Bank of New Mexico v. Freedom Homes, Inc.

612 P.2d 1343, 94 N.M. 532

• Court: New Mexico Court of Appeals
• Decided: May 6, 1980
• Docket: No. 4409
• Status: Published

Opinions

OPINION

WOOD, Chief Judge.

This appeal involves dismissal of a counterclaim. We discuss: (1) a quantum meruit claim of an unlicensed real estate salesperson, and (2) a tort claim for wrongful interference with contractual relations.

Bank of New Mexico sought judgment against Freedom Homes, Inc. for the unpaid amount of certain promissory notes, foreclosure of mortgages securing the notes, a determination of lien priorities among the various lien claimants, and the immediate appointment of a receiver. Although the order of appointment does not appear in the appellate record, other trial court orders state that a receiver was appointed August 1, 1978.

A second amended complaint filed June 19, 1979 names Anguiano as a defendant on the basis that he claimed a lien against the mortgaged real property. Anguiano’s answer admits he filed a lien claim on August 25, 1978. Issues involving this lien claim are not involved in this appeal.

Anguiano counterclaimed against the receiver and the Bank. The counterclaim against the receiver was dismissed with leave granted to file a separate action against the receiver. The dismissal of the counterclaim against the receiver is not involved in this appeal.

The Bank moved to dismiss the counterclaim against it on the basis that the counterclaim failed to state a claim upon which relief could be granted. This motion was granted; the appeal involves this dismissal. The dismissal being under R.Civ.Proc. 12(b)(6), we accept all well-pleaded facts as true and determine whether Anguiano could be entitled to relief under any state of facts provable under the counterclaim. Runyan v. Jaramillo, 90 N.M. 629, 567 P.2d 478 (1977).

Quantum Meruit Claim of an Unlicensed Real Estate Salesperson

The counterclaim alleges that “during the period prior to December, 1978 and continuing until June, 1979 . . . ANGUI-ANO worked as a real estate salesperson for . . . FREEDOM HOMES, INC.”; that this work was “[pjursuant to contract with FREEDOM HOMES, INC.”; that Anguiano was “to receive compensation for each home sold”; that “[djuring the period of December 21, 1978 through May 15, 1979 ANGUIANO secured buyers for some twenty-eight (28) homes” in one of the subdivisions mortgaged to the Bank by Freedom Homes, Inc.

We do not know whether Anguiano’s contract was, or was not, in writing. Accordingly, we do not consider § 47-1-45, N.M. S.A. 1978.

Section 61-29-1, N.M.S.A. 1978 makes it unlawful for any person to engage in the business of a real estate salesman without a license issued by the New Mexico Real Estate Commission. It is stipulated that Anguiano was unlicensed.

Section 61-29-2(D), N.M.S.A. 1978 provides that the licensing requirements do not apply, in certain situations, to owners of property “or to the regular employees thereof”. Anguiano’s claim is on the basis of a contract with Freedom Homes, Inc. and not as an employee.

Section 61-29-16, N.N.S.A. 1978 states:

No action for the collection of commission or compensation earned by any person as a real estate . . salesman required to be licensed under the provisions of this act shall be maintained in the courts of the state unless such person was a duly licensed broker or salesman at the time the alleged cause of action arose.

Anguiano could not have recovered commission or compensation under his contract with Freedom Homes, Inc. because he was unlicensed. Lakeview Invest., Inc. v. Alamogordo Lake Vil, Inc., 86 N.M. 151, 520 P.2d 1096 (1974); Star Realty Company v. Sellers, 73 N.M. 207, 387 P.2d 319 (1963).

Anguiano does not seek to recover from Freedom Homes, Inc. or under his contract with Freedom Homes, Inc. The counterclaim alleged that Anguiano “expended considerable time, effort, skill and expertise” in obtaining purchasers for the twenty-eight homes; that following commencement of the foreclosure action, the Bank “used the product of . [his] labor by completing the sale of the homes ... to the twenty-eight buyers”; that the Bank has received the benefit of Anguiano’s labor and should be required to pay for this benefit in an amount equal to the reasonable value of Anguiano’s services.

Whether the Bank did receive a benefit has not been determined. The issue is whether Anguiano could be entitled to relief. This depends on whether Anguiano can recover in quantum meruit from the Bank when he could not recover under his contract with Freedom Homes, Inc., because unlicensed.

Although this issue has not been expressly decided in connection with the compensation of a real estate salesperson, it has been decided under the Contractor’s Licensing Act. Kaiser v. Thomson, 55 N.M. 270, 232 P.2d 142 (1951) affirmed the dismissal of a quantum meruit claim by Kaiser, who failed to allege he was a duly licensed contractor; “To give effect to this claim would be to . nullify plain statutory provisions to the contract.” Campbell v. Smith, 68 N.M. 373, 362 P.2d 523 (1961) states: “One who has shown himself to be required to have a contractor’s license cannot recover under quantum meruit in the absence of such license.”

Section 61-29-17(A), N.M.S.A. 1978 declares it a misdemeanor to violate § 61-29-1, supra, which makes it unlawful to engage in the business of a real estate salesman without a license. To recover, Anguiano must rely on his unlicensed activities, made unlawful by § 61-29-17(A), supra. Desmet v. Sublett, 54 N.M. 355, 225 P.2d 141 (1950) states:

[A] person cannot maintain an action if, in order to establish his cause of action, he must rely, in whole or in part, on an illegal or immoral act or transaction to which he is a party, or where he must base his cause of action, in whole or in part, on a violation by himself of the criminal or penal laws.

See Measday v. Sweazea, 78 N.M. 781, 438 P.2d 525, 26 A.L.R.3d 1386 (Ct.App. 1968).

Section 61-29-16, supra, states that no action for the collection of compensation by a real estate salesman required to be licensed shall be maintained in the courts of this state. Anguiano’s claim for the reasonable value of his services was a claim for compensation. Star Realty Company v. Sellers, supra, states: “The Statute . prohibits an action based upon a claimed real estate action except by one licensed as provided by law.”

We hold that Anguiano, an unlicensed real estate salesperson, cannot recover for the reasonable value of his services in connection with the twenty-eight home sales alleged in the counterclaim. This result, under New Mexico statutes and decisions, accords with decisions in other jurisdictions. Wegmann v. Mannino, 253 F.2d 627 (5th Cir. 1958); Dixon v. Rollins, 120 Ga.App. 557, 171 S.E.2d 646 (1969); Bradley v. Banks, 260 So.2d 256 (Fla.App. 1972); Isaquirre v. Echevarria, 96 Idaho 641, 534 P.2d 471 (1975); Wright v. Smith, 105 R.I. 1, 249 A.2d 56 (1969); Hale v. Kreisel, 194 Wis. 271, 215 N.W. 227 (1927).

Wrongful Interference with Contractual Relations

The counterclaim alleges that when Anguiano “sought to enforce and collect on his justly owed realtor’s commissions,” the Bank retaliated by raising the price of the property which Anguiano “was attempting to buy from Defendant, FREEDOM HOMES”; that the Bank refused to complete the contract as agreed to by Freedom Homes, Inc. as a direct result of Anguiano’s “attempt to enforce his legal rights”; that as a result of the Bank’s “retaliatory actions” Anguiano “was unable to purchase the house at the previously agreed upon price and was forced to buy it at a higher price”.

It is undisputed that the property was in receivership and, when sold to Anguiano, the receiver did the selling with court approval. How, then, did the Bank refuse to complete the contract?

In his brief, Anguiano asserts that the Bank “through the receiver, raised the price of a home which he had contracted to buy from” Freedom Homes, Inc. and, thus, interfered with his contract with Freedom Homes, Inc.

Anguiano relies on the following quotation from Wolf v. Perry, 65 N.M. 457, 339 P.2d 679 (1959):

The general rule is that one who, without justification or privilege to do so, induces a third person not to perform a contract with another, is liable to the other for the harm caused thereby. ******

A necessary element of the tort . is a showing that the defendant played an active and substantial part in causing the plaintiff to lose the benefits of his contract. There must be some voluntary conduct on the part of the defendant, some overt act which influences the promisor to breach his contract.

The contract allegedly interfered with was Anguiano’s contract with Freedom Homes, Inc. We examine the various stages of the matter to determine whether there could have been a wrongful interference by the Bank.

First, the Bank filed the foreclosure action and sought appointment of a receiver. There is no claim that the Bank proceeded improperly in seeking appointment of a receiver. The mortgages contain a provision stating that if there should be default in payment of the note secured by the mortgage, Freedom Homes, Inc. “irrevocably consents to the appointment of a Receiver pendente lite”.

Second, the receiver, appointed by the court, took possession of the property described in the mortgages. This property included the lot purchased by Anguiano. After inspecting the property, and being without funds, the receiver sought, and the court granted, permission to borrow money in order to complete sixty-nine dwellings which were “in a state of partial completion”. The court’s order states that the sale of the “completed structures will yield a much larger net return to the estate than their sale in their present condition” and that the dwellings “should be completed as quickly as possible to protect the material and labor in the improvements from deterioration, vandalism and waste.” There is no claim that the receiver, or as Anguiano claims, the Bank acting through the receiver, proceeded improperly in preserving receivership assets and in seeking a greater net return to the receivership estate.

Third, the counterclaim alleges that Anguiano was “attempting to buy” from Freedom Homes, Inc. The contract was executory. Waddell v. Shelton Gasoline Co., 101 W.Va. 468, 133 S.E. 75 (1926) states:

[A] receiver is not bound to adopt or to perform executory contracts of the corporation for whom he is receiver . ....

A receiver is not bound to carry out the executory contracts of the corporation, but he may disregard them.

See United States Trust Co. v. Wabash Western Railway, 150 U.S. 287, 37 L.Ed. 1085, 14 S.Ct. 86 (1893); Fauci v. Mulready, 337 Mass. 532, 150 N.E.2d 286 (1958).

The receiver did not adopt the contract Freedom Homes, Inc. had with Anguiano; this is established by the claim that Anguiano was unable to purchase at the previously agreed upon price.

The record shows that the receiver proposed a plan for the sale of the houses upon being completed. The proposed plan, set forth by the receiver in his first report states:

9. That Receiver has determined the deposit paid by prospective home buyers was deposited in trust accounts and is available to be returned to the prospective home buyer when proper request or claim is made for return of the earnest money deposit.

******

11. That the Receiver proposes that each home buyer be given the first opportunity to buy the improvements at appraised, fair market value as determined independently by a qualified appraiser so that each home buyer is given an alternative either to have returned the earnest money deposit or to purchase the house with credit to be given for the earnest money deposit.

The court approved this proposed plan.

Ultimately, the receiver sold a lot, with completed house, to Anguiano; there is no claim that the lot was other that the lot in Anguiano’s contract with Freedom Homes, Inc.

We understand Anguiano’s interference claim to be that the Bank caused the receiver not to adopt the contract between Anguiano and Freedom Homes, Inc.; that the sale by the receiver to Anguiano, in accordance with the court-approved sale plan, was a retaliatory action which was wrongful; that this retaliatory action was by the Bank, acting through the receiver. We assume, but do not decide, that this claim was a “contract” interference claim. However, see Annot., 9 A.L.R.2d 228 (1950).

Anguiano could not be entitled to relief on this claim; the claim disregards the Bank’s position. The Bank’s second amended complaint alleged an indebtedness to it, under the promissory notes, of a principal sum exceeding two and one-fourth million dollars, mortgages on the property of Freedom Homes, Inc. securing payment of the promissory notes, and default in payment. The Bank, no different than other lien claimants, had a financial interest to protect.

[A] receiver should reject any executory contract . . . the performance of which will be burdensome and deplete the receivership estate. Fauci v. Mulready, supra.

Adoption of Anguiano’s contract with Freedom Homes, Inc. would have resulted in fewer receivership assets because' of its lower price. The receiver sought to increase the assets of the receivership by selling the completed homes at appraised value, giving Anguiano the option of buying at the appraised price or a return of his deposit. The trial court approved this plan, and approved the sale to Anguiano.

If, as Anguiano contends, the Bank was acting through the receiver, any interference by the Bank in getting the receiver to propose, and the trial court to approve, a plan to increase assets of the receivership, was not wrongful even if the Bank’s motive was, in part, retaliatory against Anguiano. The Bank was privileged to interfere to protect its financial interest. Williams v. Ashcraft, 72 N.M. 120, 381 P.2d 55 (1963). There being no claim that the Bank’s purpose was improper in seeking to increase the assets of the receivership, see paragraph second above and Williams v. Ashcraft, supra, Anguiano could not be entitled to relief for this interference.

Fourth, the actual sale to Anguiano by the receiver provides no basis for an interference claim. Anguiano does not claim that this sale was not in accord with the court-approved sale plan or that the price was not the appraised price.

The order dismissing Anguiano’s counterclaim against the Bank is affirmed.

IT IS SO ORDERED.

LOPEZ, J., concurs. SUTIN, J., dissenting.