Bard v. Kent

California Court of Appeal Feb 5, 1940 No. Civ. 12394Published

Before: Moore

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Holding. The court held that an executed oral agreement between a principal and agent, which modified the terms of their prior written contract, was valid and binding, thereby precluding the plaintiff's claims of fraud and breach of fiduciary duty. The court further held that the statute of limitations and estoppel barred the plaintiff's recovery.

Issues

Whether an executed oral agreement can modify a prior written contract regarding agent commissions and property transfers.
Whether the parol evidence rule bars evidence of an executed oral agreement that modifies a written contract.
Whether the presumption of fraud in a fiduciary relationship is rebutted by evidence of a fully executed agreement with the principal's knowledge.

Disposition. affirmed

Quotations verified verbatim against the opinion

“Any contract in writing may be altered by an executed oral agreement.”

“The parol evidence rule has no application where the matters, with reference to which the writing made provision, have been disposed of by an executed oral agreement.”

“The presumption of fraud urged as a basis for the $11,000 damages wholly failed in the face of satisfactory evidence to the contrary.”

MOORE, P. J.

Ruth Roland married the defendant herein in 1917 and divorced him in 1919. Notwithstanding said incident, the defendant was actively engaged as her agent from 1911 until her decease in 1937.

Decedent was the owner of a large tract of land which, by virtue of her conveyance and indenture in 1924, constituted the

corpus

of a subdivision trust. Simultaneous with the creation of said trust, decedent employed defendant as her agent to sell the said tract and to act as her attorney in fact in all matters pertaining to said trust. As compensation, she agreed to pay defendant a commission of ten per cent of the selling price of the parcels of the subdivision, payable out of the initial payments on the purchase prices of the lots as sold, which were to be no less than twenty per cent of the list prices as set forth in said contract of employment. In addition to said commission, for acting as decedent’s attorney in fact, defendant was to receive, an additional compensation of two and one-half per cent of the selling prices. The enterprise was evidently a success for the lots were all sold to other parties except those hereinafter mentioned. Upon the qualification of the plaintiff as special administrator of the estate of said decedent, he discovered that in 1925 lots 3 and 4 of said tract had been sold to a Mrs. Sheppard but that the contracts of sale had been immediately assigned to the defendant.

Upon the hypothesis that defendant was acting at all times in a fiduciary relation to decedent in the sales and disposition of said land, from his employment until 1929, and that he had concealed the facts from decedent, plaintiff instituted this action and alleged two causes, in substance as follows: (1) That, without disclosing the facts to decedent, the defendant notified the trustee that there was due him a commission of $20,984.38 for the sale of lots A, B and C, and that said trustee should apply $17,080 of said sum to the purchase price of said lots 3 and 4, and to credit his account with the balance ; that the said trustee followed the instructions of defendant, credited him with $20,984.38, conveyed to him said lots 3 and 4, and charged his account with the said $17,080, leaving to his credit the balance; that in truth defendant was entitled to no commission upon said lots A, B and O; (2) his second cause of action was that the said $17,080 applied to

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Bard v. Kent

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MOORE, P. J.

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