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Schanerman v. Everett and Carbin Inc.

March 5, 1952

FREDERICK SCHANERMAN, PLAINTIFF-RESPONDENT,
v.
EVERETT AND CARBIN, INC., A CORPORATION OF NEW JERSEY, DEFENDANT-APPELLANT



McGeehan, Jayne and Wm. J. Brennan, Jr. The opinion of the court was delivered by William J. Brennan, Jr., J.A.D. Jayne, J.A.D. (dissenting).

Brennan

Defendant appeals from a judgment entered for plaintiff in the Law Division, Hudson County, upon a jury verdict.

The parties are licensed real estate brokers. Defendant was paid a commission of $3,525 for effecting a sale at $90,000 of an apartment house of Prudential Insurance Company to G.M.E. and C. Corporation. Plaintiff's judgment amounts to one-half of that commission plus interest.

We need consider only one ground of error alleged, namely, that the trial court improperly denied defendant's motion for involuntary dismissal at the end of plaintiff's case.

Accepting plaintiff's evidence as true and giving him the evidential benefit of all inferences logically and legitimately to be drawn therefrom, Marschalk v. Weber , 11 N.J. Super. 16

(App. Div. 1950), certif. den. 6 N.J. 569 (1951), he proved that C. V. Everett, defendant's president, employed him to produce a buyer "ready, willing and able" to buy the property at the same $90,000 price paid by G.M.E. and C. Corporation, and promised to pay one-half of the commission "coming from Prudential" for the services, telling him that G.M.E. and C. Corporation regretted its bargain and "wanted to get out from under" the contract. Plaintiff produced one Driver, and Everett accepted Driver's $500 check as an initial deposit. Everett prepared a proposed contract between G.M.E. and C. Corporation and Driver for a sale at $90,000 to be closed May 15, 1950. Driver's attorney suggested some changes to which Everett agreed. Driver executed the instrument and it was delivered to Everett together with Driver's $3,000 "deposit" check. However, G.M.E. and C. Corporation refused to sign the agreement. On April 27, 1950, Everett sent the $500 and the $3,000 checks to plaintiff for return to Driver with a letter stating "very much to my surprise and chagrin Mr. Garfinkel and Mr. Mettle concluded at the last moment that they will not dispose of the property at this time." Garfinkel and Mettle are principals of the G.M.E. and C. Corporation.

Defendant's motion was grounded in part on the alleged absence of sufficient proof at the trial of Driver's financial readiness and ability to complete the purchase. The terms of payment provided in the proposed agreement are $3,000 "deposit," $20,500 "cash" on delivery of deed, and $66,500 "subject to a first purchase money mortgage held by Prudential Insurance Company." The $3,000 "deposit" was made, which sufficed as evidence to prove Driver's ability to meet that part of the purchase price; and, as the conveyance was to be "subject to" the $66,500 mortgage, no evidence of financial readiness and ability was necessary as to that amount. There was, however, insufficient evidence that Driver was prepared and able to meet the $20,500 "cash" payment. His payments aggregating $3,500 are not prima facie proof of his ability to meet the much larger payment at

its due date. Cf. Homan v. Griffin , 94 N.J.L. 345 (Sup. Ct. 1920).

In accordance with general principles governing the burden of proof in civil actions, plaintiff was obliged to bear the burden of establishing that he had performed his agreement. 8 Am. Jur., Brokers, sec. 222, p. 1117. Proof of performance in a case such as this must usually include proof of the financial readiness and ability of the offered purchaser to complete the transaction. The broker is not relieved of the burden of proof of establishing the purchaser's readiness and ability to complete the transaction merely because, as here, when the offer was presented there was no objection on the ground that the purchaser was not ready, willing and able to buy. Colburn v. Seymour , 32 Colo. 430, 76 P. 1058 (Colo. Sup. Ct. 1904); C. O. Frick Co. v. Baetzel , 71 Ohio App. 301, 47 N.E. 2 d 1019 (Ct. App. Ohio , 1942); Dreyfuss et al. v. Boling , 60 A. 2 d 230 (Mun. Ct. App. D.C. 1948); Abbott v. Floyd , 136 Cal. App. 365, 28 P. 2 d 929 (Dist. Ct. App. 1934); Annotation , 156 A.L.R. 602, 611; but see Stanton v. Barnes , 72 Kan. 541, 84 P. 116 (Kan. Sup. Ct. 1906). Of course, plaintiff earned his commission if he performed his engagement, whether or not G.M.E. and C. Corporation accepted Driver's offer; the contract, as testified to by plaintiff, did not condition the payment of the commission upon the owner's acceptance of any offer produced, and defendant is liable if the offer, though rejected, met the authorized terms. But when Driver's offer was rejected, neither G.M.E. and C. Corporation nor Everett was questioning plaintiff's services or Driver's financial readiness and ability. In effect the property was withdrawn from the market and plaintiff's agency was terminated. If at that time plaintiff had performed his services he was entitled to his commission; otherwise, he was not. The burden, however, was upon him to show that he had performed and an essential element of his proof of performance was that Driver was a purchaser ready, able and willing to buy. Dreyfuss v. Boling, supra.

What was said in the Seymour case by the Colorado Supreme Court may be adapted ...


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