Corvin v. Smead Investment Co.

MARKS, J.

Respondents brought their action against appellants for $2,000 alleged to be due them as a real estate commission on an exchange of appellants’ property effected through their agency. The answer of appellants denied generally the allegations of the complaint. It contained a special defense of fraud on the part of respondents in the execution of an agreement whereby appellants promised to pay them a commission of $2,000, and a further defense of the statute of frauds. The trial court gave judgment in favor of respondents in the sum of $2,000, from which appellants have prosecuted this appeal.

The evidence shows that appellants were copartners doing business under the firm name of the Union Realty Company and as such had a broker’s license issued to them by the real estate commissioner of the state of California for the year 1927. They employed B. C. Adams as a salesman, who was licensed as such by the real estate commissioner.

Some weeks prior to August 23, 1927, Adams contacted C. R. Smead, and was employed by him to effect a sale or exchange of appellants’ property, for which services Smead orally agreed to pay a commission of $2,000. Adams brought Smead and William D. House together in an effort to effect an exchange of their properties. He left on his vacation on August 15, 1927, and turned the consummation of the exchange over to Howard Corvin, one of his employers and one of the respondents. Smead repeated to Corvin his oral promise to pay the $2,000 commission. Corvin succeeded in bringing Smead and House together and effected an exchange of their properties. On August 23, 1927, appellants and House signed a written agreement of exchange, which was prepared by Corvin. Smead signed his own name and that of the Smead Investment Company to this agreement of exchange. Its closing paragraphs are as follows :

“And I further agree to pay the Union Realty Co., Two Thousand and XX/100 Dollars commission for said exchange.

“Dated at Los Angeles, this 23rd day of August, 1927,

“Smead Investment Co.

“C. R. SMEAD.,,

[178]

The actual exchange was consummated and titles to the properties passed about September 23, 1927, and appellants refused to pay any commission to respondents.