Grant v. Marinell

Opinion

KAUS, P. J.

Plaintiff appeals from an order dismissing his action after a demurrer to his first amended complaint was sustained without leave to amend. He contends that the trial court erred in holding that his complaint for breach of an oral contract was barred by the statute of frauds.

The facts alleged are these: In July, 1975, plaintiff entered into an oral agreement with defendant, a licensed real estate broker, under the terms of which plaintiff was to introduce defendant to parties interested in securing the services of a real estate broker. It was agreed that if defendant’s employment as a broker should result from any such introductions, defendant would pay plaintiff, as a finder’s fee, 10 percent of

[619]

any income defendant received. Plaintiff introduced defendant to two . prospects and claimed that the introductions resulted in income to defendant totaling $63,800. When defendant refused to pay the promised finder’s fee, plaintiff sued to enforce the alleged oral agreement. Defendant demurred on the ground that plaintiff’s complaint was barred by the statute of frauds (Civ. Code, § 1624, subd. 5.)

1

After affording plaintiff a chance to redraft his complaint, the trial court sustained defendant’s demurrer without leave to amend.

On this appeal plaintiff contends that Civil Code section 1624 subdivision 5 does not apply to a simple finder’s fee agreement such as was alleged in this case. Plaintiff asserts that the section only covers oral contracts for services within the ambit of a licensed real estate broker’s regular duties. As plaintiff points out, one need not be a licensed real estate broker to act as a finder. (See

Tyrone

v.

Kelly

(1973) 9 Cal. 3d 1, 8 [106 Cal.Rptr. 761, 507 P.2d 65].)

We agree with plaintiff that the judgment must be reversed, but base our decision on reasoning slightly different than his: we have concluded that the agreement as alleged did not fall within the purview of Civil Code section 1624, subdivision 5, because no principal, that is to say, no seller or buyer of real estate, was a party thereto.