Summary
In Watson v. Muskegon Steamship Corp. (208 App. Div. 158) the inference was permitted that the plaintiff's commission was conditioned upon performance by the purchaser of a contract for the sale of a steamship.
Summary of this case from Caldwell Co., Inc., v. Connecticut Mills Co.Opinion
February 21, 1924.
Edmund R. Terry [ Edward L. Blackman of counsel], for the plaintiff.
Duer Taylor [ Robert S. Johnstone of counsel; Leland B. Duer and George Winship Taylor with him on the brief], for the defendant.
This is an action for a broker's commission claimed by plaintiff in having procured on behalf of the defendant the sale of a steamship.
The defendant entered into a contract of sale whereby, among other things, it was agreed that ten per cent of the purchase price should be deposited with certain bankers, to be paid to the seller upon tender of delivery of the ship, said ten per cent to be retained by the seller as liquidated damages in the event of default by the buyer. The purchaser repudiated the contract and refused to accept delivery. The depositary refused to pay the ten per cent to the defendant on demand, and the latter sued the depositary and recovered a judgment for said amount.
According to the testimony of the plaintiff, he presented to the defendant one Marskey as a prospective purchaser of the ship, and it was orally agreed that the defendant would pay plaintiff as broker a commission of two and one-half per cent.
On the other hand, according to the defendant's testimony, the plaintiff approached and dealt with the defendant as principal, and there was no agreement to pay him any commission, but that there was an agreement to allow a discount of two and one-half per cent off the purchase price of the ship, and that it was not until the execution of the contract of sale that Marskey's name was substituted as purchaser and a written direction received from Marskey to pay the two and one-half per cent to plaintiff as a commission. In reply to this direction, defendant wrote Marskey as follows: "Acknowledging receipt of your favor of even date, we beg to state that in accordance with the representations and directions therein contained, we will, upon the consummation of the purchase and sale referred to, pay a commission of two and one-half per cent. to Mr. Samuel S. Watson." This letter was introduced in evidence by the defendant over the objection of the plaintiff.
There thus were presented two distinct theories: (1) That there was an oral agreement as claimed by plaintiff, of which the writing was corroborative only, said writing, however, not constituting the agreement; and (2) that the writing constituted the only agreement to pay the commission. One theory or the other must have been adopted, but neither theory could have been adopted without determining issues of fact presented by the evidence. These issues should have been presented to the jury.
In the event that the jury should find for the defendant on this issue, namely, that the letter constituted the only agreement between the parties, an ambiguity was presented in the wording of this letter which required its meaning to be submitted to the jury in the light of the surrounding circumstances. ( Utica City Nat. Bank v. Gunn, 222 N.Y. 204; United States Rubber Co. v. Silverstein, 229 id. 168.) The ambiguity resides in the use of the words in the letter "upon the consummation of the purchase and sale." Ordinarily when such words are used in connection with a commission due a broker, they relate to the signing of a contract of sale. In the case at bar, however, the person to whom the letter in question was addressed was not the broker, but the principal who had just signed contemporaneously with the delivery of the letter a contract of sale in which the same words "consummation of the purchase and sale" were used as clearly to mean not the signing of the contract of sale, but the carrying out and completion of said contract. Article X of the contract of sale provides as follows: "This contract has been executed as a single instrument and not in duplicate and will be deposited immediately after execution with the said Harvey Fisk Sons, bankers, to be held pending the consummation of the purchase and sale and delivery of proper bill of sale as herein provided, and in the event that such purchase and sale is not consummated this contract is to be returned to the seller upon demand."
When in addition is considered the testimony of the defendant that there was no agreement to pay a broker's commission but merely a recognition of the right of the purchaser to dispose of the discount from the purchase price, it clearly appears that the ambiguity was for the jury.
It is urged by plaintiff that the defendant, having proceeded to recover the liquidated damages provided by the contract, has secured the benefit contemplated by the contract procured by the broker, and hence the broker has earned his commission. (Citing Gilder v. Davis, 137 N.Y. 504.) In so contending, however, the plaintiff ignores the fact that the very question at issue in the case at bar is whether the plaintiff has expressly contracted that he is only to be paid a commission in the event of a certain contingency. In Gilder v. Davis ( supra) there was nothing to prevent the collection of the entire commission upon the signing of the contract, as in the usual brokerage contract until the broker by subsequent agreement had limited his right thereto.
It follows that the exceptions of the defendant should be sustained, and the motion for a new trial granted, with costs to the defendant to abide the event.
CLARKE, P.J., SMITH, MERRELL and MARTIN, JJ., concur.
Exceptions sustained and new trial granted, with costs to defendant to abide the event. Settle order on notice.