Bowen, was actually employed h> take any part in the negotiations. The question is, Did he take such a part? If he did, under the authorities cited, he can recover no commissions, for the question is one of public policy as well as of implied contract. Anderson v. First — 359 — Nat. Bank, 5 N. D. 80, 64 N. W. 114; Clendenning v. Hawk, 10 N. D. 90, 86 N. W. 114. Nor does it make any difference that tbe price was fixed by bis first employer. See Webb v. Paxton, 36 Minn. 532, 32 N. W. 749. Unless, indeed, be was a mere middleman, each party who employed him was entitled to tbe exercise of bis discretion, skill, and judgment; and tbe mere fact that tbe price was fixed by one would not absolve him from tbe use of such skill and discretion in regard to tbe interest of tbe other. But was he employed to act and to negotiate, or did he negotiate, for both parties ? The question being one of burden of proof, when the double agency was shown, did he overcome the presumption of bad faith occasioned thereby by proof that he was merely a middleman, and this not merely at the inception, but throughout the whole transaction? We believe he did not, and we believe that it was incumbent upon him to do so. The defendant testifies that he was employed by Mr. Davis to sell the land under the following letter of employment: “I want to sell as I "bought more here lately. I am going to advertise mine for sale. Will sell it cheap too, as I want to get rid of it and get the money in here if possible. If you know anyone who has $10,000 in cash and will assume $900 due Fisher on Oscar’s 160, I will make it an object to you. Will throw in my share of the crop on the place besides.” He also testifies that he showed this letter to the plaintiff, Jensen, and that Jensen “told me that if I would get him and Mr. Davis together that he would give me a dollar an acre.” He then testifies: I got Mr. Jensen and Davis together and Jensen bought the land. The deal was closed up about the 1st of September, 1912. Q. Now, Mr. Bowen, you were employed by Mr. Davis to sell this land for him, were you not ? A. Well, I don’t think I was really employed by him. I don’t know whether you would call it employed or not; it might be. Q. This letter was dated July 12, 1912? Mr. Bowen, you say that shortly after that, along about the 1st of August, you saw Mr. Jensen and asked him if he wanted to buy this property ? — 360 — A. I think it was around that time. It was sometime after I got this letter. I showed him that letter and told him what I could sell it to him for. He told me that if I would get him and Mr. Davis together that he tvould give me a dollar an acre. Q. What else did he say ? A. Well, he didn’t want to come through on the proposition that Mr. Davis submitted there, and he told me his proposition. Q. Now, Mr. Bowen, I will ask you whether or not Mr. Davis ever paid you any commission for making this sale? A. Tes, sir, he did. I owed Mr. Davis a note of $260. He gave me that note back and gave me $210. Q. Now, Mr. Bowen, did you ever inform Mr. Davis that you had been employed by Mr. Jensen to buy this land from him ? A. I don’t know whether Bruce ever knew it. I never told him. He knew the whole deal at the time he paid me the commission. He knew this along in December, 1912. Q. And that is when he learned it ? A. I think that he knew about it before. He learned of it along in December. Q. That is when he became aware of that fact, when you signed this receipt just shortly before this ? A. He knew what our agreement was, and what we had settled on according to his letter on the 5 th day of September. Q. You never told him that you were acting as agent of Mr. Jensen in purchasing this land ? A. I think I told him the day we settled up, the day we bought the crop. He couldn’t help but know it, because Jensen was the man that was getting the land. Q. You never told him'that you were acting as agent of Mr. Jensen in purchasing this land ? A. No, I don’t think I ever told him. Q. Now, Mr. Bowen, I will ask you whether or not you sold this land to Mr. Jensen in accordance with Mr. Davis’ letter to you? A. No, sir, I didn’t. I didn’t sell it to him that way. Q. You made this sale did you not, Mr. Bowen? A. Well, the deal went through. Q. Through you ? — 361 — A. The deal went through. Q. Didn’t it come through you, Mr. Bowen? A. I never owned the land. Q. Through your efforts ? A. Well, I guess so. Q. Did you ever communicate with Mr. Davis after you had received this letter from him telling you that he wanted to sell this land, and he would pay you for it if you sold it ? A. Yes, sir, I did. Q. What did you write him ? A. I stated Mr. Johnson’s terms. I didn’t tell him at that time that Mr. Jensen was buying this land. • Q. Do you know whether Mr. Davis accepted this or made the sale in accordance with the terms of your letters to him ? A. Well, the deal finally went through on Mr. Jensen’s terms. Q. On the terms that he first offered you ? A. Not the first offer, no. Q. Well, the second offer ? A. Well, he finally made up his mind what he would do. Q. You .never made Mr. Davis hut one offer on this land, did you, Mr. Bowen, as agent for him that you had received from Mr. Jensen? A. I think there were two propositions submitted to Mr. Davis. Q. Both by Mr. Jensen? A. Through me. Q. Through you? A. Yes, sir. The land was not sold on the first offer made by Mr. Davis or on the first offer made by Jensen, but they finally got together. I didn’t draw up any contracts or sign any. Q. Now, wasn’t it through your efforts that you put out that Mr. Davis paid you for your efforts in selling this land to Jensen? A. Why, he did as he agreed in the letter he wrote me. He paid me what he agreed to pay in the letter. Mr. Davis testifies as follows: Q. I will ask you whether or not you ever employed Mr. Bowen to sell this land for you ? A. Well, in writing him about other things I don’t remember the exact words I used, but I told him that if he found a buyer for the — 362 — land at the stated price that I would make it right with him, or words to that effect anyway. Q. Did Mr. Bowen ever find a buyer for you ? A. Yes, he did. I sold the land. He found Mr. Jensen. I think I first heard from Mr. Bowen in regard to the sale of this land in August or during the summer. In reply I think to a letter I had written him about other matters, he put up this proposition. I did not know who the party was or anything at the time, but this is the farm deal that went through later on. He didn’t tell me that he was selling the land to Mr. Jensen. Q. State whether or not, Mr. Davis, he told you that he had been hired by Mr. Jensen to buy this land from you ? A. No, there was nothing mentioned about any man at all any further than putting up the deal to him, no names mentioned at all. Q. Now, at the time of this sale, Mr. Davis, did you have any knowledge that Mr. Jensen had employed Mr. Bowen to buy this land from you ? A. No. Q. What did you pay him for .selling this land ? A. A commission of $475. Q. Now, I will ask you, Mr. Davis, whether or not the land was sold when you sold it exactly in conformity with the terms of Mr. Bowen’s offer to you? A. Yes, I think it was. Q. Exactly? A. Yes. When I wrote to Mr. Bowen to put it up to him it was to be a cash proposition. When he came to me with this deal it went through as he had written to me. It went through exactly as he had written to me. There was only this one offer made on his part. He didn’t tell me that Jensen was buying it. Q. And yon didn’t know until you closed the deal ? A. The first I knew about it was the telegram I received who to make warranty deed to. Q. You didn’t care, Mr. Davis, who you sold the land to as long as you got a customer who was willing to pay your price ? A. Why, no, not if I got the terms and everything was satisfactory. — 363 — Tho deal must have been satisfactory to me. I made it. I knew who was getting the land before I made the deed. Q. Before you transferred the property ? A. Yes. Q. Did you come down here yourself ? A. Yes, I was here for three or four days. Q. To close up the deal with Mr. Jensen? A. Well, in a way,practically so, yes, but it was some time after that before it was finished on account of the abstract. Q. Well, everything was closed when you wore here except the transfer of the papers ? A. Yes. Q. And, while the deal was not the same as written on the back of “exhibit A,” you were willing to pay Mr. Bowen the $475 ? A. I did and got a receipt from him. I paid that after the deal was closed up and after I knew who the buyer was; I think so. Mr. Murtha: The defendant offers to show by this witness that he relied upon his own judgment in making the deal, and not upon the judgment or advice of the defendant. Mr. Jones: Object to the offer as incompetent, irrelevant, and immaterial. The Court: Objection sustained. Q. Wasn’t there more than one proposition submitted to you ? A. Not to my memory, no. Q. How long did the negotiations run along after they started in August ? A. Well, I don’t know. It must have been February before the abstract was satisfactorily fixed. Q. But I mean before you had everything all except the title papers ? A. I don’t know, I came down here somewhere around the 1st of September and talked the matter over with Mr. Jensen. Q. And you came to an agreement, settlement ? A. Well, I had practically agreed to that before I ever left home. Q. You left the deed in one of the local banks here for delivery? A. I don’t remember. Q. You didn’t leave it with Bowen, Bowen didn’t collect any of the money for you? — 364 — Mr. J ones: Object to that as incompetent, irrelevant, and immaterial. The Court: Objection sustained. Q. You never wrote to Bowen any other letter about employing him except the one that is in evidence here ? A. That’s all, but I had written other letters to him. There was nothing more, I think, that I wrote about the terms of the employment save this. Q. lías he ever written you anything about this deal other than you have testified to ? A. Well, yes, he wrote me in regard to the commission, he wanted to know what I was going to do about it. That is practically about all there was in the letter. Bowen never told me that Jensen was paying him anything. H. O. Jensen, on being recalled, testified: I never employed Mr. Bowen to buy this land from Mr. Davis. I never agreed to pay him anything if I was able to buy the land from Mr. Davis. I never hired him to get us together as he stated. I bought this land through Mr. Bowen. Q. Of Mr. Davis ? A. Yes, that is who I got the deed from. He represented himself to be Mr. Davis’ agent. This testimony, to our minds, does not show the position of a middleman, and it-was incumbent upon the defendant to prove that fact. The judgment of the District Court is reversed and a new trial is ordered.