ASSOC. REALTY COMPANY v. Cadillac Jack Enterprises, Inc.

McWilliams, J., delivered the opinion of the Court. Once more we are engrossed in the arbitrament of a wrangle between a real estate broker and his customer. The trial judge, Carter, J., ordered the broker to return $3,500 of an $8,000 deposit he had retained as his commission. We shall affirm Judge Carter’s action. “Cadillac Jack” is the nom de guerre of Wilbur F. Haugh, who claims to be the sole owner of appellee, 1 a once prosperous used car business in Harford County which he conducted on a 10 acre tract situate on the east side of U. S. Route No. 1 (Belair Road) about 3 miles south of Belair.

Pressed by creditors, Haugh, in October 1963, commissioned appellant (Adler) 2 to find a purchaser for the property. He executed one of the printed Standard Listing Contract forms (first making minor revisions) of the Real Estate Board of Greater Baltimore (the Board) giving Adler authority, for 3 months only, to sell the property for $185,000. The listing contract was solicited by Veri J. Edwards (Mrs. Edwards), an employee of Adler. Adler said Mrs. Edwards was a personal friend of Haugh and had known him for 20 years.

In February 1964, the October listing having expired, a new listing contract was signed by Haugh. This was for 6 months. The sale price ($185,000) remained the same. Nine months later, in October 1964, Haugh signed still another listing contract on the same terms, except that its duration was for 3 months instead of 6 months.

It should be remembered that each of the 3 listing contracts provided that Adler’s commission was to be based on the “Standard Schedule of Commissions” (the Schedule) promulgated by the Board, which is set forth, in part, below: • “(a) Improved Commercial and Industrial Property (including retail store properties, office buildings ³⁷³ and apartments) : 6% on the first $50,000, 5% on the next $450,000, and 3% on the balance in excess of $500,000. “(b) Special Utility and/or Special Effort Properties—Theatres, churches, wharf properties, abbatoirs, mill properties, dairies, laundries, distilleries, breweries as well as special effort properties: 7% % ; higher rates may be charged not in excess of 10% when specified in the original employment agreement or listing contract.” The October 1964 listing contract expired on 18 January 1965. At or about that time Mrs. Edwards persuaded Winston B. Osborne, to whom she had shown the property some months earlier, to offer $80,000 for it. He gave her a down payment of $500. She returned to the office and saw to the preparation of the agreement of sale, in which Osborne agreed to pay an additional $7,500 upon the execution of the agreement by the seller, Haugh.

The agreement required the seller to pay Adler a commission “in accordance with the [Board’s] Schedule.” Also included in the agreement was a provision that it contained “the final and entire agreement between * * * parties * * * and [that | neither * * * [of them] shall be bound by any terms, conditions or representations not [t] herein written.” She obtained Osborne’s signature and the agreement was then sent to Haugh. The record is silent in respect of what, if anything, happened between the signing of the agreement of sale by Osborne and a meeting which was held at Karson’s Inn on Holabird Avenue on 28 January 1965. Present at the meeting were Haugh, a young woman said by some to be his “girl friend” and by others to be his nurse, Adler, Mrs. Edwards, John T. Smith, whom Haugh identified as vice president of the appellee, and Mrs. Smith. Xo minutes of this meeting appear in the record but one’s first guess would be that the principal item on the agenda was the disparity between Haugh’s asking price of $185,000 and Osborne’s offer of $80,000.

The record suggests that Llaugh was not in the best of moods, at the time, and that he may have been somewhat difficult; not without reason it seems. Dur ³⁷⁴ ing 1953 and 1964 he had been treated at Spring Grove State Hospital for alcoholism. Judgments against him amounted to about $85,000. His business had gone down the drain and he seems to have suspected that Adler’s failure to obtain a better offer was more the result of indifference and inertia than any lack of marketability of his property.

After what Adler described as a “big hassle” Haugh signed the agreement of sale and the following statement written in longhand on a “Cadillac Jack” letterhead (the addendum) : “Jan. 28, 1965 T, Wilbur F. Haugh, trading as “Cadillac Jack Enterprises, Inc.,” signed the attached contracts with the understanding that said contracts must meet the approval of John T. Smith vice president of said corporation. ‘It is understood and agreed that Associated Realty Company, agents for “Cadillac Jack Enterprises, Inc.” and Wilbur F. Haugh will as agents and through their attorney Mr. Heath contact each creditor and settle said outstanding obligations in the most advantageous manner. T want 25,000.00 net for complete settlement on final signature. By Wilbur F. Haugh ? f $20,000.00 ) ? ' j To 25,000.00 | ' “John T. Smith Associated Realty Co. Veri J. Edwards, Agt.” Adler contends there was a “verbal” agreement for a 10% commission. “He [Haugh] was not only going to give ten percent, he was going to give us a thousand dollars 3 to pay the attorney to compromise these deals.” Asked why he didn’t “get a written contract” providing for a 10% commission, Adler said, “I guess because we were stupid; we assumed there ³⁷⁵ wouldn’t be any question about it.” The following excerpt from the cross-examination of Adler is revealing: “Q. All right. Now you say this ten percent contract is a verbal contract, as you put it, when did this arise ? “A. As far as I was concerned it never arose, it was an understanding. “Q. You are saying you got a ten percent verbal contract, is that what you say ? “A. From Mrs. Edwards. “Q. When did you get it? “A. When we first got the contract. “Q. In October? [1963] “A. When she gets on the stand you can ask her.” Mrs. Edwards specifically denied that she had any negotiations with Haugh or with anyone else concerning commissions.

She said a 10% commission was discussed at the 28 January meeting but she was “not positive as to any definite decision on it.” We quote from the cross-examination of Mrs. Edwards: “Q. Now you say the subject of commissions arose at that time ? [ 28 January meeting] “A. It was discussed. Of course I had no right to enter into the discussion because I was not the broker involved. “Q. Do you recall who brought up the discussion? “A. Mr. Adler brought up the discussion. “Q. And what did he claim as to towards commission, he said he was entitled to ten percent ? “A. Yes. “Q. And what was the response from Mr. Haugh? “A. Mr. Haugh kept saying “no, no, no, no.” Daniel Wagner, a certified public accountant and a member of the bar, testified he was engaged by Haugh “to see [the] settlement through.” He said he undertook negotiations with Haugh’s creditors and succeeded in reducing the liens from $85,000 to about $61,000. He had trouble accomplishing this, he said, because the creditors were upset and unhappy. They ³⁷⁶ had been irritated by the earlier approach of another person (either Adler or Mrs. Edwards).

He (Wagner) telephoned Adler several days before the settlement to learn how much of the $8,000 deposit would be “forthcoming from Associated Realty at the date of settlement.” Asked what had been Adler’s reaction he said: “A. He indicated to me that this was not so, that the commission would be ten percent and that if the commission of ten percent was not agreed to he would take his prospective purchaser that signed the contract into another property and that the sale would not go through.” (Emphasis supplied.) When he reported this, Haugh told him there had been talk (at the 28 January meeting) about a 10°/o commission