Mayne v. Eig

²⁷⁴ Brune, C. J., delivered the opinion of the Court. This is a suit by real estate brokers for commissions on the sale of a tract of land and the improvements thereon. The sellers denied liability for any commissions. The case was tried in the Circuit Court for Montgomery County before Judge Reeves and a jury, and resulted in a verdict in favor of the brokers for $10,000 and judgment thereon, from which the sellers appeal.

The two principal questions presented at the trial were, first, whether or not there was a special agreement between the sellers and the brokers that there would be no commissions payable to the brokers if the net amount received by the sellers did not exceed $200,000, and second, whether or not the brokers had acted in good faith or were representing the purchaser, rather than the sellers of the tract. A third question, which is essentially a variant of the second, was and is whether or not the brokers were representing both parties, without the knowledge of the sellers that they were so doing. The second and third questions will be treated together. A fourth question relates to the measure of damages and evidence relating thereto.

The sellers, defendants below and appellants here, are Mehrl E. Mayne and his wife and their two sons Edward F. Mayne and Mehrl F. Mayne and their respective wives. They owned a tract of about 204 acres of land and the improvements thereon at or near the intersection of Shady Grove Road and U. S. Route 240 in Montgomery County, which they operated as a farm. James W. Kibbie, a real estate salesman, on June 12, 1955, entered the employ of Eig & McKeever, the plaintiffs below and appellees here, who were licensed real estate brokers. Kibbie was a friend of one of the younger Maynes.

The latter told Kibbie in June, 1955, that his family was interested in selling the farm and asked Kibbie to visit the farm, look it over and sell it, if he could. After visiting and inspecting the farm and conferring with Mehrl E. Mayne and Mehrl F. Mayne, Kibbie reported on the matter to John E. McKeever, one of the members of the firm of Eig & McKeever, and the farm was then shown ²⁷⁵ to Mr. Sam Eig. The latter is the father of Lawrence Eig, who is the other partner in the firm of Eig & McKeever. During the negotiations which followed Kibbie sought unsuccessfully to obtain an exclusive sales listing of the Mayne farm, and the Maynes stated that their price was $200,000 net.

There was a conflict in testimony as to whether or not Kibbie had agreed to accept a net listing or had told Edward Mayne that Eig & McKeever would expect a commission of 5% on the sales price and could not accept net listings because they were illegal and unethical. Edward F. Mayne, one of the defendants, who became a real estate salesman after the contract for the sale of the farm was signed, conceded at the trial that Kibbie could not have accepted a net price contract, but denied knowledge of this at the time of the negotiations. 1 Sam Eig made one or two offers of a less amount than $200,000, which the sellers rejected. At a conference in Sam Eig’s office on July 7, 1955, he made an offer of $200,000, which was orally accepted by the Maynes. One of them then stated that this figure was to be the net amount which the sellers were to receive.

Sam Eig said that any dispute over commissions was a matter between the sellers and the brokers. No agreement was reached on that subject during the conference. McKeever, who was one of the participants in the conference, drafted a contract of sale dated July 7, 1955, the “date of acceptance” of which is stated as July 8, 1955. It was signed by Sam Eig as purchaser and by all six of the Maynes as sellers.

This contract provided, among other things: that the sale price was to be $200,000, of which $5,000 was paid as a deposit; that $60,000 (including the $5,000 deposit) was to be paid at the date of conveyance; that the balance of $140,000 ²⁷⁶ should be secured by a first deed of trust on the premises and should be payable in instalments over a period of 48 months, with interest at 4%, and that the purchaser might pay off .the entire balance at any time; that settlement should take place on or before April 15, 1956; that the property should be conveyed “to Sam Eig or his designees or assigns;” that at the request of the purchaser any 30 acres in the tract should be released from the lien of the purchase money deed of trust and that additional land should be released on payment of $2,000 per acre. The only other provision of the contract calling for special note is this paragraph contained in the printed portion thereof: “Agency. The Sellers recognize EIG & McKEEVER as the agent negotiating this Contract and agree to pay ...... commission for services rendered, same to be due and payable upon signing of this Contract. The entire deposit shall be held by the Agent until settlement hereunder is made and the party making settlement is hereby authorized and directed to deduct the aforesaid commission from the proceeds of sale and pay same to said Agent.

If the sale is not closed because of the Purchaser’s default the commission shall not exceed the amount of the deposit.” There was testimony to the effect that McKeever discussed •commissions with Edward F. Mayne when the contract was presented to the latter for signature on July 8th, but that no .agreement was reached. Sam Eig designated Silver Spring Shopping Center, Inc., a corporation controlled by him, as the party to which the tract was to be conveyed. There was a conveyance of one part of the tract consisting of about three and one-half acres in October, 1955. No question of commissions came up at that settlement.

It took place in the office of Mr. Wheeler, counsel for the Maynes. Sam Eig did not attend. Mc-Keever brought over Eig’s check and probably signed a copy of the settlement sheet for him. He stated that his action in bringing over the check was a courtesy to the purchaser.

The brokers did not at any time seek to enforce collection of their commissions out of the deposit which they received in July, 1955. They deposited this check in their trust ac ²⁷⁷ count. McKeever testified that it was the custom of his firm to turn such deposits over to the title company [handling the settlement], that he did not approve of holding the deposit as part of the commission and that he felt it better to have his firm’s commission come from the title company of the sellers. The major and final settlement under the contract was held on April 12, 1956, at the offices of a law firm in Washington, which apparently represented a title company.

A representative of this firm was present at the settlement and produced ’a settlement sheet which showed as one item a commission of $10,000 to Eig & McKeever. Others present at the settlement were Kibbie and McKeever, Mr. Shearin, as counsel for Sam Eig, all three of the Messrs. Mayne and their counsel, Mr. Wheeler. After the settlement sheet was produced, the meeting broke up temporarily in disagreement over the commissions.

The Maynes refused to agree to pay any commissions. Then Mr. Shearin, on behalf of Mr. Sam Eig, demanded that the contract of sale be fulfilled, regardless of any dispute over the commissions. There is some conflict or confusion as to the order of departure of the disputants. The brokers insisted upon their right to commissions and attempted to hand a bill for commissions to the Maynes, but the Maynes denied any obligation to pay commissions, refused to accept the bill, and then walked out of the meeting.

Apparently they returned later, and the settlement was consummated on the same day, with the item for commissions deleted from the settlement sheet. Neither McKeever nor Kibbie was then present. This suit followed several months later. In his instructions to the jury Judge Reeves read to them the following pertinent portion of Code (1951), Art. 2, Sec. 17: “Whenever, in the absence of special agreement to the-contrary, a real estate broker employed to sell, buy, lease or otherwise negotiate real or leasehold estates * * * procures, in good faith a purchaser * * * and the person so procured is accepted as such by the employer, and enters into a valid 1 , binding and enforceable written contract of sale * * * in terms acceptable to the employer, and such contract is ac ²⁷⁸ cepted by the employer and signed by him, the broker shall be deemed to have earned the customary or agreed commission, as the case may be, * * He next instructed them that they should “first consider whether there was any special agreement that no commission was to be paid”, referred to testimony as to the listing of the property with Kibbie for sale at $200,000, net, and to the defendants’ testimony that they had no agreement not to pay a commission, and added that: “It is for you to say whether on all the evidence in this case the listing to sell at two hundred thousand dollars net constituted such an agreement between the plaintiffs and the defendants as would make this an agreement on the part of the plaintiffs to procure a sale of the property without commission.” This was followed by a paragraph dealing with the employment of the brokers by the sellers and their production of a purchaser acceptable to the sellers.

The court continued with this paragraph: “It is also the law that in order to recover a commission a broker must procure a purchaser at the price specified by the seller, unless the owner consents to a sale for a sum other than the price originally agreed upon. The mere fact that there was a listing for two hundred thousand dollars net to the sellers would not deprive the plaintiffs of their right to a commission, if the sellers at any time in the course of their dealings decided to sell to the purchaser produced by the plaintiffs at a price more or less than the two hundred thousand dollars, unless the real estate broker and the sellers agreed that no commission was to be paid. It is further a general rule of law that if the broker introduced the seller and the purchaser and such introduction is the foundation upon which negotiations were begun and the sale effected, he will be entitled to commissions, even though the price ultimately agreed upon by the seller and the purchaser may be lower than the price at which the broker was authorized to sell. In this case there seems to be no doubt but that the seller and the purchaser were brought together by the plaintiffs, and that the purchaser introduced by the plaintiffs did ultimately buy the property.” Next the Judge stated the two principal defenses which we ²⁷⁹ have referred to at the outset of this opinion.

The first of these was that the listing of the property at $200,000 net constituted a special agreement between the brokers and the sellers that there would be no commission payable. He also stated the brokers’ contention on this branch of the case that they had done what they were employed to do and that when the sellers agreed to accept a price of $200,000, they (the brokers) had earned their commission in the absence of a special agreement not to pay a commission. In their brief the appellants set forth a total of fourteen questions under the heading “Questions in Controversy”. Three of them (Nos. 1, 2 and 3) clearly relate to those portions of the instructions to which we have just referred.

Not one of these three is supported by any objection to the charge, such as is required under Rule 554 d of the Maryland Rules. Hence, under Rule 554 e, none of these questions is properly before us. Belt’s Wharf Warehouses, Inc. v. International Products Corp., 213 Md. 585 , 132 A. 2d 588 . We may note in passing that the defendants’ claim that under their agreement with the plaintiffs, no commissions would be payable unless the defendants realized at least $200,000 net was squarely presented to the jury, and that their question No. 3 seems to misconstrue the court’s construction of Sec. 17 of Art. 2 of the Code (1951).

Since these first three questions are not properly before us, it would be useless to review the many cases in this Court, such, for example, as Jones v. Adler, 34 Md. 440 , or Heslop v. Dieudonne, 209 Md. 201 , 120 A. 2d 669 , which have dealt with the right of a real estate broker to