Central Realty Co. v. Union Bank & Trust Co.

DORAN, J. This is an appeal by real estate brokers from that portion of an "Order Confirming Sale of Real Property” fixing brokers’ commissions on a sale price of $780,000. The total commission allowed was $10,000, of which appellant’s share was $5,000.

“Appellants contend that the Court failed to perform its judicial function to determine ‘a reasonable compensation’ as required by Probate Code, Section 761.5, and that Finding of Fact XIII (Clk. Tr. p. 23 that the brokers are estopped to demand a commission beyond that announced and fixed by the Court) is not supported by the evidence.”

Section 761.5 of the Probate Code provides that, “Where an original bid is made by a purchaser direct to the estate and thereafter at the time of hearing the return of sale containing the original bid, an increased bid is made by a bona [223]fide agent which results in the confirmation and sale of the property at such increased bid, the court shall allow a commission to the agent who procured the increased bid, which commission shall be fixed by the court at such amount as the court, in its discretion, finds will be a reasonable compensation for the services of the agent to the estate.”

As summarized in appellants’ and respondents’ brief, one of the executors in the Uniaek estate wrote to appellants describing “the Geraldine Tract,” involved herein, listing it for sale and requesting bids, “Subject to the foregoing conditions and to the requirement that the purchaser shall deposit approximately 10 per cent of the purchase price with the offer to purchase, commission will be paid at the regular and current Los Angeles Realty Board rate only to real estate broker submitting written offer accepted by us.” The current commission rate is 5 per cent.

“Appellants, licensed real estate brokers with thirty years experience, thereupon endeavored to interest one L. K. Shapiro in the property. Shapiro apparently was acting for the Western Harness Racing Association. From June 4 to September 23, 1954, . . . most of Mr. Rosenthal’s (one of two partners in Central Realty Co.) time was devoted to the Geraldine Tract and adjacent properties. . . . Mr. Rosenthal did not submit a written bid during this period but he was looking to executor for his commission.”

About September 13, 1954, Mr. Rosenthal telephoned the executor and was advised that an acceptable bid had been received from one Teague. On September 23, 1954, the executors notified Rosenthal that the return of sale on the Teague bid would be heard in court on October 7, 1954. During this period Rosenthal advised the executors “that he would produce a buyer in court,” and was informed that such purchaser should be equipped with cashier’s check and a letter of credit. The Teague bid was $430,000, with a commission of $10,750 claimed, and it is appellant’s claim that this reduced commission arrangement “was unknown to him until the commencement of the hearing.”