Opinion
No. 91-CV-114.
Decided April 14, 1992.
Margaret B. Apel and Stephen C. Rodeheffer, for plaintiff.
James P. Miller, for defendant.
This matter came before the court on January 24, 1992, pursuant to defendant's motion for summary judgment filed July 22, 1991. Upon consideration of the oral argument, as well as the memoranda, affidavits and exhibits presented by the parties, the court hereby renders the following decision.
Plaintiff John Hanes alleges in the instant action that defendant entered into a contract to sell certain real estate to the plaintiff, and that defendant subsequently breached the contract by selling the subject real estate to another party. In his second cause of action, plaintiff submits that he, as a licensed real estate salesman, is entitled to one half of the listing commission agreement that Donald E. Fender, Inc. had with defendant.
In support of her motion for summary judgment, defendant asserts that she never entered into a binding contract with plaintiff, that there is no writing between the parties which would satisfy the Statute of Frauds, and that pursuant to the terms of R.C. 4735.21, plaintiff cannot maintain an action in his own right for commission.
Defendant herein, Susan L. Davis, is the acting Administrator W.W.A. of the Estate of Hazel Durnell; acting in said capacity, she entered into an exclusive residential sales agency agreement with Donald E. Fender, Inc. ("Fender"), a real estate broker, to sell property which had belonged to the deceased, located at 634 North High Street in Hillsboro, Ohio. Under the terms of this agreement, Fender was given the exclusive right to sell the real property and its contents for $250,000, with commission to be paid at six percent of the sale price.
Plaintiff himself worked for another real estate broker and, having learned of the listing of the aforementioned property, made an offer to buy the property for $250,000, contingent upon plaintiff's obtaining the necessary financing. The purchase contract submitted by plaintiff to defendant on January 31, 1990 was rejected by the defendant in a writing dated February 2, 1990. Plaintiff consequently brought this action, seeking monetary damages for breach of contract and loss of commission.
In order for the plaintiff to recover on his contractual theory he must show that a valid contract existed between the parties, complete with a meeting of the minds, an offer on the one side and an acceptance on the other side. Noroski v. Fallet (1982), 2 Ohio St.3d 77, 2 OBR 632, 442 N.E.2d 1302. An "offer" has been defined in Ohio case law as "`the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it,'" Leaseway Distrib. Centers, Inc. v. Ohio Dept. of Adm. Serv. (1988), 49 Ohio App.3d 99, 105, 550 N.E.2d 955, 961, quoting from Restatement of the Law 2d, Contracts (1981) 71, Section 24.
Several courts have had the occasion to differentiate listing agreements, to which the potential vendor and his broker are parties, from offers, to which the potential purchasers and vendors are parties. A listing agreement is nothing more than authorization for a real estate broker to find a purchaser, Holland v. Hannan (D.C.App. 1983), 456 A.2d 807, 817; it is not addressed to and/or an offer to any certain prospective purchaser or the public in general, id. and MacNaughton v. Cossin (Me. 1985), 493 A.2d 1040, 1042; and, at its very best, the listing agreement constitutes an invitation for third parties to make an offer, Roskwitalski v. Reiss (Pa. 1985), 487 A.2d 864, 867. One who agrees to purchase the property and incorporates the terms of the listing agreement into a sales agreement is generally viewed as the offeror. Id. and Boesch v. Gettysburg Products (1957), 104 Ohio App. 248, 250, 4 O.O.2d 394, 394-395, 148 N.E.2d 102, 104.
There is no evidence before this court that plaintiff and defendant ever mutually assented to enter into a contract, or that defendant ever made an offer to the plaintiff. Under this set of circumstances, plaintiff's "Purchase Contract" was merely an offer that defendant never accepted. In fact, the defendant promptly and unequivocally rejected the offer.
The plaintiff apparently relies upon the existence of the listing agreement to assert that defendant made an offer for the sale of the subject real property, for this is the only signed writing presented to the court wherein the defendant states the terms of the sale that were agreeable to her. Such listing agreement simply does not constitute an offer which plaintiff had the power to accept. The listing agreement was obviously an agreement entirely between defendant and the real estate broker in which no third-party acceptance was ever contemplated. At best, the listing agreement could be considered an invitation for third parties to make offers.
The plaintiff effectively made an offer when he signed the purchase contract on January 31, 1990. There is no question as to the fact that this offer was rejected by the defendant; nor is there affirmative evidence of any act taken by defendant or her real estate broker which could be construed as an acceptance prior to defendant's rejection of plaintiff's offer. Under these circumstances, reasonable minds could come to but one conclusion, i.e., that no contract ever came into existence between plaintiff and defendant; therefore, the defendant is entitled to summary judgment on the breach-of-contract claim.
Although the parties in their memoranda discussed the issue of compliance with the Statute of Frauds, the court finds that any discussion of this issue would be merely advisory, inasmuch as plaintiff has failed to prevail on the threshold issue of whether a contract existed between the parties.
Defendant opines that she is entitled to summary judgment on the issue of whether plaintiff is entitled to recover for commission lost, based upon the provisions of R.C. 4735.21, which provides in pertinent part as follows:
"Nor shall any real estate salesman or foreign real estate salesman commence or maintain any action for a commission or other compensation in connection with a real estate or foreign real estate brokerage transaction, against any person except a person licensed as a real estate broker or foreign real estate dealer under whom he is licensed as a salesman at the time the cause of action arose."
The uncontroverted evidence in the case sub judice reveals that plaintiff was a licensed real estate salesman working under the auspices of Flach Real Estate, Inc. at the time that he claims he became entitled to a commission. If the plaintiff was entitled to a commission at all, he would have to bring an action against Flach Real Estate, Inc. for the commission rather than seeking compensation from the defendant, who is not a licensed real estate broker.
Assuming arguendo that plaintiff has a right to recover, such right is limited by R.C. 4735.21 to a claim against his broker. Snyder v. Schaaf (Jan. 5, 1984), Franklin App. No. 83AP-481, unreported, 1984 WL 4589. The court hereby grants summary judgment in favor of the defendant on the issue of commission.
In conclusion, the court finds there is no genuine issue of material fact and defendant is entitled to judgment as a matter of law on the claims for breach of contract and commission. Summary judgment in favor of the defendant is hereby granted.
Judgment for defendant.
ROBERT P. RINGLAND, J., of the Clermont County Court of Common Pleas, sitting by assignment.