William N. Nitzberg, Philadelphia, for appellants.
Samuel E. Kratzok, Philadelphia, for appellee.
Before Rhodes, P. J., and Hirt, Reno, Dithrich, Ross, Arnold and Gunther, JJ.
[ 170 Pa. Super. Page 226]
This is an action of assumpsit brought by Benjamin Prager, Jr., a real estate broker, to recover a commission alleged to be due to him under the terms of a contract with the defendants. The cause was tried in the Municipal Court of Philadelphia before a judge sitting without a jury. The court found for the plaintiff and entered judgment against defendants in the sum of $1,021.37, their motions for judgment n. o. v. and for a new trial were dismissed and this appeal followed.
On May 23, 1949, the defendants (husband and wife) 'orally employed' the plaintiff to secure a purchaser for their property, which they held as tenants by entireties, and in connection therewith executed an exclusive agency contract, which was signed by the husband-defendant in the presence of his wife. By the terms of the contract the plaintiff was employed to act as the 'sole and exclusive agent' for the sale of defendants' home at the 'sugested' price of $21,500.00 or upon 'any reduced price or other terms to which [defendants] shall consent'. The sole and exclusive agency was to continue until the defendants gave written notice of termination 'but in no event * * * within less than one month' from May 23, 1949. The defendants agreed that if the property 'shall be sold or exchanged by me, during the terms of the said agency, whether effected by [plaintiff] or by myself or by any other person', a commission of 5% would be paid to the plaintiff. Finally, it was provided that the defendants would pay a commission of 5% to the plaintiff if 'within three months after the termination of the said agency I shall sell it to or exchange it with any person with whom [plaintiff] shall have negotiated during the term of the agency'.
After the execution of the agreement, the plaintiff proceeded to advertise the premises for sale in various newspapers and also placed his sale sign on the property.
[ 170 Pa. Super. Page 227]
The plaintiff's sale sign brought the property to the attention of a Doctor Kabel within the exclusive agency period; and, on June 1, 1949, Dr. Kabel made an offer of $18,000.00 through his own real estate agent, Leonard Cobrin. This offer and a later offer of $18,500.00 were received by the plaintiff and by him communicated to the defendants, who rejected them.
On June 24, 1949, the defendants orally informed the plaintiff of their intention to terminate the sole and exclusive agency and demanded a return of the writing evidencing the agreement. The plaintiff returned the writing to the defendants on June 27, 1949, but informed them -- according to his testimony -- that if 'Dr. Kabel or any other customer of mine buys this property within three months after this date, you are still liable for the commission.' The court below found as a fact that the plaintiff informed the defendants of his rights under the contract at the time he returned it.
On June 28, 1949, the defendants sold their property to Dr. Kabel for $18,750.00 and paid the broker's commission on the sale to Cobrin, the agent who had relayed the purchaser's original offers to the plaintiff.
The defendants' principal contention is that when the plaintiff returned to them the exclusive agency contract he thereby relinquished any right he might have to a commission, basing this contention upon section 432 of the Restatement of Contracts which provides, inter alia: '(1) A contractual duty that arises under a formal unilateral contract is discharged * * * (b) by its surrender to the party subject to the duty or to someone on his behalf, by the party having the right, with the intent to discharge the duty * * *.' Comment on subsection (1), so far as herein pertinent, is as follows: ...