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THERON C. HECHT
ALBERT F. MARSH, Appt.
Nebraska Supreme Court – December 31, 1920.
(- Neb. 181 N. W. 135.) Evidence — of oral modification of broker's contract.
1. In defense to a broker's action for the commission stipulated in his written authority to sell land, the principal alleged, and offered parol evidence to prove, that negotiations with the purchaser were about to fail because the latter could not meet the terms upon which the broker was authorized to sell, when the broker, in order to induce the principal to sell on other terms, orally proposed that, if he would conclude the sale on those terms, he would claim no commissions unless the purchaser performed his contract, and that he consented to the sale upon modified terms in reliance upon that condition. The purchaser refused to perform. Held, error to refuse to receive the offered evidence.
[See note on this question beginning on page 10.] Estoppel - to take advantage of ab- Specific performance erroneous resence of writing.
cital of valuation effect. 2. Equity will not allow the Statute 3. An erroneous recital in an execuof Frauds to be used as an instrument tory contract for the sale of land as of fraud, and where a party to a writ- to the valuation fixed upon a certain ten contract within the statute in- tract in the transaction will not induces the other to waive some pro- validate it for uncertainty or prevent vision thereof upon which he is
its enforcement, where the ambiguity entitled to insist, and to change his
is explained and the real valuation inposition to his disadvantage with re
tended by the parties is disclosed by spect thereto, by himself promising to
the other provisions of the contract. modify it with respect to some provision for his benefit, he will be estopped
Vendor and purchaser error in valuto claim that such subsequent oral
ation of exchange land effect. modification is invalid because not in 4. The vendor in an executory land writing.
contract, who covenants to accept the [See 25 R. C. L. 712.]
conveyance of a certain tract therein Headnotes by DORSEY, C.
described in part payment of the purchase price of his land, will not be heard to say that the contract was void because of an erroneous recital therein of the valuation placed upon
said tract, where it appears that he intended to accept it at its true valuation, notwithstanding the error, and was not misled or injured thereby.
[See 27 R. C. L. 349.]
APPEAL by defendant from a judgment of the District Court for Arthur County (Hobart, J.) in favor of plaintiff in an action brought to recover a broker's commission alleged to have been earned by him. Reversed.
The facts are stated in the Commissioner's opinion.
Messrs. Beeler, Crosby, & Baskins, such form as to be capable of enforcefor appellant:
ment. The price of land, the terms of the 4 R. C. L. 307, 148; Snyder v. Fidsale, and what shall be considered as ler, 125 Iowa, 378, 101 N. W. 130. so making the sale as to entitle the The mistake against which a court broker to his commissions are not re- of equity grants relief is such as either quired to be specifically stated in the discloses that the minds of the parties contract, and therefore a verbal con- never have met, and that there was tract to vary the terms in these therefore no contract, or else where regards is sufficient.
the contract was defectively executed Bradley v. Bower, 5 Neb. (Unof.) so as not to express the real agreement 542, 99 N. W. 490.
of the parties. The parties were at liberty to modi- Moore v. Scott, 47 Neb. 346, 66 N. fy by parol such portions of the con- W. 441. tract as the statute does not require Messrs. George B. Hastings, B. F. should be in writing.
Hastings, and P. W. Scott, for appelRank v. Garvey, 66 Neb. 767, 92 N. lee: W. 1025, 99 N. W. 666; Hetzel v. Lyon, Where real-estate broker em87 Neb. 261, 126 N. W. 997.
ployed for a commission presents to Where a contract is within the pur- the principal a proposed purchaser, it view of the Statute of Frauds there
is for the principal to decide whether must be a consideration for a modifi- the person is acceptable; and if, withcation by waiving some of the require- out fraud or concealment or other imments, or else a new agreement must
proper practice, he enters into a be executed, but if the terms of the
binding and enforceable contract for new agreement have been fully carried the sale of the land, the broker has out, the original obligation is dis- earned his commission and the seller charged.
should not be permitted to say that Bowman v. Wright, 65 Neb. 661, 91 the broker has not complied with the N. W. 580, 92 N. W. 580; Reynolds v. terms of his agreement. Burlington & M. R. Co. 11 Neb. 186, 7 Felthauser v. Greeble, 100 Neb. 652, N. W. 737; 10 R. C. L. 1035, 227. 160 N. W. 983; Scully v. Williamson,
To entitle a broker to a commission 26 Okla. 19, 27 L.R.A.(N.S.) 1089, 108 where no sale is actually consummat- Pac. 395, Ann. Cas. 1912A, 1265; Lined, he must either produce to the own- coln Realty Co. v. Garden City Land & er a customer who is able, ready, and Immigration Co. 94 Neb. 346, 143 N. W. willing to buy on the terms prescribed 230, Ann. Cas. 19140, 392; 4 R. C. L. by the owner, or else take from the
309; Mundy v. Meyer, 100 Neb. 296, customer a binding contract of pur- 159 N. W. 404. chase.
Error cannot be predicated upon a 9 C. J. 608, 193; Felthauser V.
rejected offer of proof not within the Greeble, 100 Neb. 652, 160 N. W. 983;
limits of a question asked. Lunney v. Healey, 56 Neb. 313, 44
Hans v. American Transfer Co. 90 L.R.A. 593, 76 N. W. 558; Bolton v. Neb. 834, 134 N. W. 943; Barr v. Post, Coburn, 78 Neb. 731, 111 N. W. 782. 56 Neb. 698, 77 N. W. 123; Pike v.
Wherever the performance of a Hauptman, 83 Neb. 172, 119 N. W. 231; broker's duties includes the procure- Havlik v. St. Paul F. & M. Ins. Co. 87 ment of a written contract in behalf Neb. 427, 127 N. W. 248. of his employer, the instrument se- The proofs must correspond with cured must be a correct embodiment the allegations in a complaint or anof the agreement negotiated, and in swer, and any departure in the evi
(- Neb. 181 N. W. 195.) dence from the substance constitutes tent of the parties, if it cannot be a variance and is fatal.
found in the contract. 21 R. C. L. 609; Cockins v. Bank of 5 Pom. Eq. Jur. 4th ed. p. 4914; Fry Alma, 84 Neb. 624, 133 Am. St. Rep. v. Platt, 32 Kan. 62, 3 Pac. 781. 642, 122 N. W. 16; Dennison v. Daily
Dorsey, C., filed the following News Pub. Co. 86 Neb. 862, 126 N. W. 764.
opinion: Where a broker's commissions are
The plaintiff, Theron C. Hecht, expressly conditioned upon consum
recovered judgment upon a directed mation of the contract to be negotiat- verdict against the defendant, Aled, it must be performed by the par- bert F. Marsh, upon a real-estate ties thereto to warrant recovery of the broker's written contract for the remuneration. If such performance sale of the defendant's land in Aris prevented by arbitrary action of
thur county, which provided for the the employer, the condition is thereby
payment of a stipulated cash comwaived, and he may recover his com
mission "if a sale is made, or a purmissions in spite of the fact that the contract is never consummated.
chaser therefor found, at the price 4 R. C. L. 311; Pfanz v. Humburg,
and upon the terms specified herein, 82 Ohio St. 1, 29 L.R.A.(N.S.) 534, 91 or at any other price or terms which N. E. 863; Alvord v. Cook, 174 Mass. I may hereafter authorize or ac120, 54 N. E. 499; Meltzer v. Straus,
cept. The terms specified were 61 Misc. 250, 113 N. Y. Supp. 583; that the land might be sold for Micks v. Stevenson, 22 Ind. App. 475; $9,600, of which $2,920 was to be 51 N. E. 492; Greenwald v. Rosen, 61
paid in cash, $2,100 by the purchasMisc. 260, 113 N. Y. Supp. 764. Where a contract is one required to
er assuming encumbrances in that be in writing by the Statute of Frauds, amount, and the balance to be arthere must be consideration for
ranged "to suit purchaser." modification by waiving some of its re
The plaintiff brought the defendquirements, or else such new agree
ant and one Jack Baker together, ment must be executed.
and on April 25, 1917, a written sale Bowman v. Wright, 65 Neb. 661, 91 contract was executed whereby BakN. W. 580, 92 N. W. 580; Lincoln
er agreed to purchase the land at Realty Co. v. Garden City Land & Im
$9,600, to be paid by his deeding to migration Co. 94 Neb. 346, 143 N. W.
the defendant a quarter section in 230, Ann. Cas. 19140, 392. There are two requisites essential to
Perkins county, assuming existing the exercise of equitable jurisdiction mortgages on defendant's land in in giving relief defensive or affirma
the sum of $2,100, and giving a tive. The fact concerning which the mortgage back to the defendant on mistake is made must be material to the land conveyed to Baker in the the transaction affecting its sub- sum of $3,500. This contract called stance, and not merely its incidents;
for the furnishing of good and suffiand the mistake itself must be so im
cient deeds and abstracts of title portant that it determines the conduct of the mistaken party or parties. mutually by the parties not later
than May 10, 1917. But about May 2 Pom. Eq. Jur. 4th ed. p. 1747;
1, 1917, Baker notified the defendHayes v. O'Brien, 149 Ill. 403, 23
ant by letter that he would not fulL.R.A, 555, 37 N. E. 73; Lamoreaux & Peterson v. Phelan, Shirley & Calla
fil the contract, and it was never han, 89 Neb. 47, 130 N. W. 988.
carried out, the defendant taking no A decree of specific performance steps to enforce it. may be entered where the contract is
In his petition the plaintiff set certain and complete, or contains pro
out the broker's contract and alleged visions which are capable in them
that the sale contract above menselves of being reduced to certainty, tioned was entered into through his and from which the intention of the efforts pursuant thereto; that he parties can be clearly ascertained. had fully performed and was en
25 R. C. L. 218; Parkhurst v. Van titled to the stipulated commission, Cortland, 14 Johns. 15, 7 Am. Dec. 427. for which he prayed judgment.
Parol evidence cannot show the in- The answer set up Baker's failure to comply with the terms of the sale that the defendant's agreement uncontract, and averred that at the der the written contract to pay the time of the negotiations with Baker stipulated commission in case the the defendant insisted that a forfeit plaintiff made a sale on terms satisbe deposited, and stated that he factory to the defendant was would not sign a contract without changed, by subsequent oral agreesuch forfeit, and that, in order to ment, into a promise to pay it only secure his signature to the contract, in the event that the purchaser the plaintiff orally, agreed with the should perform his contract. If, defendant to waive any claim to therefore, the rule of the cases last commissions unless the sale should cited is to be rigorously applied, be completed in accordance with the there was no error in the exclusion terms of the contract. These allega- of the offered evidence. tions were put in issue by reply. If there is any factor in the in
The defendant offered parol evi- stant case which removes it from the dence at the trial to prove, in sub- operation of that rule, it must be stance, that after the negotiations found in the fact that when, accordbetween Baker and himself were ing to the defendant's offered proof, about to fail because of Baker's in- the negotiations were about to fail ability to post forfeit money, the
because of Baker's inability to meet plaintiff, in order to prevent a fail- the defendant's terms, the plaintiff ure of negotiations and to induce interposed between the parties, and the execution of a contract of sale, offered the defendant an inducement orally agreed to make his claim for to waive his right to insist upon commissions in the transaction con- those terms, by promising not to tingent upon the purchaser's com- claim commissions if Baker did not pliance with the contract. The of perform. Taking the defendant's fered evidence was excluded, and an offer of proof as true, the situation issue of law is thus squarely pre- was that Baker was not ready to sented as to whether a contract be- deal upon the terms upon which the tween a landowner and a broker, defendant had authorized the plainrequired by the statute to be in writ- tiff to sell his land. Instead of ing, is susceptible of subsequent $2,920 in cash, he proposed to pay parol modification with respect to no cash at all, but to put in his land the compensation provided for in Perkins county as the equivalent therein.
of $4,000 of the purchase price. Not It has been held by this court that only was Baker's proposition a the general rule prohibiting the sub- material departure from the terms sequent oral modification of con- upon which the defendant had autracts required by the statute to be thorized his land to be sold, but in writing applies only with respect Baker was unwilling or unable to to those provisions which the statute comply with the custom in such expressly requires to be contained transactions and to put up forfeit in the writing in order to make it money as an evidence of good faith. valid. Hetzel v. Lyon, 87 Neb. 261, Under those conditions it would not 126 N. W. 997; Rank v. Garvey, 66 be unlikely that the defendant was Neb. 767, 92 N. W. 1025, 99 N. W. reluctant to approve the proposition 666. Two provisions only are spe
and to enter into a contract for the cifically mentioned in $ 2628, Rev. sale of his land, thus subjecting Stat. 1913, as essential to contracts himself to the payment of commisemploying brokers to sell land, sions, without adequate assurance namely, that the land be described that Baker would perform on his and the compensation set forth. part. The modification which the defend- It was, moreover, the defendant's ant set up in his answer and offered absolute right to stand upon the to prove in the instant case relates terms embodied in his authority to to the compensation. The plea is the plaintiff to sell the land, and to
(- Neb. 181 N. W. 135.) refuse to negotiate with Baker upon refused to fulfill Will the fact that other terms. According to the de- the contract was within the Statute fendant's offered proof, that was his of Frauds prevent its subsequent attitude until the plaintiff inter- oral modification under circumvened with his offer to claim no com- stances which, in the case of a conmissions if Baker should fail to car- tract not within the statute, would ry out his contract.
estop a party to it from denying the If the defendant had persisted in modification ? his refusal to deal with Baker on the In Simonton, Jones & Hatcher v. altered terms, it will not be contend- Liverpool, L. & G. Ins. Co. 51 Ga. 76, ed that the plaintiff would have been the following rule is announced entitled to commissions, because the "Equity will not allow the Statute of latter would have failed in the pri- Frauds to be used as an instrument mary condition of his right to com- of fraud, and will decree specific missions, which was to produce a performance, or hold the maker of purchaser able, ready, and willing a parol contract estopped from deny. to buy upon the terms of the con- ing it, when the other party, by tract, or upon any others that the virtue of it, and undefendant might approve.
Estoppel-to And if der and in pursu- take advantage the defendant had consented to the ance of it, has so far of absence of altered terms, without any induce- acted as that it ment being held out to him by the would be aiding in a fraud to permit plaintiff, his liability for commis- the contract to be repudiated. And sions would be unquestionable. But what equity would do, our courts of in the instant case we have the ad- law, under proper allegations, will ditional element of persuasion or in- also do." ducement utilized by the plaintiff to When applied to this case, the rule overcome the defendant's objections would mean that, if the plaintiff, by to the altered terms, in the form of his conduct in assuring the defendan express promise to relieve the de- ant that he would be out nothing in fendant of any liability to him if commissions if Baker failed to perBaker did not perform. The ques- form, lulled the defendant into a tion is whether such a waiver, not in sense of security, induced him to writing, under the accompanying abandon objections upon which he circumstances of influence exerted had the right to insist, and persuadupon the defendant to overcome his ed him to make a contract that he resistance and induce him to execute would not otherwise have entered ina contract that he would not other- to, equity would not permit the wise have entered into, will operate plaintiff to repudiate his oral agreeto modify the plaintiff's right to ment on the ground of the Statute of commissions under the written Frauds. broker's contract.
Gerard-Fillio Co. v. McNair, 68 Aside from the special circum- Wash. 321, 123 Pac. 462, is a case stance that the writing was one in which the facts bear considerable within the Statute of Frauds, we similarity to those in the instant should instantly say that the situa- case. There the broker, in order to tion presented was such as general overcome the objections of his princonsiderations of equity ought to cipal to a certain proposed exchange preclude the plaintiff from taking which was not according to the advantage of. Yielding to the infly- terms prescribed in his written auence of the plaintiff's offer to waive thority, consented, in lieu of the commissions if the purchaser failed agreed commission, to accept a sum to perform, the defendant waived of money and the conveyance of certhe terms upon which he had the tain lots. The principal thereupon right to insist, and entered into a entered into the exchange, the propcontract which, within a week, the erties changed hands, and the prinpurchaser expressly repudiated and cipal paid the sum of money and