Lubeck's Investment Co. v. Voris

California Court of Appeal Sep 17, 1924 No. Civ. No. 4701.Published

Before: Tyler

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Holding. The court held that because the seller and buyer mutually rescinded their contract, the broker was not entitled to withhold any portion of the buyer's deposit as a commission, and the buyer was entitled to the full return of his funds.

Issues

Whether a broker is entitled to retain a commission from a buyer's deposit after the buyer and seller have mutually rescinded the underlying contract.
Whether evidence of a mutual rescission is admissible under a common count for money had and received.

Disposition. reversed

Quotations verified verbatim against the opinion

“The seller and buyer having rescinded their contract by mutual consent, the money in the hands of the plaintiff belonged to the buyer, and plaintiff was entitled to no portion thereof.”

“Plaintiff was the agent of Voris; and whatever right it may have acquired to a commission under the circumstances was one against the seller and not the purchaser, who was no party to the contract providing for a commission.”

TYLER, P. J.

Suit in interpleader.

Plaintiff Lubeck’s Investment Company is a corporation engaged in selling occupational enterprises. It was employed by defendant Voris to find a purchaser for a certain barbershop and cigar-stand owned by him at a net price of $1,250. Plaintiff was to receive as compensation for its services any excels over this sum which it might obtain for the business. In pursuance of this employment plaintiff submitted the proposition of the sale to defendant Faver, who agreed to purchase the same upon certain conditions. This agreement was reduced to writing. Under the terms thereof Voris agreed to sell and Paver agreed to purchase the property for the sum of $1,500. The material portions of the agreement are as follows:

“Lubeck’s Investment Company, Inc.

“San Francisco, Cal., May 16, 1921.

“I, a purchaser, ready, willing and able to perform this agreement, hereby deposit with Lubeck’s Investment Company, a corporation, the sum of $300.00, as part payment of the purchase price of that certain barber shop and cigar stand consisting of all fixtures and stock contained therein, as per inventory to be attached to bill of sale, together with the leasehold interest thereof, located at 252 Leavenworth street in the city and county of San Francisco, California, owned by C. D. Voris, and listed by said owner thereof with Lubeck’s Investment Company as the agent for the sale thereof, and hereby agree to buy said property upon the following terms and conditions, to-wit: the full purchase price of said property to be $1,500.00, the sum of $950.00 cash to be paid on or before May 21st, 1921, and bill of sale subject to mort-

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gage to be executed and delivered by said owner upon the following conditions:

“Balance of $550.00 due on above purchase price the undersigned purchaser agrees to assume the present mortgage on said business amounting to $560.00, payable at the rate of $50.00 per month, with interest at the rate of six per cent per annum.

“It is understood that the undersigned purchaser shall have the right to remain in and around said business until May 21st, 1921, in order to satisfy himself that the monthly net profits are approximately $300.00, and if from the receipts and disbursements the net profits are $300.00 a month the undersigned purchaser agrees to forthwith consummate said sale.

Lubeck's Investment Co. v. Voris

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TYLER, P. J.

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