Opinion
March 6, 1952 —
April 8, 1952.
APPEAL from a judgment of the circuit court for Racine county: ALFRED L. DRURY, Circuit Judge. Affirmed.
For the appellants there was a brief by Harvey Harvey of Racine, and oral argument by Richard G. Harvey.
For the respondent there was a brief by Flynn Greenquist of Racine, and oral argument by Kenneth Greenquist.
Action by plaintiff L. W. Smith Company against defendants Wesley J. Romadka and Emilie Romadka, his wife, to recover damages under a real-estate broker's listing contract between the parties. From a judgment for the plaintiff, defendants appeal.
The case arises out of the following facts which were stipulated by the parties: Defendants were owners of certain real estate in Racine which they listed with the plaintiff corporation for sale under an agreement dated December 8, 1949. The agreement provided, in part:
"If a sale or exchange is made or a purchaser procured therefor by you, by the undersigned, or by any other, at the price and upon the terms specified herein, or at any other terms and price accepted by the undersigned, during the life of this contract, or if sold or exchanged within six (6) months after the termination hereof to anyone with whom you negotiated during the life of this contract and whose name you have filed with me in writing prior to the termination of this contract, the undersigned agrees to pay you a commission of five per cent (5%) above sale price [$12,600]."
On December 10, 1949, plaintiff secured a purchaser for the property, one Paul Kuzia, who submitted to defendants through the plaintiff a written offer to purchase for $12,000. The offer was left with the defendants overnight and returned to plaintiff the following day. Defendants declined the offer. No other offers were submitted by the plaintiff and no list of persons with whom it had negotiated was supplied to the defendants. On January 8, 1950, the contract expired, and defendants thereafter listed the property with another broker. Subsequently, Paul Kuzia made an identical offer to purchase through the second broker. This offer was accepted by defendants, and the property was sold on March 3, 1950, for the sum of $12,000, the commission to the second broker being deducted from that amount.
The facts being stipulated, the case was submitted to the circuit court on briefs, and the court held that the delivery of the written, signed offer to the defendants, which they kept overnight, constituted a filing of the name of Paul Kuzia in compliance with the requirements of the contract, and entered judgment for the plaintiff in the sum of $600 plus interest and costs.
Appellants' counsel argues that the words used in the contract, "whose name you have filed with me in writing," require respondent to deliver a written list of names to appellants for their permanent record. several cases are cited relating to documents, such as chattel mortgages and corporate articles of organization, required by law to be filed with a governmental agency for the purpose of making them a matter of public record.
Here there is no public relationship involved and no statutory requirements for filing. The law governing the relationship between parties to a contract such as this is stated in 12 C.J.S., Brokers, p. 215, sec. 92, as follows:
"An owner who has knowledge that a certain broker first interested a customer with whom negotiations are still pending proceeds at his peril in closing a deal with such customer through another broker and paying a commission to the latter broker; and he cannot thereby avoid liability to the first broker. Conversely, the owner is not liable to the first broker where, at the time of closing the deal through the agency of another broker, he is without knowledge or notice that the purchaser is the customer of the first broker, or where the second broker represents that he is making the purchase personally and the owner is without knowledge, notice, or intimation that he is representing a prospective purchaser first procured by the first broker."
The object of the contract provision here involved is to give notice to the owners of the names of those persons to whom they may not sell the property within the time specified in the contract without making themselves liable for the payment of the commission stated therein.
It would be useless to require the "filing" of such a list to be made in the manner that a document must be filed to make it a matter of public record. The definitions urged by appellants state that filing means the depositing in the custody or among the records of an official or officer, and the making of a proper indorsement and retention by such officer. In formally placing the list of names in the hands of the owner, a broker could not be assured that the owner would "file" it in the sense used in the definitions quoted. When respondent supplied appellants with the written offer to purchase, bearing the name of Paul Kuzia, and left it with them overnight, it gave them all the notice it could that a sale of the property to him during the time stated in the contract would make them liable for payment of the commission. Whether appellants "filed" it, returned it, or threw it away, it had served its purpose when it put them on notice that respondent had procured Paul Kuzia as a possible purchaser of the property.
Respondent complied with the provisions of the contract when it delivered the offer to purchase, and appellants became liable for the payment of the commission agreed upon when they sold the property to Kuzia within six months after the termination of the contract.
By the Court. — Judgment affirmed.