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JOHN E. BOLAND v. DONALD MULLEN (08/27/82)

filed: August 27, 1982.

JOHN E. BOLAND
v.
DONALD MULLEN, APPELLANT



COUNSEL

Bernadette Barattini, Harrisburg, for appellant.

Jerome T. Foerster, Harrisburg, for appellee.

Brosky, Wieand and Montemuro, JJ.

Author: Wieand

[ 304 Pa. Super. Page 416]

John E. Boland was an unlicensed real estate salesman. Although he had once held a real estate salesman's license, he was not employed by a licensed real estate broker.*fn1

[ 304 Pa. Super. Page 417]

Boland's license, therefore, had been cancelled,*fn2 and he was unauthorized to engage in the business of selling, exchanging, purchasing, or renting of real estate. Donald Mullen was a licensed real estate salesman employed by Pennsylvania Commercial Properties, a licensed broker. In August, 1974, one Val Assotto was attracted by Boland's "Real Estate and Insurance" sign and inquired of Boland concerning the purchase of a warehouse on behalf of a client. Because Boland was not authorized to negotiate a purchase for Assotto, he referred Assotto to Mullen, extracting from Mullen, however, a promise to divide commissions realized as a result of the transaction. After the purchase of a warehouse had been negotiated by Mullen and consummated, Boland commenced an action in assumpsit to recover his portion of the commissions from Mullen and Pennsylvania Commercial Properties. A jury found that Boland was entitled to recover $10,500.00 from Mullen, and the trial court denied a motion for judgment n.o.v. Mullen appealed from the judgment entered on the verdict. His contention is that a contract to divide real estate commissions is illegal and that recovery thereon is barred by the Real Estate Brokers License Act of May 1, 1929, P.L. 1216, 63 P.S. § 431 et seq. We agree.

[ 304 Pa. Super. Page 418]

Section 12(a) of the Real Estate Brokers License Act of May 1, 1929, P.L. 1216, as amended, 63 P.S. § 442(a), as existing in 1974,*fn3 prohibited any person, not licensed under the Act, from engaging in the business or acting in the capacity of a real estate broker or salesman. The Act defined "real estate broker" as "all persons, copartnerships, associations, and corporations, foreign and domestic, who, for another and for a fee, commission, or other valuable consideration, shall sell, exchange, purchase, or rent, or shall negotiate the sale, exchange, purchase or rental, or shall offer or attempt to negotiate the sale, exchange, purchase, or rental . . ." of real estate. Real Estate Brokers License Act, supra, § 2(a), as amended, 63 P.S. § 432(a).

Appellee argues, as he did in the court below, that he did not do an act or perform a service prohibited by the Act, that he did not participate in "buying, selling, exchanging . . . real estate," that he did not negotiate the purchase agreement, and that his claim is for a "finder's fee" which is not prohibited by the statute. A similar argument was made and rejected, albeit under different circumstances, in Alford v. Raschiatore, 163 Pa. Super. 635, 63 A.2d 366 (1949). See also: Verona v. Schenley Farms Co., 312 Pa. 57, 167 A. 317 (1933); Burke v. Israel, 264 Pa. Super. 286, 399 A.2d 779 (1979); Harrison v. Soffer, 221 Pa. Super. 275, 289 A.2d 752 (1972); Annotation, Validity, Construction, and Enforcement of Business Opportunities or "Finder's Fee" Contract, 24 A.L.R.3d 1160 (1969).

Appellee's involvement as a salesman in the instant transaction and the nature of his claim are best illustrated by his own trial testimony. There he testified:

"I told Don Mullen that I have a buyer, that I am an agent representing a buyer who is in turn an agent for Mr. Roland and Roland's firm and they were looking for ...


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