Denise Stroup, as Legal Guardian of D. L. S., an Incapacitated Person v. MRM Management, Inc.

• Court: Court of Appeals of Texas
• Decided: January 2, 2018
• Docket: 03-17-00534-CV
• Status: Published

Opinion

ACCEPTED 03-17-00534-CV 21540047 THIRD COURT OF APPEALS AUSTIN, TEXAS 1/1/2018 3:21 PM JEFFREY D. KYLE CLERK NO. 03-17-00534-CV

FILED IN 3rd COURT OF APPEALS IN THE COURT OF APPEALS AUSTIN, TEXAS FOR THE THIRD DISTRICT OF TEXAS 1/2/2018 8:00:00 AM AUSTIN, TEXAS JEFFREY D. KYLE Clerk

DENISE STROUP, AS LEGAL GUARDIAN OF D.L.S., AN INCAPACITATED PERSON Appellant, VS.

MRM MANAGEMENT, INC. Appellee.

On Appeal from the 53RD District Court of Travis County, Texas No. D-1-GN-17-003290 Honorable Karin Crump

BRIEF OF APPELLANT

APPELLANT RESPECTFULLY REQUESTS ORAL ARGUMENT

FOGELMAN & VON FLATERN, LLP Aaron von Flatern State Bar No. 24076892 3101 Bee Cave Road, Suite 270 Austin, Texas 78746 (512) 375-3198 (512) 372-3209 (telecopier) aaron@fvlawfirm.com

COUNSEL FOR APPELLANT LIST OF PARTIES AND COUNSEL

Pursuant to Rule 38.2(a)(1)(A), the following is a list of parties and counsel before the Court.

Appellant:

Sarah Denise Stroup as legal guardian of D.L.S., an incapacitated person.………………………………….…………………………….Plaintiff

Counsel for Appellant:

Aaron von Flatern........................................................Trial/Appellate Counsel State Bar No. 24076892 Fogelman & Von Flatern, LLP 3101 Bee Cave Road, Suite 100 Austin, Texas 78746 (512) 375-3198 (512) 372-3209 (telecopier) aaron@fvlawfirm.com

Appellee:

MRM Management, Inc..………………………………………......Defendant

Counsel for Appellee:

Gregory R. Ave....................................................................Appellate Counsel State Bar No. 01448900 Walters, Balido & Crain, LLP Meadow Park Tower, Suite 1500 10440 North Central Expressway Dallas, Texas 75231 (214) 347-8310 (214) 347-8311 (telecopier) AveEdocsNotifications@wbclawfirm.com

i TABLE OF CONTENTS

LIST OF PARTIES AND COUNSEL.............................................................i

TABLE OF CONTENTS................................................................................ii

INDEX OF AUTHORITIES...........................................................................v

STATEMENT OF THE CASE.......................................................................1

ISSUES PRESENTED....................................................................................4

STATEMENT OF THE FACTS.....................................................................4

SUMMARY OF THE ARGUMENT..............................................................6

ARGUMENT..................................................................................................8

A. Standard of Review....................................................................8

1. Traditional Motion for Summary Judgment Review.........8

2. No Evidence Motion for Summary Judgment Review......9

3. Summary Judgment Review in General..........................10

B. The Trial Court Erred in Granting MRM’s Traditional Motion for Summary Judgment.............................................................11

1. Appellee MRM Has Failed to Conclusively Negate Respondeat Superior Liability........................................11

a. The independent contractor agreement cannot override the broker’s responsibility under Texas law........................................................................12

ii b. Because it dissuaded Taylor from purchasing additional insurance, MRM should be estopped from using the independent contractor agreement to escape exposure that Taylor would otherwise have insured………………………………..................15

c. Fact questions abound in the determination of the independent-contractor question................................................................17

i. The independent nature of Taylor’s business ……………………………………………18

ii. Taylor’s obligation to supply necessary supplies, tools, and materials……………..19

iii. Taylor’s right to control the progress of her work...........................................................20

iv. The actual control exercised by Appellee MRM..........................................................21

v. The permanency of the working relationship ……………………………………..……..23

vi. Whether the parties believe they are creating an employer-employee relationship...........23

vii. The time for which Taylor was employed...24

viii. The method by which Taylor was paid......24

2. Appellee MRM Has Failed to Conclusively Negate Joint- Enterprise Liability.........................................................24

3. Appellee MRM Has Failed to Conclusively Negate Liability Under the Texas Occupations Code ................28

iii 4. Texas Labor Code Jurisprudence Is Persuasive In Favor of ‘Course and Scope’ Versus ‘Detour’ for Each of Appellant’s Theories of Recovery...................................35

a. The dual purpose rule............................................35

b. The continuous coverage doctrine........................36

C. The Trial Court Erred in Granting MRM’s No Evidence Motion for Summary Judgment.............................................................38

PRAYER..................................................................................................................39

CERTIFICATE OF SERVICE................................................................................40

CERTIFICATE OF COMPLIANCE.......................................................................41

iv INDEX OF AUTHORITIES

Cases

Aetna Cas. & Sur. Co. v. Orgon, 721 S.W.2d 572 (Tex. App.—Austin 1986, writ ref'd n.r.e.)………........................37

Aluminum Chemicals, Inc. v. Bechtel Corp., 28 S.W.3d 64 (Tex. App.—2000, no pet.)…………................................................25

Arbelaez v. Just Brakes Corp., 149 S.W.3d 717 (Tex. App.–Austin 2004, no pet.).............................................37, 38

City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005)....................................................................................10

Denson v. Dallas County Credit Union, 262 S.W.3d 846 (Tex. App.—Dallas 2008, no pet.)……….......................................9

Flood v. Katz, 294 S.W.3d 756 (Tex. App.—Dallas 2009, pet. denied) ...........................................9

Gipson v. Davis Realty Co., 215 Cal. App. 2d 190 (1963)...............................................................................14, 30

Home Interiors & Gifts, Inc. v. Veliz, 695 S.W.2d 35 (Tex. App.—Corpus Christi 1985, writ ref. n.r.e.)...........................18

Kindred v. Con/Chem, Inc., 650 S.W.2d 61 (Tex. 1983)......................................................................................10

King Ranch, Inc. v. Chapman, 118 S.W.3d 742 (Tex. 2003)......................................................................................9

Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706 (Tex. 1997) ……..............................................................................9

v Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546 (Tex. 1985).................................................................................8, 10

Pitchfork Land and Cattle Co. v. King, 346 S.W.2d 598 (Tex. 1961)...............................................................................11, 18

Saenz. v. Southern Union Gas Co., 999 S.W.2d 490 (Tex. App.—El Paso 1999, no pet.)...............................................10

Shelton v. Standard Ins. Co., 389 S.W.2d 290 (Tex. 1965)....................................................................................37

Sudan v. Sudan, 199 S.W.3d 291 (Tex. 2006)....................................................................................10

Texas DOT v. Able, 35 S.W.3d 608 (Tex. 2000)......................................................................................25

Tex. Mut. Ins. Co. v. Jerrols, 385 S.W.3d 619 (Tex. App.—Houston [14th Dist.] 2012, pet. dism'd)..............35, 36

Triton Oil & Gas Corp. v. Marine Contractors & Supply, Inc., 644 S.W.2d 443 (Tex. 1982)…..................................................................................9

Wornick Co. v. Casas, 856 S.W.2d 732 (Tex. 1993)......................................................................................8

Zurich Am. Ins. Co. v. McVey, 339 S.W.3d 724 (Tex. App.—Austin 2011, pet. denied)....................................35, 36

Statutes

Tex. Occ. Code § 1101.001...........................................................................12, 28, 29

Tex. Occ. Code § 1101.002…...........................................................12, 13, 29, 31, 34

Tex. Occ. Code § 1101.351..........................................................................12, 13, 18, 29

vi Tex. Occ. Code § 1101.803....................................................................12, 14, 17, 29, 30

Rules

Tex. R. Civ. P. 166a(i) .........................................................................................9, 10

vii NO. 03-17-00534-CV

IN THE COURT OF APPEALS FOR THE THIRD DISTRICT OF TEXAS AUSTIN, TEXAS

DENISE STROUP, AS LEGAL GUARDIAN OF D.L.S., AN INCAPACITATED PERSON Appellant, VS.

On Appeal from the 53RD District Court of Travis County, Texas No. D-1-GN-17-003290 Honorable Karin Crump

TO THE HONORABLE JUSTICES OF THE COURT OF APPEALS:

Appellant Denise Stroup respectfully presents this Brief of Appellant.

Appellant requests that this Court reverse the judgment of the 53rd District Court of

Travis County, Texas, and in support thereof would show the Court as follows:

STATEMENT OF THE CASE

This is an appeal from summary judgment in a personal injury car-crash case.

It should be noted that the sole injured party in the case—Douglas Lee Stroup a/k/a

1 D.L.S—became incapacitated as a result of his injuries. He was therefore

represented in the proceedings below by his legally appointed guardian, Sarah

Denise Stroup a/k/a Denise Stroup (hereafter “Stroup”, “Appellant”, “Appellant

Stroup”, or “Plaintiff below”). Supp CR 4. On July 27, 2017, by order of the Probate

Court No. 1 of Travis County, Douglas Lee Stroup’s rights were restored, and the

guardianship discharged.

The procedural history is as follows. Appellant Stroup sued a real estate agent

named Penny Harrington Taylor alleging negligent operation of a motor vehicle.

Supp. CR 4-8; Supp. CR 118-124. Stroup additionally sued the corresponding real

estate broker of record, MRM Management, Inc. (the Appellee in this proceeding)

alleging MRM Management, Inc. was vicariously liable for the tortious conduct of

Penny Harrington Taylor. Supp. CR 4-8; Supp. CR 118-124. MRM Management,

Inc. will be referred to herein as “MRM”, “Appellee”, or “Appellee MRM”.

Appellee MRM filed a combined Traditional and No-Evidence Motion for

Summary Judgment. As grounds for summary judgment, Appellee MRM asserted

there was no evidence to support any of Stroup’s theories of vicarious liability,

and/or that the summary judgment evidence conclusively negated Stroup’s theories

of vicarious liability as to MRM.

2 In its motion, Appellee MRM did not challenge Stroup's underlying claims of

negligence as to Defendant Taylor, or assert any grounds with respect to Taylor’s

conduct—only the existence of Defendant MRM’s vicarious liability for Taylor’s

conduct.

The order granting MRM Management, Inc.’s First Amended Traditional and

No Evidence Motions for Summary Judgment was signed on February 28th, 2017

in Travis County Cause No. D-1-GN-15-004909. Supp. CR 407. That case was

styled Sarah Denise Stroup, as Legal Guardian of Douglas Lee Stroup, an

Incapacitated Person v. Penny Harrington Taylor and MRM Management, Inc. in

the 98th Judicial District Court of Travis County, Texas. Supp. CR 407.

By order of that Court, Stroup’s claims against MRM Management, Inc. were

subsequently severed on July 17, 2017 to a new cause—Cause No. D-1-GN-

17003290, styled Douglas Lee Stroup v. MRM Management, Inc. in the 53rd Judicial

District Court of Travis County, Texas. Supp CR 435-36. Accordingly, on July 17,

2017 the prior order granting Summary Judgment as to defendant MRM

Management, Inc., became final as it disposed of all claims and parties within cause

number D-1-GN-17-003290.

Stroup timely filed notice of appeal on August 10, 2017 in Cause No. D-1-

GN-17-003290. Supp. CR 8-9.

3 ISSUES PRESENTED

The sole issue on appeal in this case is whether the trial court’s order granting

summary judgment in favor of MRM was proper. That is: has Stroup presented

evidence raising a genuine issue of material fact as to each element of Stroup’s

vicarious-liability theories of recovery against MRM, including: respondeat

superior; joint-venture liability; and statutory vicarious liability?

A key sub-issue is whether the Texas Real Estate License Act (within the

Texas Occupations Code) requires real estate brokers to be responsible for the

tortious conduct of real estate agents, regardless of the agents’ status as employees

or independent contractors.

SUMMARY OF THE FACTS

This is a personal injury case arising from a car-versus-motorcycle crash.

According to the police report, on August 6, 2015, in Austin, Texas, Penny

Harrington Taylor (hereafter “Taylor” or “Defendant Taylor”), caused a collision

when she advanced her car into a public roadway from a hotel driveway. Supp. CR

347-348. Defendant Taylor was a licensed realtor at the time and Appellee MRM

was her sponsoring broker for that license. Supp. CR 350. Taylor testified that she

believes she was engaged in selling real estate at the time of the subject crash. Supp.

CR 329 (76:21-24). Taylor had traveled to east Austin that Thursday morning from

4 Lakeway, Texas with the intent of devoting the weekend to performing landscape

improvement work on a residential property that she was listing for sale at 2705

Crest Avenue, in Austin, Texas. Supp. CR 318 (59:3-9); Supp. CR 161 (69:14-21).

The listing agreement for 2705 Crest Avenue designates Taylor as the listing agent,

and Keller Williams Realty (trade name for Appellee MRM Management, Inc.) as

the broker of record. See Appendix Ch. 1; see also Supp. CR 352-360; see also Supp.

CR 267 (establishing Keller Williams Realty as the trade name for MRM

Management, Inc.).

In the proceeding below, Appellant Stroup sued Penny Harrington Taylor

(hereafter “Defendant Taylor”) for negligently causing the motor vehicle crash.

Supp. CR 4-8; Supp. CR 118-124. Because Stroup alleged Defendant Taylor was a

licensed real estate salesperson engaged in real estate sales activities at the time of

the crash, Stroup additionally sued the real estate broker of record, Appellee MRM,

alleging that MRM was vicariously liable for Defendant Taylor’s tortious conduct.

Supp CR 4-8; Supp. CR 118-124. Stroup alleged that MRM was vicariously liable

pursuant to one or more of the following theories: respondeat superior; principle-

agent liability; joint enterprise liability; and statutory vicarious liability pursuant to

the Texas Real Estate License Act within the Texas Occupations Code. Supp. CR

118-124.

5 Appellee MRM’s Traditional and No-evidence Motion for Summary

Judgment asserted there was no evidence to support any of Stroup’s theories of

vicarious liability, and/or that its summary judgment evidence conclusively negated

Stroup’s theories of vicarious liability as to MRM.

SUMMARY OF THE ARGUMENT

The Trial Court erred in granting MRM Management, Inc.’s Traditional

Motion for Summary Judgment. Appellee has failed to conclusively negate

respondeat superior liability for Appellant's tort claims against Appellee’s employee

Penny Taylor. Appellee argues Taylor was an independent contractor to whom

respondeat superior could not apply. However, because Taylor was a real estate

agent, and Appellee was Taylor's real estate broker of record, the independent

contractor agreement presented by Appellee cannot override Texas law requiring

MRM to be responsible for Defendant Taylor's conduct. Further, because the

wording of the agreement dissuaded Taylor from purchasing additional insurance,

MRM should be estopped from using the independent contractor agreement to

escape exposure that Taylor would otherwise have insured. Further, fact questions

abound in this case when weighing the independent-contractor-versus-employee

factors established by the Texas Supreme Court. Factors with fact questions include:

the independent nature of Taylor’s business; Taylor’s obligation to supply necessary

6 supplies, tools, and materials; Taylor’s right to control the progress of her work; the

actual control exercised by Appellee MRM; the permanency of the working

relationship; whether the parties believe they created an employer-employee

relationship; the time for which Taylor was employed; and the method by which

Taylor was paid.

In addition to respondeat superior liability, Appellee MRM has failed to

conclusively negate joint-enterprise liability. Appellee argues there was no evidence

of the element of equal right of control, and that Taylor was outside the scope of any

alleged joint-enterprise. However, substantial evidence suggests MRM’s real estate

agents participated in the governance of the organization, and that Taylor was within

the scope of her work for the organization when the crash occurred. The course-and-

scope evidence applies not only to the joint-enterprise theory of recovery, but also

to the respondeat superior theory of recovery, and the statutory vicarious liability

theory of recovery.

Appellee MRM has failed to conclusively negate vicarious liability under the

Texas Occupations Code, which requires real estate brokers to answer for the

tortious conduct of the real estate agents who carry out the broker’s business.

Finally, the trial court erred in granting MRM’s no-evidence motion for

summary judgment. Because MRM has only challenged its vicarious liability for

7 Taylor's conduct, and not the elements of Plaintiff's tort claims against Taylor, the

fact issues established in response to Appelle's Traditional Motion are equally

responsive to the no-evidence motion. Appellant has presented more than a scintilla

of evidence as to Appellee MRM's right of control as an employer, vicarious liability

as a joint-venturer, and statutory responsibility as a sponsoring broker. Further,

Appellant has presented more than a scintilla of evidence as to Taylor's acting within

the course and scope of the relevant work under the doctrines of respondeat superior,

joint-enterprise, and statutory vicarious liability.

ARGUMENT

A. Standard of Review

1. Traditional Motion for Summary Judgment Review

The standard for reviewing a traditional summary judgment is well

established. Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546, 548-49 (Tex. 1985).

Defendants who move for traditional summary judgment must show the plaintiff has

no cause of action. See Id. Defendant (here, the Appellee MRM) may meet this

burden by either disproving at least one essential element of each theory of recovery,

or by conclusively proving all elements of an affirmative defense. Wornick Co. v.

Casas, 856 S.W.2d 732, 733 (Tex. 1993).

A matter is conclusively established if ordinary minds cannot differ as to the

8 conclusion to be drawn from the evidence. Triton Oil & Gas Corp. v. Marine

Contractors & Supply, Inc., 644 S.W.2d 443, 446 (Tex. 1982). After the movants

have established a right to summary judgment, the burden shifts to the nonmovants

to present evidence creating a fact issue. Denson v. Dallas County Credit Union, 262

S.W.3d 846, 849 (Tex. App.--Dallas 2008, no pet.).

2. No Evidence Summary Judgment Review

The standard for reviewing a no-evidence summary judgment is the same

legal sufficiency standard used to review a directed verdict. See Tex. R. Civ. P.

166a(i); Flood v. Katz, 294 S.W.3d 756, 762 (Tex. App.—Dallas 2009, pet. denied).

Accordingly, this Court must determine whether the nonmovant—here, the

Appellant--produced more than a scintilla of probative evidence to raise a fact issue

on the material questions presented. See Flood, 294 S.W.3d at 762.

A no-evidence summary judgment is improperly granted if the respondent—

here, the Appellant—has brought forth more than a scintilla of probative evidence

to raise a genuine issue of material fact. King Ranch, Inc. v. Chapman, 118 S.W.3d

742, 751 (Tex. 2003). "More than a scintilla of evidence exists when the evidence

rises to a level that would enable reasonable, fair-minded persons to differ in their

conclusions." Id. (quoting Merrell Dow Pharms., Inc. v. Havner, 953 S.W.2d 706,

711 (Tex. 1997)). "Less than a scintilla of evidence exists when the evidence is 'so

9 weak as to do no more than create a mere surmise or suspicion' of a fact." Id.

(quoting Kindred v. Con/Chem, Inc., 650 S.W.2d 61, 63 (Tex. 1983)).

Appellant–as non-movant responding to a no-evidence motion for summary

judgment–is not required to have marshalled her proof, but need only have pointed

out evidence that raises a fact question on the challenged elements. See Saenz. v.

Southern Union Gas Co., 999 S.W.2d 490, 493-94 (Tex. App.–El Paso 1999, no

pet.); see also Comments to Tex. R. Civ. P. 166a(i).

3. Summary Judgment review in general

In deciding or reviewing either a traditional or no-evidence motion for

summary judgment, every reasonable inference must be indulged in favor of the

non-movant, and any doubts resolved in the non-movant’s favor. See Nixon v. Mr.

Property Management Co., 690 S.W.2d 546, 548 (Tex. 1985); Sudan v. Sudan, 199

S.W.3d 291, 292 (Tex. 2006) (quoting City of Keller v. Wilson, 168 S.W.3d 802, 823

(Tex. 2005)).

Thus, the Appellant should prevail in this case on both the traditional motion

for summary judgment and the no-evidence motion for summary judgment if the

summary judgment evidence contains more than a scintilla of evidence to raise a

genuine issue of material fact for each of the challenged theories of recovery.

10 B. The Trial Court Erred in Granting MJM’s Traditional Motion for Summary Judgment

Appellee MRM’s summary judgment evidence failed to conclusively negate

vicarious liability under any of the Appellant Stroup’s theories of recovery,

including respondeat superior, joint enterprise, and statutory liability. The summary

judgement evidence raised, at a minimum, a genuine issue of material fact as to each

theory. Therefore, the trial court erred in granting Appellee MRM’s traditional

motion for summary judgment.

1. Appellee MRM has failed to conclusively negate respondeat superior liability

Appellee MRM’s Traditional Motion for Summary Judgment argued that the

summary judgment evidence conclusively established that Defendant Taylor was an

independent contractor, and thus not MRM’s employee. Supp. CR 206-207. In

support of this proposition, Appellee MRM points to an independent contractor

agreement that Taylor signed, and further argued that the Court should apply a multi-

factored test pursuant to, inter alia, Pitchfork Land & Cattle v. King. Supp. CR 206;

See Pitchfork Land and Cattle Co. v. King, 346 S.W.2d 598, 602-03 (Tex. 1961);

see also Appendix Ch. 2 (independent contractor agreement).

Plaintiff would show that the independent contractor agreement is void to the

extent it conflicts with the Texas Occupation Code’s statutory mandate that real

11 estate brokers answer for their salespersons’ tortious conduct.

Additionally, Plaintiff will show that Defendant MRM should be estopped

from using the independent contractor agreement to shield itself from liability that

the agreement itself places at the feet of Defendant MRM.

Finally, even assuming the multifactored Pitchfork test were the only

consideration for the question of respondeat superior liability, the summary

judgment evidence presents genuine issues of material fact within the application of

that test.

a. The independent contractor agreement cannot override the broker’s responsibility under Texas law

MRM’s main argument against respondeat superior liability is the

independent contractor agreement that Defendant Taylor signed. However, the

independent contractor agreement is void to the extent it conflicts with the Texas

Occupation Code’s statutory mandate that real estate brokers answer for their

salespersons’ tortious conduct.

Chapter 1101 of the Texas Occupations Code is known as the Texas Real

Estate License Act (hereafter “the Act”). See Tex. Occ. Code § 1101 et seq.; See also

Appendix Ch. 3. The Act sets forth the authority, professional standards, and

licensure requirements for persons and entities engaged in real estate transactions in

12 Texas, including real estate “brokers” and “salespersons”. Id.1 In general terms, the

Act defines “brokers” as persons who are paid to perform certain acts (referred to

herein as “broker acts”) for others. See Tex. Occ. Code § 1101.002(1). Those broker

acts are presented within a statutory laundry list that covers virtually all of the things

the general public would commonly understand to be the job of a “realtor” including:

buying and selling real estate; listing real estate; locating real estate; procuring

prospects to accomplish the sale of real estate; and promoting the sale of real estate.

Id.

The Act defines a “salesperson” as a person who is sponsored by a licensed

broker for the purpose of performing the above [broker] acts. See Tex. Occ. Code §

1101.002(7). Further, the Act states that “[a] licensed salesperson may not engage

or attempt to engage in real estate brokerage unless the sales agent is sponsored by

a licensed broker and is acting for that broker. Tex. Occ. Code § 1101.351(c)

(emphasis added).

In other words, all aspects of all real estate transactions in Texas are

technically carried out by real estate brokers, or by salespersons who are authorized

to engage in real estate brokerage for their sponsoring broker on the brokers’

1 The Occupations Code was revised effective January 1, 2016 (after the subject crash). Under the revision, the term “salesperson” was changed to “sales agent”. The code provisions cited herein were otherwise unchanged.

13 behalves. As such, the Act establishes a master-servant relationship as a matter of

law, and assigns legal responsibility for all statutory broker acts to the brokers.

Section 1101.803 of the Act states “[a] licensed broker is liable to the commission,

the public, and the broker's clients for any conduct engaged in under this chapter by

the broker or by a salesperson associated with or acting for the broker. Tex. Occ.

Code § 1101.803 (emphasis added).

The Act contains no provision authorizing brokers to contractually assign that

responsibility back to the salespersons, and thus brokers like Defendant MRM have

a non-delegable duty to the public for the conduct of salespersons associated with

Defendant MRM.

Therefore, any agreement that purports to characterize a salesperson’s

relationship to her sponsoring broker as that of an independent contractor is simply

void and unenforceable for the purposes of vicarious liability. Although Plaintiff

could locate no cases in which such a contract has been deemed void in Texas,

Plaintiff would point the court to persuasive authority in California, where a similar

statute was construed to void a realtor’s independent contractor agreement with his

sponsoring broker. See Gipson v. Davis Realty Co., 215 Cal. App. 2d 190 (1963);

See Appendix Ch. 3.

14 Because Defendant MRM’s traditional motion for summary judgment relative

to the theory of respondeat superior is entirely predicated on the argument that

Defendant Taylor should be characterized as an independent contractor, and because

that characterization is statutorily prohibited, Defendant MRM’s motion should be

denied.

b. Because it dissuaded Taylor from purchasing additional insurance, MRM should be estopped from using the independent contractor agreement to escape exposure that Taylor would otherwise have insured

Even if the independent contractor agreement cited by Appellee MRM were

deemed enforceable, the agreement on its face implies that MRM will accept a large

share of liability for Defendant Taylor’s conduct. Supp. CR 267-273; See Appendix

Ch. 4. Because the misleading document dissuaded Defendant Taylor from

purchasing additional insurance, or from investigating the need for same, MRM

should be estopped from using the independent contractor agreement to shield itself

from the exposure presented by Appellant’s claims. Id.

Section D within page 4 of the subject agreement states that “for

risks…arising from Agent’s negligent…breach of any law, regulation, or standard

of conduct that applies to Agent’s actions or activities as a licensed real estate sales

associate, Agent agrees to indemnify and hold [Appelle MRM] harmless from and

15 against that percentage of Liability that equals the percentage of commissions

payable to the Agent on the date of the incident or omission that gave rise to the

Liability occurred.” Id (emphasis added). Section B goes on within that same page

to define “Liability” to mean “all liability, claims, damages, losses, costs and

expenses that a party sustains or incurs as a result of or in connection with a

particular incident or situation”. Id. Thus, for “[all] damages”, “[all] claims”, and

“[all] losses that a party sustains” MRM only requires its agents to indemnify MRM

or hold MRM harmless from a (capped) portion of MRM’s liability. See Id.

This reads like a co-insurance requirement. One can imagine Dominos Pizza

telling its delivery drivers: “If you cause a crash, you must forfeit a portion of your

delivery tip to cover Dominos’ exposure”. Most delivery drivers would take that to

mean Dominoes was assuming responsibility for the rest of the exposure, or that

Dominos anticipated it would be vicariously liable for the driver’s conduct. The

same applies here, especially when viewed within the totality of the circumstances

of MRM’s sponsorship of Taylor’s license, including:

(1) MRM’s requirement that Taylor insure her car to a certain level, and to

have (MRM’s trade name) Keller Williams named as an additional

insured; CR 375 (59:4-8); and

16 (2) the express vicarious liability requirement stated in the Texas Real

Estate License Act through which Taylor obtained her license. See Tex.

Occ. Code § 1101.803 (stating “[a] licensed broker is liable to… the

public… for any conduct engaged in under this chapter by… a

salesperson associated with or acting for the broker).

The clear implication of this agreement is that MRM anticipated its own

liability for losses arising from the agent’s negligence, and viewed that risk as a

routine part of its business. It only asked the agent to cover a portion of the MRM

exposure. Under the agreement, the agent’s percentage of responsibility for “all

claims” against MRM could never exceed the commission that she earned on the day

of the subject negligence. See Supp. CR 267-273; see Appendix Ch. 4.

To the extent Defendant Taylor was consciously or subconsciously mislead

by this agreement, and otherwise might have secured additional liability insurance

for herself, Defendant MRM should be estopped from using the agreement to shield

itself from the master-servant liability that the agreement implies is MRM’s.

c. Fact questions abound in the determination of the independent-contractor question

Even if the Court finds the Occupations Code inapplicable, the question of

whether Defendant Taylor was an employee or independent contractor, is a factually

17 intense, multi-factored inquiry. Appellee’s MRM’s evidence fails to conclusively

establish that Defendant Taylor was an independent contractor under the “Pitchfork”

factors urged by MRM. Those factors are: (1) the independent nature of the

contractor’s business; (2) the contractor’s obligation to supply necessary supplies,

tools, and materials; (3) the contractor’s right to control the progress of the work; (4)

the actual control exercised by the employer; (5) the permanency of the work

relationship; (6) whether the parties believe they are creating an employer-employee

relationship; (7) the time for which she is employed; and (8) the method by which

she is paid. See Pitchfork Land and Cattle Co. v. King, 346 S.W.2d 598, 602-03

(Tex. 1961); see also Home Interiors & Gifts, Inc. v. Veliz, 695 S.W.2d 35, 41 (Tex.

App.-Corpus Christi 1985, writ ref. n.r.e.).

Appellant would show the court the following genuine issues of material fact

concerning those same factors:

i. The independent nature of Taylor’s business

Texas law prohibits Defendant Taylor from engaging in any real estate

business without Appellee MRM’s sponsoring brokerage. Further, all of Defendant

Taylor’s real estate related activities would be illegal “unless [she] is sponsored by

a licensed broker and is acting for that broker.” See Tex. Occ. Code § 1101.351(c)

18 (emphasis added); See also above Section B(1)(a) of Appellant’s Brief, describing

the linkage between real estate salespersons and brokers created by the Texas Real

Estate License Act, and fact that virtually all known real estate related activities are

legally the actions of real estate brokers like MRM. Therefore, the nature of

Defendant Taylor’s real estate business is to be completely dependent upon Appellee

MRM’s sponsoring brokerage.

ii. Taylor’s obligation to supply necessary supplies, tools, and materials

Appellee MRM supplied Taylor with a business card (showing Appellee’s

MRM’s trade name Keller Williams, and describing her as a Keller Williams “Real

Estate Agent”). Supp. CR 337. Defendant MRM supplied training, including a

dedicated training agent and training book, software training, a website containing

training materials, videos, forms, calculators, and kits. Supp. CR 306-11 (17:13-

18:12;19:16-19;23:7-24:7). Defendant MRM also supplied software for

electronically managing Taylor’s real estate transactions. Supp. CR 308-09 (19:16-

20:3). Defendant MRM also supplied packets and checklists to realtors like Taylor

to guide them through, e.g., the listing process and open houses. Supp. CR 373-74

(57:8-58:6).

19 iii. Taylor’s right to control the progress of her work

Most employees who are licensed professionals, whether realtors, engineers,

attorneys, or insurance adjusters, are likely to enjoy a high level of autonomy even

while remaining subject to their employer’s right of control. As such, it is no surprise

that Defendant Taylor was empowered to manage her real estate transactions with a

high degree of professional independence. It is telling, however, that Appellee MRM

nonetheless subjected her to a number of policies and procedural requirements, the

violation of which could be considered a “fire-able offense.” Supp. CR 375 (59:4-

10). Many of those policies are contained in the Keller Williams Policies and

Guidelines manual, excerpts from which are attached hereto See Supp. CR 379-93;

Appendix Ch. 5. That document, on page 1-1, starts off with a dramatic, if vague,

definition of “interdependence”, which quotes Stephen Covey to directly refute the

concept of “independence” in favor of the more magical paradigm of

“interdependence”. See Id. That interdependence is evident from the numerous ways

that Defendant MRM exercised control over Taylor including:

• Requiring Taylor to insure her car to a certain level, and to have Keller

Williams named as an additional insured. Defendant Taylor; Supp. CR

375 (59:4-8).

20 • Requiring Taylor to keep her car clean (this one is particularly relevant

in this case as Ms. Taylor was—in addition to conducting other real

estate business—looking for a car wash at the time of the subject crash);

Supp. CR 333 (101:7-24); See also Supp. CR 389 ¶ 1-2; See generally

Supp. CR 267-273 and specifically Supp. CR 267 ¶ 3.

• Creating “standards” that Appellee MRM alleges Taylor violated

including the standard of turning in listing agreements within 3 days of

execution, refraining from performing manual labor on real property,

and refraining from hiring contractors to perform work. Supp. CR 368-

72 (49:22-52:3).

iv. The actual control exercised by Defendant MRM

As partly-described in the preceding section, Defendant MRM exercised

control over its agents by contractually binding them to follow the aforementioned

100-plus page Policies and Guidelines manual. Supp. CR 333 (101:7-24); see

generally Supp. CR 267-273 and specifically CR 267 ¶ 3; see also Appendix Ch. 5.

This was not just a handout, but something the agents had to agree in writing to

follow. Id. Within the manual, control is exerted in the form of, e.g., section

“4.9.1.12 Conduct” which governs alcohol consumption, conduct at the market

21 center, and cooperation with other brokers. Supp. CR 366-67 (16:17-17:2);

Appendix Ch. 5. Likewise, the preceding section of this brief gives examples of

policies within the manual concerning the maintenance of a certain level of

automobile insurance covering MRM, and the need for agents to keep their cars

clean. The manual further instructs Taylor to, e.g., contact her sellers at least once

per week. See Supp. CR 390 ¶ 5 (Section 4.9.1.20.2). Further, in Section 4.9.1.20.3,

the manual instructs Taylor to maintain complete and accurate records, and, in clear

employer-speak, admonishes Taylor in bold letters that “there is no excuse for the

violation of this guideline by any associate”. See Supp. CR 390 ¶ 6 (Section

4.9.1.20.3).

Oddly, that bold admonition uses the watered-down term “guideline” instead

of the stronger, more accurate term “policy.” This is a transparent attempt by

Appellee MRM to enjoy absolute control without having to be responsible for that

control. This theme is repeated in Appellee MRM’s corporate representative Jessica

Tenant’s deposition. Although her lawyers sent requests for admissions to Defendant

Taylor asking Taylor to admit that “Keller Williams associates should not perform

repair work for listed properties”, Ms. Tenant testified that that is “not a demand”,

but rather “a professional standards suggestion.” Supp. CR 369-71 (50:13-52:1);

Supp. CR 395-399. Likewise, when she was asked about her lawyers’ request that

22 Defendant Taylor admit that Taylor was not allowed to hire contractors without

Keller Williams’ [MRM’s] express consent, Ms. Tenant backtracked and said that

there actually is no written policy on that, but that Defendant Taylor should have

talked to [Appellee MRM] about it. Id.

Such vagueness should not benefit the party who created it, especially in the

context of summary judgment.

v. The permanency of the working relationship

Defendant Taylor’s real estate license has been solely sponsored by Appellee

MRM for nearly 10 years. Supp. CR 303-04 (6:7-7:18).

vi. Whether the parties believe they are creating an employer-employee relationship

As pointed out in Appellee’s Motion for Summary Judgment, Defendant

Taylor has stated she believes she was an independent contractor. Supp. CR 211 ¶

1. However, she is also a lay witness. She has no reason to doubt the force and effect

of the independent contractor agreement she was made to sign when she joined

MRM. As above, Appellant Stroup maintains that the agreement is misleading and

void. Moreover, to the extent Taylor’s subjective belief about her employment status

was misinformed by Appellee MRM, her subjective belief should be given little if

any weight.

23 vii. The time for which Taylor was employed

As above, Defendant Taylor’s real estate license has been solely sponsored by

Appellee MRM for nearly 10 years. Supp. CR 303-04 (6:7-7:18).

viii. The method by which Taylor was paid

All of Taylor’s compensation was paid by Appellee MRM (or its dba Keller

Williams). Supp. CR 372 (55:4-55:6).

Putting all of the above factors together, it is clear that genuine issues of

material fact exist as to whether Defendant Taylor was an independent contractor or

an employee. The trial court therefore erred in granting Appellee MRM’s traditional

2. Appellee MRM has failed to conclusively negate joint- enterprise liability

In both its traditional and no evidence motions, Appellee MRM argues there

is no evidence supporting the existence, and no fact questions as to the absence of,

a joint enterprise through which Appellant Stroup could hold Appellee MRM

vicariously liable for Defendant Taylor’s actions. Supp. CR 143-44; 213-14.

Appellant Stroup agrees with the elements as stated in Appellee’s motion, and

that for joint-enterprise liability to attach, Appellant must establish: an agreement; a

common purpose; a community of pecuniary interest; and an equal right of control

24 between Defendant Taylor and Appellee MRM. See Supp. CR 143-144; Texas DOT

v. Able, 35 S.W.3d 608, 613 (Tex. 2000). Appellant also agrees that Appellant must

establish that Taylor was acting within the scope of that joint enterprise to hold

Appellee MRM vicariously liable. Supp CR 143-144; see also Aluminum Chemicals,

Inc. v. Bechtel Corp., 28 S.W.3d 64, 67 (Tex. App.--Texarkana 2000, no pet.)

Appellee MRM has wholly failed to offer evidence conclusively negating any

of those elements within its traditional motion for summary judgment. As such the

traditional motion for summary judgment should be denied on its face.

Within its no-evidence motion, Appellee MRM did not challenge the elements

of agreement, common purpose, or community of pecuniary interest. Instead

MRM’s no-evidence motion has challenged the elements of (1) equal right of

control; and (2) acting in the scope of the joint enterprise. Supp. CR 216-217. As to

equal right of control, there is ample evidence, as described above, that Taylor was

contractually bound to follow MRM’s policies including keeping her car clean, and

that she was doing exactly that leading up to the crash. Appellee MRM, who is

charged by the Texas Occupations Code with responsibility for the salesperson

Taylor’s actions, and who promulgated policies for its agents to follow, clearly had

the ability and right to tell Taylor what to do in connection with buying and listing

real estate. Meanwhile MRM’s corporate representative Jessica Tennant has testified

25 that the agent’s leadership committee was developed so that agents would “…have

a voice in the decision-making and how the office was run…” Supp. CR 371 (52:6-

21).

As for the question of scope, there is ample evidence that in a broad sense,

Taylor had traveled to east Austin from Lakeway Texas with the intent of devoting

the entire weekend of the crash to performing work on the property she was listing

at 2705 Crest Avenue. Supp. CR 318 (59:3-9). Taylor was the listing agent, and

Keller Williams Realty (trade name for Defendant MRM) was listed as the broker

on the listing agreement. Supp. CR 352-360.

The morning of the crash, Defendant Taylor had met with the head

landscaping worker, and had driven with him to Home Depot where she purchased

supplies including a chainsaw and chainsaw oil for use by the landscapers on the

subject house. Supp. CR 319-23 (60:17-61:9:4; 62:24-63:2; 63:19-64:12). The plan

was to clear trees to open up the view in order to improve the marketing of the

property. Supp. CR 322-23 (63:25-64:12). Taylor went to the hotel to check in with

him following the couple’s trip to Home Depot. Supp. CR 326 (70:11-22). Given

that Ms. Taylor testified that she was having an affair with the landscaper, there is a

fact question about whether she would have deviated from her real estate activities

at some point for romantic activities before returning to the enterprise of marketing

26 2705 Crest Ave. However, this red-hearing question would exist with any couple

who happened to work together. There is absolutely no evidence that the couple in

this case did anything but work on the day of the crash.

The summary judgment evidence shows that Taylor went to Home Depot,

returned to check in at the hotel with the landscaper (in anticipation of a multiple-

day job), dropped her stuff in the room, and was getting ready to return to the

worksite at 2705 Crest Avenue. At that point she decided to move her car out of the

sun, and in so doing, to peer around for a nearby car wash. Supp. CR 326-28 (70:23-

72:3). Importantly, the logical reason for her to move her car out of the sun at that

moment was that the couple was about to take the landscaper’s truck back to 2705

Crest Ave, leaving her car where it was parked in the August sun. Supp. CR 326

(70:11-71:3). Thus, even if a romantic detour had occurred after the trip to Home

Depot (which is contrary to what Taylor testified to), she was at a minimum re-

engaging with the enterprise of marketing 2705 Crest Avenue, the property for

which she was the contractual listing agent and Appellee MRM was the contractual

broker.

The Defendant’s suggestion that by looking for a car wash, Taylor somehow

deviated from her joint enterprise with MRM—when keeping one’s car clean was

an express directive from MRM—is clearly well short of conclusive. The fact that

27 Taylor didn’t plan to meet potential buyers that day is also irrelevant given that she

agreed in her deposition that the active makeover of the 2705 Crest Ave property

presented opportunities to discuss the impending sale with neighbors, who might

themselves be interested in selling property that Taylor could list, and which

Defendant MRM could make money from. Supp. CR 329-31 (76:21-78:23).

Ultimately, Defendant Taylor testified that she believes she was engaged in the

selling of real estate at the time of the subject crash. Supp. CR 329 (76:21-24).

3. Appellee MRM has failed to conclusively negate liability under the Texas Occupations Code

Above, in Section B(1)(a) of this Brief, the applicability of the Texas

Occupations Code is discussed as a reason for voiding the independent contractor

agreement in this case. That information is repeated here for ease of reference and

in order to expand the argument.

Repeated text:

Chapter 1101 of the Texas Occupations Code is known as the Texas Real

Estate License Act (hereafter “the Act”). See Tex. Occ. Code § 1101.001. The Act

sets forth the authority, professional standards, and licensure requirements for

persons and entities engaged in real estate transactions in Texas, including real estate

“brokers” and “salespersons”. See Tex. Occ. Code. § 1101 et seq. In general terms,

28 the Act defines “brokers” as persons who are paid to perform certain acts (referred

to herein as “broker acts”) for others. See Tex. Occ. Code § 1101.002(1). Those

broker acts are presented within a statutory laundry list that covers virtually all of

the things the general public would commonly understand to be the job of a “realtor”

including: buying and selling real estate; listing real estate; locating real estate;

procuring prospects to accomplish the sale of real estate; and promoting the sale of

real estate. Id. The Act defines a “salesperson” as a person who is sponsored by a

licensed broker for the purpose of performing the above [broker] acts. See Tex. Occ.

Code § 1101.002(7). Further, the Act states that “[a] licensed salesperson may not

engage or attempt to engage in real estate brokerage unless the sales agent is

sponsored by a licensed broker and is acting for that broker. Tex. Occ. Code §

1101.351(c) (emphasis added).

In other words, all aspects of all real estate transactions in Texas are

technically carried out by real estate brokers, or by salespersons who are authorized

to engage in real estate brokerage for their sponsoring broker on the brokers’

behalves. As such, the Act establishes a master-servant relationship as a matter of

law, and assigns legal responsibility for all statutory broker acts to the brokers.

Section 1101.803 of the Act states “[a] licensed broker is liable to the commission,

the public, and the broker's clients for any conduct engaged in under this chapter by

29 the broker or by a salesperson associated with or acting for the broker. Tex. Occ.

The Act contains no provision authorizing brokers to contractually assign that

responsibility back to the salespersons, and thus brokers like Defendant MRM have

a non-delegable duty to the public for the conduct of salespersons associated with

Consequently, any agreement that purports to characterize a salesperson’s

relationship to her sponsoring broker as that of an independent contractor is simply

void and unenforceable for the purposes of vicarious liability. Although Plaintiff

could locate no cases in which such a contract was voided in Texas, Plaintiff would

point the court to persuasive authority in California, where a similar statute was

construed to void a realtor’s independent contractor agreement with his sponsoring

broker. See Gipson v. Davis Realty Co., 215 Cal. App. 2d 190 (1963). See Appendix

Ch. 3.

New text:

In its traditional and no evidence motion for summary judgment, Appellee

MRM asserts that the summary evidence shows Defendant Taylor was not

associated with or acting for Appellee MRM at the time of the subject crash; and

that there is no evidence Taylor was engaged in one of the acts specified in Section

30 1101.002(1) of the Texas Occupations Code. Supp. CR 214 ¶ 2; Supp. CR 217 ¶ 3.

Due to the linkage of the law as described above, if Taylor was performing

one of the acts described in 1101.002(1), then she automatically had to be doing it

for Appellee MRM pursuant to Section 1101.351(c). Thus, answering the question

of whether she was engaged in an act described by Section 1101.002(1) answers the

question of “acting for or associated with.”

Section 1101.002(1) provides the following list of acts that the law deems the

acts of the broker, whether performed by the broker or by a salesperson associated

with the broker, as long as they are performed with the expectation of compensation

for another:

“(A)…. (i) sells, exchanges, purchases, or leases real estate; (ii) offers to sell, exchange, purchase, or lease real estate; (iii) negotiates or attempts to negotiate the listing, sale, exchange, purchase, or lease of real estate; (iv) lists or offers, attempts, or agrees to list real estate for sale, lease, or exchange; (v) auctions or offers, attempts, or agrees to auction real estate; (vi) deals in options on real estate, including a lease to purchase or buying, selling, or offering to buy or sell options on real estate; (vii) aids or offers or attempts to aid in locating or obtaining real estate for purchase or lease; (viii) procures or assists in procuring a prospect to effect the sale, exchange, or lease of real estate; (ix) procures or assists in procuring property to effect the

31 sale, exchange, or lease of real estate; (x) controls the acceptance or deposit of rent from a resident of a single-family residential real property unit; (xi) provides a written analysis, opinion, or conclusion relating to the estimated price of real property if the analysis, opinion, or conclusion: (a) is not referred to as an appraisal; (b) is provided in the ordinary course of the person's business; and (c) is related to the actual or potential management, acquisition, disposition, or encumbrance of an interest in real property; or (xii) advises or offers advice to an owner of real estate concerning the negotiation or completion of a short sale; and (B) includes a person who: (i) is employed by or for an owner of real estate to sell any portion of the real estate; ...”

See Tex. Occ. Code § 1101.002(1) (emphasis added). The underlined portions

reflect the sections applicable to Taylor’s efforts on the day of the subject crash. As

described in detail above, within section B(2) concerning joint-enterprise, Taylor

admitted to having an affair with the landscaper. Putting aside the propriety of that

relationship from the standpoint of Defendant Taylor’s marriage, this was a couple—

boyfriend and girlfriend—who were in East Austin to perform landscaping work in

service of selling real estate. They spent the entire day oriented towards the

marketing 2705 Crest Avenue for Appellee MRM. They were both over an hour

from their respective homes in Spicewood and Lakeway, and were facing the

32 prospect of a large multi-day job. They obtained a hotel room to cope with that fact.

Leading up to the crash Taylor and the landscaper’s activities could be summarized

as:

• they tried to check in at the hotel first thing in the morning, but couldn’t

get in; Supp. CR 324-326; 328 (67:13-68:13; 70:11-22).

• they took the landscaper’s truck to Home Depot to get a chainsaw and

other supplies for the job ahead; Id.

• they returned to the hotel where they checked in, and set their bags

down in the room; Id.

• from there, Defendant Taylor went outside to move her car out of the

sun. (Note that a jury would be entitled to conclude that Taylor was

likely moving her car because she and the landscaper were about to take

his truck to the listed property in order to commence work. Rather than

a detour, this remains consistent with working on the property. Moving

her car was a logical first step in commencing work at the listed

property); Id. (67:6-12; 70:11-22).

• at some point as she is moving her car, Taylor decides to look to see if

a car wash is nearby. (This detour, if it was a detour at all, is incidental

and nonetheless consistent with directives from the defendant for

33 agents to keep their car clean); Supp. CR 327 (71:4-22).

• Taylor ends up on the apron of the hotel driveway, peering around for

a touchless carwash; Id.

• She decides to exit the property and re-enter at the hotel one driveway

to the west, rather than reversing within the parking lot; Id.

• At that point she negligently pulls directly in front of the Plaintiff’s

motorcycle, which was traveling eastbound on Oltorf Street, resulting

in devastating injuries to Plaintiff. Supp. CR 314-317 (33:18-21; 34:24-

36:18); See also police report at Supp. CR 347-48; See Appendix Ch.7.

What is clear from these events is that Defendant Taylor was in east Austin

from far-off Lakeway because she was generally engaged in “selling real estate” as

specified in Section 1101.002(1)(A)(i), and/or she was “offering” to sell real estate

under Section 1101.002(1)(A)(ii), and/or she was “listing” real estate under Section

1101.002(1)(A)(iv). She could also be said to be continually engaged in procuring

property (she was coming back from getting the chainsaw and other materials) to

effectuate the sale of real estate, as specified in Section 1101.002(1)(A)(viii). For all

of this, she was at all times employed by the owner of the real estate, Reginald

Taylor, to sell the real estate pursuant to Section 1101.002(1)(B)(i). Therefore,

Appellee MRM has failed to conclusively negate this theory of liability and Plaintiff

34 is entitled to trial on the merits.

4. Texas Labor Code jurisprudence is persuasive in favor of ‘course and scope’ versus ‘detour’ for each of Appellant’s theories of recovery.

Plaintiff has located no direct case law to guide the Court as to the ‘detour’

boundaries of “course and scope” within the context of the Texas Real Estate License

Act, or joint-enterprise liability. However, Texas Courts have long analyzed

questions arising from worker “detours”, “special missions”, and “dual purpose

travel” within the context of the Texas Labor Code. Those cases are persuasive to

the extent they address Texas public policy questions about who should bear risks

that arise from business activity in Texas. See e.g., Tex. Mut. Ins. Co. v. Jerrols, 385

S.W.3d 619 (Tex. App.—Houston [14th Dist.] 2012, pet. dism'd); Zurich Am. Ins.

Co. v. McVey, 339 S.W.3d 724 (Tex. App.—Austin 2011, pet. denied).

a. The dual purpose rule

Texas Courts have followed the “dual purpose rule”, which holds that dual-

purpose travel (combined personal and business travel) is within the course and

scope of employment if: (1) the travel to the place of occurrence, here Lakeway to

east Austin, or even Home Depot to the La Quinta hotel, or even Taylor’s initial

parking spot to the crash location, would have occurred even if no personal or private

affairs were furthered by the travel; and (2) the travel would not have occurred had

35 there not been affairs of the business to be furthered by the travel. See Tex. Mut. Ins.

Co. v. Jerrols, 385 S.W.3d 619, 625 (Tex. App.—Houston [14th Dist.] 2012, pet.

dism'd)

If such a rule were followed here, the fact of Defendant Taylor’s affair with

the landscaper would be inconsequential in view of the fact that Taylor’s presence

in east Austin that day would have occurred even if she selected a different

landscaper to complete the work, and would not have occurred but for the business

interests that were furthered in improving a property that was listed for sale by

Defendant Taylor and Appellee MRM. Likewise, Taylor moving her car out of the

sun in preparation for taking the landscaper’s truck from the hotel to the jobsite was

part of the job. Likewise, Taylor taking the opportunity to peer around for car washes

while moving her car, does not rise to the level of a distinct personal errand that

would remove her from the course and scope of her employment (or joint enterprise

activities, or real estate activities), especially in view of MRM’s directive requiring

agents like Taylor to keep their cars clean as a part of their work.

b. The continuous coverage doctrine

This Court’s own Labor Code jurisprudence has repeatedly affirmed the

“continuous coverage” doctrine for out-of-town business travel. “An employee is

generally within the course and scope of his employment when the employer's

36 business requires him to travel away from the employer's premises.” Zurich Am. Ins.

Co. v. McVey, 339 S.W.3d 724, 731 (Tex. App.—Austin 2011, pet. denied)(citing

Shelton v. Standard Ins. Co., 389 S.W.2d 290, 293-94 (Tex. 1965); Aetna Cas. &

Sur. Co. v. Orgon, 721 S.W.2d 572, 574-75 (Tex. App.—Austin 1986, writ ref'd

n.r.e.).

“In fact, relying on what has come to be known as the "continuous coverage"

rule, the supreme court and this Court have both held that the course and scope of

employment in cases of overnight travel is broad, extending even beyond the actual

act of travel itself to include injuries sustained during ‘down time.’” Id. (citing

Shelton, 389 S.W.2d at 293-94 (employee injured crossing street from hotel to

restaurant was in course and scope); Orgon, 721 S.W.2d at 575 (employee injured

by broken glass in hotel was in course and scope).

As such, if this were a workers’ compensation case, it is clear that Texas law

would allocate the risk of injury to the business whose interest was furthered by

Taylor’s travel to east Austin from Lakeway—in this case Appellee MRM.

In any case, this Court has previously instructed that that, generally speaking,

“[c]ourse and scope of employment is . . . a fact issue like negligence or proximate

cause.” Arbelaez v. Just Brakes Corp., 149 S.W.3d 717, 720 (Tex. App. – Austin

2004, no pet.).

37 In sum, there are, at a minimum, genuine issues of material fact as to whether

Taylor was performing an act that would bring her within the scope of the Texas

Occupations Code’s requirement that real estate brokers like MRM answer for the

tortious conduct of their salespersons. The same is true for respondeat superior

liability, and joint-enterprise liability.

C. The Trial Court Erred in Granting MRM’s No Evidence Motion for Summary Judgment

Because Appellee MRM’s traditional motion for summary judgment concerns

the same theories of liability attacked in its no evidence motion for summary

judgement, Plaintiff’s above responses to Appellee MRM’s traditional motion are

already responsive to Appellee’s No Evidence Motion for Summary Judgment, and

are hereby incorporated by reference. The same evidence cited above that raises

genuine issues of material fact, likewise presents more than a scintilla of evidence

for each of the elements challenged within Appellee MRM’s no-evidence motion.

As such, the trial court erred in granting Appellee’s no-evidence motion for

summary judgment.

PRAYER

Appellee MRM has failed to offer sufficient evidence to conclusively negate

its vicarious liability for the tortious conduct of Defendant Taylor. Therefore, the

38 trial court erred in granting Appellee MRM’s Traditional Motion for Summary

Judgement.

Further, the summary evidence meets and exceeds the level that would enable

reasonable and fair-minded people to differ in their conclusions with respect to each

of the challenged elements within Appellant Stroup’s theories of vicarious liability,

including respondeat superior, joint enterprise, and statutory vicarious liability.

Because Stroup presents more than a scintilla of evidence to support each of the

challenged elements of Stroup’s cause of action, Appellee’s no-evidence motion for

summary judgment was improperly granted, and Stroup is entitled to a trial on the

merits.

WHEREFORE, PREMISES CONSIDERED, Appellant prays that this Court

reverse the order of the trial court granting Defendant’s Traditional and No-Evidence

Motion for Summary Judgment, and for such other and further relief to which

Appellant’s may be entitled.

39 Respectfully submitted,

FOGELMAN & VON FLATERN, LLP 3101 Bee Cave Road, Suite 270 Austin, Texas 78746 (512) 375-3198 (512) 372-3209 (telecopier)

By: /s/ Aaron von Flatern Aaron von Flatern State Bar No. 24076892 aaron@fvlawfirm.com

COUNSEL FOR APPELLANT

40 CERTIFICATE OF SERVICE The undersigned certifies that on January 1, 2018 a true and correct copy of the above and foregoing was served via electronic filing to all counsel below:

WALTERS, BALIDO & CRAIN, L.L.P. Gregory R. Ave Meadow Park Tower, Suite 1500 10440 North Central Expressway Dallas, TX 75231 AveEdocsNotifications@wbclawfirm.com

COUNSEL FOR APPELLEE

/s/ Aaron von Flatern Aaron von Flatern

CERTIFICATE OF COMPLIANCE

I certify that this document contains 9,095 words (counting all parts of the document). The body text is in 14 point font, and the footnote text is in 12 point font.

41 APPENDIX

I. Judgment on appeal

II. Tex. Occ. Code Excerpts

III. Gibson v. Davis Realty

IV. Independent Contractor Agreement

V. Keller Williams Policies and Guidelines

VI. Listing Agreement

VII. Police Report I. Judgment on Appeal Filedin The DistrictCourt of TravisCounty,Texas ..:i:;;:

FEB2_8 2017 -/ft- CAUSE NO . D-1-GN-15-004909 At ~a,~- VelvaL. Pee; DistricClerk SARAH DENISE STROUP, AS LEGAL § IN THE DISTRICT COURT OF GUARDIAN OF DOUGLAS LEE STROUP, § AN INCAPACITATED PERSON § § vs. § TRAVIS COUNTY, TEXAS § PENNY HARRINGTON TAYLOR AND § MRM MANAGEMENT, INC. § 9g th JUDICIAL DISTRICT

ORDER GRANTING DEFENDANT, MRJ\1 MANAGEMENT, INC.'S FIRST AMENDED TRADITIONAL AND NO-EVIDENCJB:MOTION FOR SUMMARY JUDGMENT

On February 22, 2017, the Court considered Defendant MRM Management, Inc.'s First

Amended Traditional and No-Evidence Mot ion for Summary Judgment (the "Motion") . After

reviewing the Motion , Plaintiffs Response , the evidence presented , the arguments of counsel,

and applicable law, the Court is of the opinion that the Motion should be and is hereby

GRANTED.

IT IS THEREFORE ORDERED that Defendant MRM Management , Inc. 's First

Amended Traditional and No-Evidence Mot ion for Summary Judgment is GRANTED.

IT IS FURTHER ORDERED that Plaintiffs claims against Defendant MRM

Management , Inc. are DISMISSED with prejudice.

-rv SIGNED this ')J day of February 20 17.

11111111 1 11111111111111111111111111111111111111 IIIIIIII 005071659

ORDER GRANTING DEFENDANT, MRM MANAGEMENT, INC.'S FIRST AMENDED TRADITIONAL AND NO-EVIDENCE MOTION FOR SUMMARY JUDGMENT 407 II. Tex. Occ. Code Excerpts · LexisNexis · User Name: aaronvonflatern Date and Time: Thursday, December 28, 2017 10:36:00 AM CST Job Number: 58744145

Documents (4)

1. Tex. Occ. Code § 1101.001 Client/Matter: -None- Search Terms: Search Type:

2. Tex. Occ. Code § 1101.002 Client/Matter: -None- Search Terms: Search Type:

3. Tex. Occ. Code § 1101.351 Client/Matter: -None- Search Terms: Search Type:

4. Tex. Occ. Code § 1101.803 Client/Matter: -None- Search Terms: Search Type:

Lexi Ne.x i '"| _______________ _ About LexisNexis | Privacy Policy | Terms & Conditions | Copyright © 2017 LexisNexis Tex. Occ. Code § 1101.001 This document is current through the 2017 Regular Session and 1st C.S., 85th Legislature

Texas Statutes & Codes Annotated by LexisNexis® > Occupations Code > Title 7 Practices and Professions Related to Real Property and Housing > Subtitle A Professions Related to Real Estate > Chapter 1101 Real Estate Brokers and Sales Agents [Expires September 1, 2019] > Subchapter A General Provisions [Expires September 1, 2019]

Sec. 1101.001. [Expires September 1, 2019] Short Title.

This chapter may be cited as The Real Estate License Act.

History

Enacted by Acts 2001, 77th Leg., ch. 1421 (H.B. 2813), § 2, effective June 1, 2003.

Texas Statutes & Codes Annotated by LexisNexis® Copyright © 2017 Matthew Bender & Company, Inc. a member of the LexisNexis Group. All rights reserved.

End of Document Tex. Occ. Code § 1101.002 This document is current through the 2017 Regular Session and 1st C.S., 85th Legislature estate; Texas Statutes & Codes Annotated by LexisNexis® > Occupations Code > Title 7 Practices and Professions (vii) aids or offers or attempts to aid Related to Real Property and Housing > Subtitle A in locating or obtaining real Professions Related to Real Estate > Chapter 1101 estate for purchase or lease; Real Estate Brokers and Sales Agents [Expires (viii) procures or assists in September 1, 2019] > Subchapter A General procuring a prospect to effect Provisions [Expires September 1, 2019] the sale, exchange, or lease of real estate; Sec. 1101.002. [Expires September 1, (ix) procures or assists in procuring 2019] Definitions. property to effect the sale, exchange, or lease of real estate; In this chapter: (x) controls the acceptance or (1) “Broker”: deposit of rent from a resident of (A) means a person who, in exchange a single-family residential real for a commission or other valuable property unit; consideration or with the (xi) provides a written analysis, expectation of receiving a opinion, or conclusion relating commission or other valuable to the estimated price of real consideration, performs for another property if the analysis, opinion, person one of the following acts: or conclusion: (i) sells, exchanges, purchases, or (a) is not referred to as an leases real estate; appraisal; (ii) offers to sell, exchange, (b) is provided in the ordinary purchase, or lease real estate; course of the person’s (iii) negotiates or attempts to business; and negotiate the listing, sale, (c) is related to the actual or exchange, purchase, or lease of potential management, real estate; acquisition, disposition, or (iv) lists or offers, attempts, or encumbrance of an interest agrees to list real estate for sale, in real property; or lease, or exchange; (xii) advises or offers advice to an (v) auctions or offers, attempts, or owner of real estate concerning agrees to auction real estate; the negotiation or completion of a short sale; and (vi) deals in options on real estate, including a lease to purchase or (B) includes a person who: buying, selling, or offering to (i) is employed by or for an owner buy or sell options on real of real estate to sell any portion Page 2 of 2 Tex. Occ. Code § 1101.002

of the real estate; or who: (ii) engages in the business of (A) represents a principal through charging an advance fee or cooperation with and the consent of contracting to collect a fee a broker representing the principal; under a contract that requires the and person primarily to promote the (B) is not sponsored by or associated sale of real estate by: with the principal’s broker. (a) listing the real estate in a publication primarily used History for listing real estate; or (b) referring information about Enacted by Acts 2001, 77th Leg., ch. 1421 (H.B. the real estate to brokers. 2813), § 2, effective June 1, 2003; am. Acts 2003, 78th Leg., ch. 1276 (H.B. 3507), § 14A.151, (1-a) “Business entity” means a “domestic effective September 1, 2003; am. Acts 2011, 82nd entity” or “foreign entity” as those Leg., ch. 1064 (S.B. 747), § 1, effective September terms are defined by Section 1.002, 1, 2011; am. Acts 2015, 84th Leg., ch. 1158 (S.B. Business Organizations Code, that is 699), § 2, effective January 1, 2016. qualified to transact business in this state. Texas Statutes & Codes Annotated by LexisNexis® (2) “Certificate holder” means a person Copyright © 2017 Matthew Bender & Company, Inc. registered under Subchapter K. a member of the LexisNexis Group. All rights reserved. (3) “Commission” means the Texas Real Estate Commission. End of Document (4) “License holder” means a broker or sales agent licensed under this chapter. (5) “Real estate” means any interest in real property, including a leasehold, located in or outside this state. The term does not include an interest given as security for the performance of an obligation. (6) “Residential rental locator” means a person who offers for consideration to locate a unit in an apartment complex for lease to a prospective tenant. The term does not include an owner who offers to locate a unit in the owner’s complex. (7) “Sales agent” means a person who is sponsored by a licensed broker for the purpose of performing an act described by Subdivision (1). (8) “Subagent” means a license holder Tex. Occ. Code § 1101.351 This document is current through the 2017 Regular Session and 1st C.S., 85th Legislature Texas Statutes & Codes Annotated by LexisNexis® Texas Statutes & Codes Annotated by LexisNexis® > Copyright © 2017 Matthew Bender & Company, Inc. Occupations Code > Title 7 Practices and Professions a member of the LexisNexis Group. All rights reserved. Related to Real Property and Housing > Subtitle A Professions Related to Real Estate > Chapter 1101 Real Estate Brokers and Sales Agents [Expires End of Document

September 1, 2019] > Subchapter H License Requirements [Expires September 1, 2019]

Sec. 1101.351. [Expires September 1, 2019] License Required.

(a) Unless a person holds a license issued under this chapter, the person may not: (1) act as or represent that the person is a broker or sales agent; or (2) act as a residential rental locator. (a-1)Unless a business entity holds a license issued under this chapter, the business entity may not act as a broker. (b) An applicant for a broker or sales agent license may not act as a broker or sales agent until the person receives the license evidencing that authority. (c) A licensed sales agent may not engage or attempt to engage in real estate brokerage unless the sales agent is sponsored by a licensed broker and is acting for that broker.

Enacted by Acts 2001, 77th Leg., ch. 1421 (H.B. 2813), § 2, effective June 1, 2003; am. Acts 2011, 82nd Leg., ch. 1064 (S.B. 747), § 5, effective September 1, 2011; am. Acts 2015, 84th Leg., ch. 1158 (S.B. 699), § 29, effective January 1, 2016. Tex. Occ. Code § 1101.803 This document is current through the 2017 Regular Session and 1st C.S., 85th Legislature

Texas Statutes & Codes Annotated by LexisNexis® > Occupations Code > Title 7 Practices and Professions Related to Real Property and Housing > Subtitle A Professions Related to Real Estate > Chapter 1101 Real Estate Brokers and Sales Agents [Expires September 1, 2019] > Subchapter Q General Provisions Relating to Liability Issues [Expires September 1, 2019]

Sec. 1101.803. [Expires September 1, 2019] General Liability of Broker.

A licensed broker is liable to the commission, the public, and the broker’s clients for any conduct engaged in under this chapter by the broker or by a sales agent associated with or acting for the broker.

Enacted by Acts 2001, 77th Leg., ch. 1421 (H.B. 2813), § 2, effective June 1, 2003; am. Acts 2015, 84th Leg., ch. 1158 (S.B. 699), § 89, effective January 1, 2016.

Texas Statutes & Codes Annotated by LexisNexis® Copyright © 2017 Matthew Bender & Company, Inc. a member of the LexisNexis Group. All rights reserved.

End of Document III. California Case -Gibson v. Davis Realty Gipson v. Davis Realty Co. [Civ. No. 20032. First Dist., Div. One. Apr. 18, 1963.]

THOMAS WESLEY GIPSON, a minor, etc., et al., Plaintiffs and Appellants, v. DAVIS REALTY COMPANY, Defendant and Respondent.

COUNSEL

Walkup & Downing, Bruce Walkup, Robert Ransom and Wiliam B. Boone for Plaintiffs and Appellants.

Hadsell, Murman & Bishop, Bishop, Murray & Barry, Herbert Chamberlain and Nelson Barry for Defendant and Respondent.

OPINION

MOLINARI, J.

This is an appeal from a judgment in favor of the defendant, Davis Realty Company, a corporation, in an action for damages for personal injuries.

On April 4, 1957, Mrs. Jane Gipson, who was pregnant with child, was being transported by ambulance to the Stanford Hospital where her child was to be delivered. A collision between the ambulance and an automobile owned and driven by Roland Shugg occurred at the intersection of 26th Avenue and Clement Street in San Francisco. The accident occurred at about 12:20 p.m. The child was born about 40 minutes after the accident. The child showed signs of brain damage immediately after the accident, it being subsequently determined that such damage was permanent and that the child was suffering from a disability diagnosed as cerebral palsy. A personal injury action was thereafter instituted by the child's father, Edward T. Gipson, as guardian ad litem on behalf of the child, by the said father in his individual capacity, and by Mrs. Gipson against the ambulance company and its driver, and against Shugg and Davis Realty Company, a corporation, as the alleged employer of Shugg. The cause proceeded to trial ultimately with the child (by his said guardian) and Edward T. Gipson, individually, as plaintiffs, and Davis Realty Company as the sole defendant. A trial was had before a jury and a verdict was returned against the plaintiffs fn. 1 and for the defendant. fn. 2 No attack is made on this appeal as to the substantiality of the evidence, the appeal being directed to the propriety of certain instructions and rulings made by the trial court. fn. 3 [215 Cal. App. 2d 196]

Did the Court Commit Prejudicial Error in the Giving of Instructions Regarding Burden of Proof?

1 [1] The trial court gave an instruction on its own motion as follows: "Where the evidence is contradictory, your decision must be in accordance with the preponderance thereof. It is your duty, however, if possible to reconcile such contradiction so as to make the evidence reveal the truth. If you are in doubt as to the preponderance of the whole evidence, then you must resolve that doubt in favor of the party who has not the burden of proof." fn. 4 (Italics added.) The appellants assert that this instruction is prejudicially erroneous in that it tells the jury that the appellants were required not only to prove their case by a preponderance of the evidence, but that they were required to convince the jury beyond all doubt as to the sufficiency of their proof.

A reading of the instruction does not indicate that the jury was told that the appellants were required to prove their case beyond all doubt. What the jurors were told, however, was that if they were in doubt as to whether the evidence preponderated in favor of the appellants, they were then to find that the appellants had not met the burden of proof. While we are of the opinion that instructions using the word "doubt" ought to be avoided in civil cases on the subject of burden of proof and preponderance of the evidence, we do [215 Cal. App. 2d 197] not believe that the instant instruction is erroneous. Although, inartfully drawn, its effect, when coupled with the other instructions given by the court on the subject, fn. 5 was to tell the jury that if, after weighing the whole evidence in the case, they were in the subjective state of being uncertain as to whether the evidence tending to prove the appellants' allegations had the greater weight, probability, quality and convincing effect than that presented by the opposing evidence, they were to decide that the appellants had not met the burden of proof. The jurors were not told by this instruction that the things which the appellants were required to prove must not admit of any doubt, but rather, that, if after weighing the whole evidence in support of these things, they were in the frame of mind where they could not say that such evidence preponderated on the side of the appellants, they were to conclude that it did not so preponderate.

The appellants have cited several cases in support of their assertion of error, fn. 6 but these are distinguishable from the instruction in the instant case primarily because of the specific language used, and the connotation it conveyed, that the degree of certainty indicated with reference to the particular allegations to be proved must not only be beyond doubt, but must not admit of any doubt at all. In Greenleaf v. Pacific Tel. & Tel. Co., 43 Cal. App. 691, 693 [185 P. 872], the portion of the instruction which resulted in a reversal read as follows: " '[A]nd if the preponderance of the evidence fails to satisfy you that the fire was so caused, or leaves in your mind any doubt, confusion or uncertainty as to the origin of the fire, your verdict should be for the defendant.' " (P. 693.) The erroneous instruction given in Colbert v. Borland, 147 Cal. App. 2d 704, 712 [306 P.2d 53], stated that: " 'The burden is upon each plaintiff in these cases to prove the affirmative of his case by a preponderance of the evidence. Therefore, you may not speculate as to whether any conduct on the part of either defendant was a proximate cause of the accident or of any one of plaintiff's injuries or damages, and if the evidence leaves these things a matter of conjecture or doubt, then that plaintiff has not sustained the burden of [215 Cal. App. 2d 198] proof required of him under the law as against that defendant.' " (Italics partly added.) The instruction given in Meschini v. Guy F. Atkinson Co., 160 Cal. App. 2d 609, 615 [325 P.2d 213], was almost identical to the one condemned in Colbert. In Banes v. Dunger, 181

2 Cal. App. 2d 276, 282 [5 Cal. Rptr. 278], the court gave an instruction to the effect that the jury was not to speculate as to any injuries claimed by the plaintiffs, and that if the evidence left the existence or cause of any alleged injuries a matter of conjecture or doubt, that then the plaintiffs had not sustained the burden of proof. The Perrett v. Southern Pac. Co., 73 Cal. App. 2d 30 [165 P.2d 751], case did not involve the use of the word "doubt." There an instruction was given that the defendant could be held liable only " 'upon proof which satisfies your mind that the plaintiff's injuries were proximately caused by some negligence upon its part.' " (P. 38; italics added.)

In Popejoy v. Hannon, 37 Cal. 2d 159 [231 P.2d 484], the court on its own motion instructed that: " 'The defendants, however, are not required to prove by a preponderance of the evidence that they were free from negligence which proximately caused the lumber to fall. They are bound to produce only sufficient evidence to create in your minds such doubt as to why the lumber fell that you cannot say you are convinced by a preponderance of the evidence that the falling of the lumber was proximately caused by the negligence of the defendants.' " (Pp. 164-165.) The defendants there complained of the instruction, and while the appellate court had some misgivings as to the instruction (not because of the use of the word "doubt," but because it tended to place upon the defendants the requirement to present direct evidence either of their freedom from negligence or the absence of proximate cause), it held that the instruction was not prejudicial under circumstances wherein an instruction was given at the request of the defendants substantially in the form of BAJI No. 21. fn. 7 The court there said that there was "little difference" between the challenged instruction and the one requested by the [215 Cal. App. 2d 199] defendants, and that "The effect of the instruction complained of was to say that the Hannons [the defendants], in order to defeat Popejoy's [the plaintiff's] claim, had the duty to produce a preponderance of evidence to the contrary." fn. 8 (P. 165.)

It should be here noted that the appellants themselves claim error on the part of the court in failing to give an instruction requested by them containing the following language: "It is the duty of the jury to decide for the plaintiff if the weight of the evidence preponderates, according to the reasonable probability of truth, in favor of the plaintiff's claims, even though the minds of the jurors are not free from doubt." (Italics added.) The court did not give this instruction but placed thereon the notation: "Given as Modified." The court was apparently of the opinion that in essence this instruction was covered by the subject instruction to the extent that the former was modified by the latter. We see little difference between the two instructions. Suffice it to say, the terminology "greater probabilities of truth," "probability of the truth" and the "greater probability" with reference to the meaning of "preponderance of evidence" in burden of proof instructions is in common use by the courts and has been approved. (See Popejoy v. Hannon, supra, 37 Cal. 2d 159; and see BAJI No. 21, rev. 1962.) fn. 9 The word "probability" by its very definition leaves some room for doubt. In Brown v. Beck, 63 Cal. App. 686 [220 P. 14], we find the following language: " 'Probability' means the state or character of being probable. Webster's and the Century dictionaries define 'probable' as follows: 'Having more evidence for than against; supported by evidence which inclines the mind to belief but leaves some room for doubt; likely.' This definition is accepted in numerous cases in which the word 'probable' is construed." (Pp. 697-698.)

3 Did the Court Commit Prejudicial Error in the Giving and Refusing to Give Instructions as to the Effect of the Employment Contract?

At the time of the accident in question Shugg was one of four stockholders in the respondent corporation. He was neither an officer nor a director of the corporation. On February 19, 1957, Shugg entered into a contract with the respondent [215 Cal. App. 2d 200] entitled "Desk Space Contract with Tenant- Salesman." According to said contract Shugg agreed to pay 50 per cent of the profits from his real estate activities in exchange for the desk space, telephone, stenographic, and bookkeeping services located at 5000 Geary Boulevard, San Francisco. The said agreement further provided that Shugg was not to be deemed to be an employee of the respondent, and that the latter did not control or have any right of control over Shugg's acts. Attached to the contract was a separate agreement concerning the disposition of gross commissions, a detailed schedule setting out the division of various sales commissions, and a list of working conditions one of which was that all employees were required to show a Mrs. McAnaw fn. 10 that they carried adequate automobile liability insurance. Other conditions and stipulations made reference to "salesman" and to "broker." Testimony was adduced at the trial to the effect that the above contract was entered into with the intent of saving the necessity of keeping bookkeeping records and with the intent on the part of the respondent to treat its salesmen as independent contractors. Shugg testified, however, that it was not the intent to make the salesman independent contractors because the salesmen knew that they could not be such as they were not licensed as brokers.

The evidence discloses that Shugg was licensed as a real estate salesman only, and that he never had been licensed as a broker. It appears that all transactions entered into by Shugg were in compliance with the California Business and Professions Code regulating real estate transactions; that all real estate deals made by Shugg were made in the name of "Davis Realty"; that deposit receipts and similar papers were signed " 'Davis Realty, by R. P. Shugg' "; and that all listings brought in by Shugg were signed as listings of Davis Realty which would remain the property of Davis Realty if Shugg resigned. There was testimony, also, that all advertising was in the name of Davis Realty; that Shugg, when conducting a transaction, represented to customers that he was acting for Davis Realty; that the salesmen were expected to rotate "floor days" during which they stayed in the office all day, took calls, and met people who came in off the street; and that Shugg was required, as a salesman, to satisfy Mrs. McAnaw that he had adequate automobile liability insurance. [215 Cal. App. 2d 201]

The "Working Agreement" referred to above provided that all salesmen could be terminated on 30-day notice. In this regard, Shugg testified that a couple of salesmen were asked to transfer their licenses to other brokers; and Ross, respondent's president, testified that while the company had never fired anyone, a couple of salesmen were asked to terminate because of an infraction of policy.

After defining for the jurors the meaning of "independent contractor" and "agent," and instructing them that if they found Shugg to be an independent contractor then the respondent would not be liable, but if they found him to be an agent, acting within the

4 scope of his authority at the time of the accident, the respondent would be liable, the court gave the following instruction with regard to the employment contract between Shugg and Davis Realty Company, to wit: "The contract which exists between the Davis Realty Company and Roland Shugg is prima facie evidence of the relationship between them. That is to say in the absence of any other evidence it is the controlling factor in determining whether or not Roland Shugg was at the time of the accident an independent contractor. However, where further evidence is introduced with respect to the actual working arrangement between the parties you may take this into consideration in making your decision as to the relationship between the parties. You may look at the actual working arrangement in the light of the rules previously read to you and recall that the decisive test of the relationship is who has the right to direct what shall be done, when and how it shall be done. Or to put the test in another form, who has the right to general and immediate control over the progress and method of the work involved." (Italics added.)

The appellants contend that prejudicial error was committed by the trial court in the giving of this instruction. The objection is directed to the use of the words "prima facie evidence" and "controlling factor. ..." It is argued by the appellants that this instruction purported to attribute to the contract some conclusive or presumptive effect. The appellants assert that the jury could find by the other evidence produced that the rule relationship between Shugg and Davis Realty was that of principal and agent and that in so doing the jury was at liberty to ignore the provisions of the contract which purport to negate such relationship. The appellants argue further that while the court did instruct the jury that it "may" consider such other evidence, a correct instruction [215 Cal. App. 2d 202] would have stated that it "must" consider such evidence. The proper instruction, say the appellants, was that embodied in their proposed instruction number 65, which the court refused to give. fn. 11 The appellants claim that such refusal was prejudicial error.

[2] The instruction given was a correct statement of the law insofar as it declared that the relation of the parties to a written contract of employment is prima facie that which is expressed by the terms of their writing. (Luckie v. Diamond Coal Co., 41 Cal. App. 468, 479 [183 P. 78]; Stewart & Nuss v. Industrial Acc. Com., 55 Cal. App. 2d 501 [130 P.2d 985].) [3] It is proper, moreover, in view of the established rule that parol evidence is admissible in an action by one not a party to an employment contract to show the true relationship between the parties (Broder v. Epstein, 101 Cal. App. 2d 197, 199 [225 P.2d 10]; Marx v. McKinney, 23 Cal. 2d 439, 442 [144 P.2d 353]; Luckie v. Diamond Coal Co., supra, p. 478; and see Code Civ. Proc., § 1856), for a trial court to admit extrinsic evidence to be weighed against the presumption afforded by such prima facie evidence. Such extrinsic evidence was so admitted in the present case. The questioned instruction, however, tells the jury that it "may" take such evidence into consideration. [4] While in the construction of statutes the word "may" is often interpreted to mean "must" or "shall," the word is primarily and ordinarily a permissive term and is so understood by laymen. The word "may" here imported to the jury that it might, or might not, at its option, consider such evidence. (See White v. Disher, 67 Cal. 402, 404 [7 P. 826].) [5] A jury is duty bound to consider and weigh all of the evidence received by the court under appropriate instructions. (Borenkraut v. Whitten, 56 Cal. 2d 538, 546 [15 Cal. Rptr. 635, 364 P.2d

5 467]; Ensign v. Southern Pac. Co., 193 Cal. 311, 323 [223 P. 953].) The instruction [215 Cal. App. 2d 203] proposed by the appellants, on the other hand, appears to state the rule of Broder and Luckie correctly and should have been given by the court, fn. 12 assuming, of course, that it was proper for the court to instruct on the effect of the employment contract.

[6a] We are of the opinion, however, that it was error for the court to have given any instructions on the effect of the employment contract because Shugg was an agent of the respondent as a matter of law. A proper instruction, therefore, would have been one so advising the jury. In Grand v. Griesinger, 160 Cal. App. 2d 397 [325 P.2d 475], it was held that a real estate salesman "is strictly the agent of the broker." (P. 406; italics added.) The appellate court was there called upon, in a salesman license revocation case, to interpret the Real Estate Act (Bus. & Prof. Code, §§ 10000-11709) in its application to the relationship between a real estate broker and a real estate salesman. In discussing the applicable statutes the reviewing court pointed out that "[t]he differences in language are small, but the divergence in import is large." (P. 405.) After citing sections 10131 fn. 13 and 10132, fn. 14 defining "real estate broker" and "real estate salesman," respectively, the court observed as follows: "A broker performs the specified services 'for another or others,' meaning the public, while a salesman must be 'employed by a licensed real estate broker.' Both act for compensation, but the salesman cannot 'be employed by or accept compensation from any person other than the broker under whom he is at the time licensed.' " (P. 405; italics added; citing § 10137.) The [215 Cal. App. 2d 204] court went on to point out that a salesman can only get a license on the recommendation of the broker who is to be his employer (§ 10151); that when a salesman's application is granted his license goes into possession of his broker-employer and there remains until cancelled or the salesman leaves the employ of the broker (§ 10160); and that the broker must " 'exercise reasonable supervision over the activities of his salesmen' " or hazard the suspension or revocation of his own license (§ 10177, subd. (h); p. 405]. The conclusion reached by Grand, after a review of the foregoing statutes and other related provisions, is that: "The entire statutory scheme requires the broker actively to conduct his brokerage business and to supervise the activities of his salesmen." (P. 406.)

The respondent maintains that whether a real estate salesman is an employee or agent on the one hand, or an independent contractor on the other, is a question of fact dependent upon the particular circumstances of each case. In support of this proposition it cites the following cases: California Emp. Stab. Com. v. Norins Realty Co. (1946) 29 Cal. 2d 419 [175 P.2d 217]; California Emp. Stab. Com. v. Morris (1946) 28 Cal. 2d 812 [172 P.2d 497]; and Royal Indem. Co. v. Industrial Acc. Com. (1930) 104 Cal. App. 290 [285 P. 912]. In Morris the question before the Supreme Court was whether a real estate salesman was to be deemed "in employment" within the meaning of the Unemployment Insurance Act. The court held that "[t]he Real Estate Act ... does not establish as a matter of law the status of every salesman as being 'in employment' within the meaning of the Unemployment Insurance Act." (P. 817.) The rationale of Morris is that "[t]he Real Estate Act of this state does not expressly give the employer the right to control the manner and means of accomplishing the result desired, nor do its provisions conclusively negative all of the other factors to be considered in determining whether one

6 is an independent contractor. Accordingly, the occupation of real estate salesman, insofar as the Unemployment Insurance Act is concerned, is one that may be classified as that of an employee, or an independent contractor, depending upon the facts of the particular case." (P. 818; italics added.) Norins Realty Co. also involved the applicability of the Unemployment Insurance Act to real estate salesmen. It follows the holding in Morris. The Royal Indem. Co. case was concerned with workmen's compensation benefits. Like Morris, it held that whether the relationship of a real estate salesman to a broker is that of [215 Cal. App. 2d 205] an employee or independent contractor is a question depending upon the facts of the particular case. The holding there turned upon the lack of any evidence showing control over the means, manner or mode of the work exercised by the salesman.

We are persuaded that the distinction between Grand, on the one hand, and Morris, Norins Realty Co. and Royal Indem. Co., on the other, lies in the difference between an "employee" and an "agent." The basis of the holding in Morris and Norins Realty Co., with reference to the Unemployment Insurance Act, and Royal Indem. Co., with reference to the Workmen's Compensation Act, is that, insofar as these acts are concerned, the common law definition of master and servant is the measure of the relationship between the parties, and that the statutory definition of salesman in the Real Estate Act does not make a real estate salesman an "employee" within the meaning of these acts as a matter of law. [7] An "employee" is one who is subject to the absolute control and direction of his employer in regard to any act, labor or work to be done in the course and scope of his employment. (Crooks v. Glens Falls Indem. Co., 124 Cal. App. 2d 113, 121 [268 P.2d 203].) The term "employee" has been held to be synonymous with the word "servant." (Press Pub. Co. v. Industrial Acc. Com., 190 Cal. 114, 122 [210 P. 820]; Western Indem. Co. v. Pillsbury, 172 Cal. 807, 810 [159 P. 721].) Section 3000 of our Labor Code (formerly Civ. Code, § 2009) defines a servant as follows: "A servant is one who is employed to render personal service to his employer, other than in the pursuit of an independent calling, and who in such service remains entirely under the control and direction of the employer, who is called his master." An "agent" is defined by section 2295 of the Civil Code as follows: "An agent is one who represents another, called the principal, in dealings with third persons." While one may be both a servant and an agent (Ingle v. Bay Cities Transit Co., 72 Cal. App. 2d 283, 286 [164 P.2d 508]), the terms are not wholly synonymous. (People v. Treadwell, 69 Cal. 226, 236 [10 P. 502].) Although both relate to voluntary action under employment and express the idea of service, the service performed by a servant may be inferior in degree to work done by an agent for his principal. [8] Accordingly, while both a servant and an agent are workers for another under an express or implied employment, an agent works not only for, but in the place of, his [215 Cal. App. 2d 206] principal. (People v. Treadwell, supra, p. 236.) It is apparent from a reading of section 3000 of the Labor Code that the relationship of master and servant contemplates that the servant be entirely under the control and direction of the employer; it presupposes also the right to direct the method and mode of doing the service. (See Fay v. German General Benevolent Soc., 163 Cal. 118, 121 [124 P. 844]; Chinnis v. Pomona Pump Co., 36 Cal. App. 2d 633, 637 [98 P.2d 560].) [9] The distinguishing features of an agency, on the other hand, are its representative character and its derivative authority. (Store of Happiness v. Carmona & Allen, Inc., 152 Cal. App.

7 2d 266, 269 [312 P.2d 1104].) [10] As stated in Wallace v. Sinclair, 114 Cal. App. 2d 220 [250 P.2d 154]: "Agency is the relation that results from the act of one person, called the principal, who authorizes another, called the agent, to conduct one or more transactions with one or more third persons and to exercise a degree of discretion in effecting the purpose of the principal. The heart of agency is expressed in the ancient maxim: 'Qui facit per alium facit per se.' " (P. 229; italics partly added.)

It should be noted, moreover, that Morris, Norins Realty Co. and Royal Indem. Co. were decided prior to the addition by the Legislature in 1955 of subdivision (h) to section 10177, providing an additional ground for the suspension or revocation of a real estate broker's license, i.e., that such broker's license may be suspended or revoked if he fails "to exercise reasonable supervision over the activities of his salesmen." The presence of this provision in the Real Estate Law, read in conjunction with the other provisions applicable to real estate salesmen, was deemed by the reviewing court in Grand to be indicative of a legislative intent to create by statute, as between a real estate broker and the salesman licensed under such broker, respectively, the relationship of principal and agent.

[11] We are satisfied, accordingly, that while it may be a question of fact whether in each case a real estate salesman is an employee within the common law definition of master and servant, the Legislature has, by virtue of statutory enactment, made such a salesman an agent of the broker as a matter of law. [12] A consideration of the several statutory provisions applicable to a real estate salesman impels the conclusion that such person can act only for, on behalf of, and in place of the broker under whom he is licensed, and that his acts are limited to those which he does and performs [215 Cal. App. 2d 207] as an agent for such broker. (Galbavy v. Chevelin Realty Corp., 58 Cal. App. 2d Supp. 903, 906 [136 P.2d 134].) [13] We conclude, therefore, that a salesman, insofar as his relationship with the broker who employs him is concerned, cannot be classed as an independent contractor. Accordingly, any contract which purports to change that relationship from that of agent to independent contractor is invalid as being contrary to the provisions of the Real Estate Law. (See Civ. Code, §§ 1608, 1667.) [6b] It was reversible error for the court, therefore, to instruct the jury that the contract of employment between Shugg and the respondent was "prima facie" evidence of their relationship in view of the terms of the contract providing that the relationship was that of independent contractor. In the absence of such error it is reasonably probable that a result more favorable to the appellants might have been reached. (See People v. Watson, 46 Cal. 2d 818, 835-836 [299 P.2d 243].)

While the error in this latter respect was induced by both the respondent and the appellants, it was not "invited error" on the part of appellants. The case was tried on the theory that the question whether Shugg was an independent contractor was one of fact for the jury and instructions were submitted by both sides not only on the effect of the subject employment contract, but on the meaning and definition of the relationship of independent contractor. [14] It is well settled law that where a litigant invites error by offering instructions on a certain issue, he is in no legal position to complain that it was error to give instructions offered by the adversary, or given by the court on the same issue. (Fuentes v. Panella, 120 Cal. App. 2d 175, 182 [260 P.2d 853]; Wells v. Lloyd, 21

8 Cal. 2d 452 [132 P.2d 471].) [15] In the instant case the doctrine of invited error would preclude the appellants from complaining that the court instructed on the issue of whether or not Shugg was an independent contractor and of the effect of the employment contract with respect to the relationship between the respondent and Shugg. The doctrine does not, however, estop the appellants from urging on appeal that an instruction given on that issue was in fact erroneous. As we have pointed out above, even if it had been proper for the court to instruct on the effect of the employment contract with respect to the relationship in question, the instruction given on the subject was prejudicially erroneous. The doctrine of invited error precludes a party from an objection on appeal to an instruction substantially the same [215 Cal. App. 2d 208] as the one requested by him, or invited by an instruction requested by him, or to the part of an instruction containing the same vice as the one submitted by him. (Jentick v. Pacific Gas & Elec. Co., 18 Cal. 2d 117, 122 [114 P.2d 343]; Smith v. Kile, 147 Cal. App. 2d 314, 317 [304 P.2d 1034]; Jansen v. Southern Pac. Co., 112 Cal. App. 2d 833, 845 [247 P.2d 581]; Yolo Water & Power Co. v. Hudson, 182 Cal. 48, 51 [186 P. 772]; George v. City of Los Angeles, 51 Cal. App. 2d 311, 319-320 [124 P.2d 872].) In the present case the instruction submitted by the appellants on the effect of the employment was substantially different from that submitted by the respondent; it did not contain the same vice. [16] The doctrine of invited error does not apply where the instruction objected to on appeal contains elements or additions substantially different from that contained in the instruction submitted by appellant, particularly where such instruction is prejudicial to him and is not the law. (Baker v. Borello, 131 Cal. 615, 616-617 [63 P. 914]; Dowd v. Atlas Taxicab etc. Co., 69 Cal. App. 9, 14 [230 P. 958].)

Did the Court Commit Error in Refusing Instructions Defining the Right of Control and the Factors to be Considered?

Substantial evidence regarding the control of the respondent over Shugg was submitted by both parties on the issue of whether Shugg was an agent or independent contractor, and instructions on the subject of control were given to the jury. The appellants contend that the jury was not informed as to the difference between the right of control and the actual exercise of control. In view of our conclusion that a real estate salesman is an agent of the broker, under whose license he operates as a matter of law, the question of control need not be discussed as instructions on that issue were not necessary in the present case. The important question is whether, at the time of the accident in question, Shugg, as such agent, was acting within the course and scope of his employment.

Were the Instructions and Rulings as to the Scope of Employment Erroneous?

The facts leading up to the accident appear to be undisputed. Shugg testified: that on the morning of the accident he was at the office of Davis Realty; that he left the office for the purpose of going to 38th Avenue and Clement Street to try to obtain a listing on a house at that corner on behalf of Davis Realty; that his sole intention upon leaving the office was to look at that property; that Davis Realty is located at [215 Cal. App. 2d 209] 14th Avenue and Geary Boulevard; that he drove north one block to Clement Street and then drove west on Clement; that as he started out on Clement Street he noticed it was around

9 noon, so he decided to stop by at his home for lunch and then continue out to look at the property after lunch; that he was driving west on Clement Street, somewhere between 14th and 26th Avenues when he made this decision; that he lived on 32nd Avenue, two blocks north of Clement Street; fn. 15 that the entire trip from Davis Realty to 38th Avenue and Clement Street would have involved a distance of about 21 blocks; that the respondent did not instruct its salesmen as to when or where they should eat lunch; that it was the usual practice to stop at a convenient location for lunch and then continue on with the business of Davis Realty; that he ate lunch at home if he happened to be in the area; that after he reached the decision to eat lunch at home he continued along Clement Street. fn. 16

[17] It is elementary that the liability of the principal or employer is predicated upon the fact of employment. [18] Accordingly, the principal or employer is not liable for the acts of his agent or employee while the latter is pursuing his own ends, even though the injury complained of could not have been committed without the facilities afforded to the agent or employee by his relation to his principal or employer. (Kish v. California State Automobile Assn., 190 Cal. 246, 248 [212 P. 27].) [19] Therefore, whether or not the principal or employer is responsible for the act of the agent or employee at the time of the injury depends upon whether the agent or employee was engaged at that time in the transaction of the business of his principal or employer, or whether he was engaged in an act which was done for his own personal convenience or accommodation and related to an end or purpose exclusively and individually his own. (Kish v. California State Automobile Assn., supra, pp. 248-249.) [20] Accordingly, it is the general rule that an employee on his way to lunch, even though he is driving an automobile which is the property of the master, is not engaged in furthering any end of the employer, and that therefore under such circumstances, the servant is not acting within [215 Cal. App. 2d 210] the scope of his employment. (Carnes v. Pacific Gas & Elec. Co., 21 Cal. App. 2d 568, 572 [69 P.2d 998, 70 P.2d 717]; Peccolo v. City of Los Angeles, 8 Cal. 2d 532, 535- 536 [66 P.2d 651]; Adams v. Tuxedo Land Co., 92 Cal. App. 266, 269-270 [267 P. 926]; Helm v. Bagley, 113 Cal. App. 602, 605 [298 P. 826]; Martinelli v. Stabnau, 11 Cal. App. 2d 38, 40 [58 P.2d 956].) [21] The so-called "lunch hour rule," enunciated by the foregoing cases, is, however, subject to an exception termed the "dual or combined purpose rule." The latter rule was stated thusly in Ryan v. Farrell, 208 Cal. 200 [280 P. 945]: "[W]here the servant is combining his own business with that of his master, or attending to both at substantially the same time, no nice inquiry will be made as to which business the servant was actually engaged in when a third person was injured; but the master will be held responsible, unless it clearly appears that the servant could not have been directly or indirectly serving his master." (P. 204.) This rule was followed and applied in Cain v. Marquez, 31 Cal. App. 2d 430, 441 [88 P.2d 200]; Loper v. Morrison, 23 Cal. 2d 600, 606 [145 P.2d 1]; and Fuller v. Chambers, 169 Cal. App. 2d 602, 608 [337 P.2d 848].

In Ryan, an automobile salesman made a trip from San Diego to Pacific Beach to interview a prospective purchaser and was making the return trip when he injured the plaintiff. It was there held that an employee who has gone upon an errand on behalf of his master does not cease to be acting in the course of his employment at the moment he starts upon the return trip after having performed the errand. The Cain case held that

10 there were facts sufficient to warrant the case going to the jury on the issue as to whether the employee was acting within the scope of his employment where the employee went home in his own car to get tools to be used in his employer's work, then went to dinner, and on his way back to work became involved in an accident. Loper, on its facts, is similar to the case at bench. There a milk route employee, Morrison, left his employer's place of business in his own (Morrison's) car for the purpose of collecting a delinquent account owed his employer by a Mrs. Hanson, a customer on his route. Morrison was accompanied by a fellow employee, Dolan, whom he had offered a ride home. Upon finding that Mrs. Hanson was not at home Morrison decided to call again later. While waiting for Mrs. Hanson to return, Morrison went with Dolan to a tavern near Dolan's home for sandwiches and beer, and then took Dolan home. While returning from [215 Cal. App. 2d 211] Dolan's home on his way to the Hanson home Morrison was involved in an accident. Dolan lived about 2 miles outside the area covered by the milk route and the accident occurred before Morrison reached the boundaries of his route. The court there held that it could not determine as a matter of law that the employee was outside the scope of his employment, the test being whether there had been a deviation so material or substantial as to constitute a complete departure, and that this determination was a question of fact. The Supreme Court went on to state that "[t]he employer's liability was not necessarily terminated by reason of the fact that Morrison combined a private purpose of his own with the business of his employer." (P. 606; citing the above rule announced in Ryan.) In Fuller an employee was driving a company car from San Francisco to Fresno on business. Instead of going by the most direct route, i.e., via Gilroy and Pacheco Pass, he detoured by way of Camp Roberts in Monterey County to pick up friends. The accident occurred after leaving Camp Roberts about 16 miles out of Lemoore (Kings County) along Route 41 toward Fresno. Applying the legal principle expressed in Ryan, the court held that there was sufficient evidence to support a finding that the employee was acting within the course and scope of his employment.

The "dual or combined purpose rule" was recognized also in Richards v. Metropolitan Life Ins. Co., 19 Cal. 2d 236 [120 P.2d 650]. There an insurance agent in the employ of Metropolitan Life Insurance Company used his own car in soliciting insurance, in delivering policies, in collecting premiums and in trips to the company's office. He paid all expenses of maintaining and operating said car. He was required by the company to attend daily meetings at its office in the morning. On the morning of the accident the employee was on his way from his home to the office of the company to attend a meeting of the agents and to deliver premiums collected on the day previous. Because his duties encompassed both office and field work in a territory allocated to him by the company, and because he had to attend daily meetings at the company's office and was required to deliver premiums at such office either before or after doing such field work, the Supreme Court held that there was substantial evidence before the trial court on the issue as to whether the agent was acting within the course of his employment at the time of the accident to warrant the denial of a motion for nonsuit.

[22] In the instant case it cannot be said that at the time [215 Cal. App. 2d 212] of the accident Shugg was engaged in an act which was done for his own personal convenience or accommodation and related to an end or purpose exclusively and individually his own.

11 The testimony shows that, initially, his sole intent was to attend to the business of his principal at 38th Avenue and Clement Street. En route, he decided to combine his business with that of Davis Realty. This is the extent of his deviation. Moreover, we do not even have a departure from the original route of travel as was the case in Cain, Loper and Fuller. The court below would, therefore, have been justified in giving an instruction based upon the legal principle declared in Ryan. Such an instruction was proposed by the appellants, fn. 17 but was not given. fn. 18 [23] Instead, after giving instructions defining generally the terms "principal" and "agent," the scope of an agent's authority, the meaning of "course and scope of employment" (including appellants' proposed instruction set out in footnote 18), and an instruction based upon the "return from an errand" principle (also declared in Ryan), the court below gave the following instruction: "An employee driving his own car to a meal may or may not be acting in the course and scope of his employment even though he is traveling with the intention of resuming his duties after eating. If the primary purpose of the trip is for the meal, then he is not in the course and scope of his employment. If the primary purpose is for the business of his employer, then he is within the course and scope of his employment." This instruction is clearly erroneous, and materially [215 Cal. App. 2d 213] at variance with the principle announced in Ryan. The rule in Ryan is not reduced to a determination of which business (i.e., his own or that of the master) is primary or dominant, or even as to which business the servant was actually engaged in at the time of the accident, but to whether, at such time, the servant is combining his own business with that of his master or attending to both at substantially the same time. [24] The essential inquiry, in each instance, is whether there has been a deviation so material or substantial as to constitute a complete departure from the agent's strict course of duty, and this determination is usually a question of fact. (Loper v. Morrison, supra, 23 Cal. 2d 600, 606-607; Fuller v. Chambers, supra, 169 Cal. App. 2d 602, 608-609; Westberg v. Willde, 14 Cal. 2d 360, 372-373 [94 P.2d 590].) [25] The applicable rule has been stated thusly: "One does not cease to be acting within the course of the master's employment because his most direct and immediate pursuit of the master's business is subject to necessary, usual or incidental personal acts, nor even by slight and immaterial delays or deflections from the most direct route for a personal or private purpose, the pursuit of the master's business continuing to be the controlling purpose. Such acts, not amounting to a turning aside completely from the master's business so as to be inconsistent with its pursuit, are often only what might be reasonably expected, to which, therefore, the master's assent may be fairly assumed; or they are in many instances the mingling with the pursuit of the master's business some purpose of the servant's own." (Shearman & Redfield on Negligence (6th ed) § 147a; cited with approval in Kruse v. White Brothers, 81 Cal. App. 86, 92-93 [253 P. 178]; Westberg v. Willde, supra, pp. 372-373; Fuller v. Chambers, supra, p. 608.)

The respondent asserts that even if the above instruction is erroneous, it is the result of invited error on the part of the appellants. Although the said instruction bears the notation that it was requested by the respondent, the respondent maintains that this instruction was not submitted by it, but was one prepared by the court, pursuant to the stipulation and agreement of the parties. The respondent has filed a motion herein seeking to augment the record to show that the said instruction was given by stipulation and agreement of the parties. The motion is supported by an affidavit of counsel for the

12 respondent to the effect that the subject instruction was a modification of an instruction submitted by it fn. 19 after a conference [215 Cal. App. 2d 214] in the chambers of the trial judge, during which both sides agreed and stipulated that the instruction in the form in which it was ultimately given would correctly state the law and be acceptable to both sides. The said affidavit states further that the said modified instruction was prepared by the clerk of the court at the direction of the judge. This latter assertion is supported by an affidavit executed by the said clerk and by the court reporter for the said trial judge. Counsel for appellants, in turn, has filed a counteraffidavit to the effect that it is true that the court did modify the respondent's said proposed instruction, after appellants objected to it, and that the trial court did direct either the clerk or the court reporter to type the proposed instruction as modified. Appellants' counsel denies, however, that he agreed or stipulated to the instruction as modified, and denies that he stipulated or agreed that it was a correct statement of the law. [26] We thus have a sharp conflict in the affidavits. In such a case we should resolve the conflicts against the party who challenges the action taken by the court below. Since all intendments are in favor of such action, we must give considerable weight to the designation by the court as appears in the reporter's transcript to the effect that the instruction in question was given at the request of the respondent. (See Cameron v. Cameron, 110 Cal. App. 2d 258, 261 [242 P.2d 408]; DeWit v. Glazier, 149 Cal. App. 2d 75, 81-82 [307 P.2d 1031].) The proposed instruction was an erroneous statement of the law. The instruction given, even if considered as a modification of the one proposed, did not cure the error. It appears, therefore, that the error was invited by the respondent, rather than by the appellants. Moreover, it would avail nothing to augment the record to reflect the notation requested by the respondent because this cause will have to be retried, in any event, in view of the other prejudicial error in the record.

[27] The appellants also assign as error the sustaining of an objection to the following question directed to Shugg: "And would you say it was only an incidental purpose when you decided to change your route to stop by your house and get something to eat?" The objection was sustained on the ground that it was for the jury to determine Shugg's primary purpose. The question was clearly objectionable because it called for the witness' conclusion. The extent and substantiality [215 Cal. App. 2d 215] of Shugg's deviation, if any, was a question of fact for the jury.

The respondent's motion to augment the record is denied. The judgment is reversed.

Bray, P. J., and Sullivan, J., concurred.

FN 1. Hereinafter referred to as appellants.

FN 2. Hereinafter referred to as respondent.

FN 3. In discussing such instructions and rulings we shall hereinafter refer to such facts in the record as shall be pertinent thereto.

13 FN 4. Other instructions were given by the court on the subject of burden of proof, as follows:

(a) "In Civil actions, and this is a Civil action, the party who asserts the affirmative of an issue must carry the burden of proving it. This means that if no evidence were given on either side of such issue, your findings as to it would have to be against that party. In determining whether the burden of proof has been sustained you will consider all of the evidence bearing upon the issue, regardless of which party introduced it."

(b) "In civil cases a preponderance of evidence is all that is required, and the burden rests upon one who asserts the affirmative of an issue to prove his allegations by a preponderance of evidence."

(c) "By a preponderance of evidence is meant such evidence as, when weighed with that opposed to it, has more convincing force, and from which it results that the greater probability is in favor of the party upon whom the burden of proof rests."

(d) "Preponderance of evidence means not the greater number of witnesses, but the greater weight, probability, quality and convincing effect of the evidence, and proof offered by the party holding the affirmative as compared with the opposing evidence."

(e) "Whenever, in these instructions, I state that the burden of proof rests upon a certain party to prove a certain allegation made by him, the meaning of such an instruction is this: That unless the truth of that allegation is proved by a preponderance of the evidence, you shall find that allegation to be not true."

FN 5. The questioned instruction followed the other instructions on burden of proof which we have set out in footnote 4.

FN 6. Greenleaf v. Pacific Tel. & Tel. Co., 43 Cal. App. 691 [185 P. 872]; Colbert v. Borland, 147 Cal. App. 2d 704 [306 P.2d 53]; Meschini v. Guy F. Atkinson Co., 160 Cal. App. 2d 609 [325 P.2d 213]; Banes v. Dunger, 181 Cal. App. 2d 276 [5 Cal. Rptr. 278]; Perrett v. Southern Pac. Co, 73 Cal. App. 2d 30 [165 P.2d 751].

FN 7. The said instruction read as follows:

" 'When the evidence is contradictory, the decision must be made according to the preponderance of evidence, by which is meant such evidence as, when weighed with that opposed to it, has more convincing force, and from which it results that the greater probability of truth lies therein. Should the conflicting evidence be evenly balanced in your minds, so that you are unable to say that the evidence on either side of the issue preponderates, then your finding must be against the party carrying the burden of proof, namely, the one who asserts the affirmative of the issue.' " (Pp. 165-166.)

FN 8. That is, to establish the defense of contributory negligence.

14 FN 9. This terminology appears in the instructions given by the court in the present case. See footnote 4, instructions (c) and (d).

FN 10. Mrs. McAnaw was an employee-secretary of respondent corporation.

FN 11. The proposed instruction was as follows:

"The designation of a party in a contract as an independent contractor is not conclusive. Although a contract is drawn with the purpose of creating the appearance of an independent contractor relationship, nevertheless the conduct of the parties to the contract may show that the true relationship between the parties was that of principal and agent. In considering the contract between Mr. Shugg and defendant, Davis Realty Company, you must consider not only the terms of the contract, but also the circumstances under which it was made and the conduct of the parties under the contract. If the true relationship between the parties was that of principal and agent, then Davis Realty Company could not avoid responsibility for the conduct of Mr. Shugg merely by providing in the contract that he was not an employee of the company."

FN 12. It appears to us, however, that the word "should" is preferable to the word "must" because the latter may be interpreted as signifying compulsion rather than the more appropriate idea of bounden duty.

FN 13. All section references herein relate to the Business and Professions Code unless otherwise noted.

FN 14. At the time pertinent to the instant case section 10132 read as follows:

"A real estate salesman within the meaning of this part is a natural person who, for a compensation or in expectation of a compensation, is employed by a licensed real estate broker to sell, or offer for sale, or to list, or to buy, or to offer to buy, or to negotiate the purchase or sale or exchange of real estate, or to solicit the prospective purchasers of real estate, or to solicit borrowers or lenders for or negotiate a loan on real estate, or to lease, or to negotiate the sale, purchase or exchange of leases, or offer to lease, rent or place for rent, any real estate, or improvements thereon." (This section read substantially the same when discussed by Grand v. Griesinger, 160 Cal. App. 2d 397, 405 [325 P.2d 475]. It should be noted that in 1961 this section was amended to provide that a salesman can do any of the acts which a real estate broker may do.)

FN 15. The contemplated detour for lunch thus involved a distance of two blocks from a direct route to his destination at 38th Avenue and Clement Street.

FN 16. The accident took place at 26th Avenue and Clement Street and prior to reaching his home or his ultimate destination.

FN 17. "The liability of a principal for the conduct of its agent is not necessarily terminated by the fact that the agent is combining a private purpose of his own with the business of

15 his principal. Where the agent is combining his own business with that of his principal, or is attending to both at substantially the same time, the principal is held responsible for the agent's conduct unless it clearly appears that the agent could not have been serving his principal directly or indirectly."

FN 18. The proposed instruction bears the judge's notation "Given as Modified," however, it was not given by the court. By this notation, the court apparently meant to indicate that the substance of this instruction was included in other instructions given. The following instruction submitted by the appellants was given: "When an agent is in truth acting on his principal's behalf and within the scope of his authority, if while so engaged, he also and incidentally attends to some matter strictly personal to himself, his doing so does not break the agency relation so as to release the principal from responsibility for the agent's conduct. On the other hand, when an agent departs from the business or service that has been assigned to him expressly or impliedly by his principal, and pursues some activity or object not for his principal and not reasonably embraced within his employment, but for the agent's own pleasure or purpose, the principal is not responsible for anything done or not done, in such activity."

FN 19. The proposed instruction No. 10 read as follows:

"An employee driving his own car to a meal is not acting in the course and scope of his employment even though he is traveling with the intention of resuming his duties after eating."

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(2): ib ad!i~1A andoompffw(~.tJtePdvactPt)liey tiiit ·~~- Wnliami p\\b~~m~ _ ~1o11m~ ·www~~~~.., ..an .f\ltlln,, _d'.W,itll ,*,,:,1erm~ .or~ -~ KellerWilli• p~6e!I &amt1;11tt ~~ eud torthe~~ Wlliia1ii5 to:~n:1¢ (3) to.-~•~~ Ctlmpltw1 ·~ ~u~ "\Villi~' ·pt~ollnes ~~ . 11rul ·"h· \,lfm ~· r)"'.(i) to' .the; ;....J~~o n. , ' ' ~'1l""'"~ ' . ' ' p and · 0~ . ' -~· . ot®i:iwl:l " ~ ' ' . tlllnlts ~ 'tl,at fV• .. ,• ' ' ' . . ~lay tbc·KolJ~ ,Willlmffi14emlilb ,orlogo,(b) ta the ~Jay and- of tho~t)' ' Wi,lUiws .oamea tndcmub andlogoon th"~ rdld(lll) 1(fthe uso ofm~ arid .•L...,dm 0~ - · ,ed tluU .-...-, Intetiiet . --.~ ....;;..;.;.'1. . . ~ _ett..t~e1to H+lt , .-s.ucb-wd>;;i.;... !!'WI', · ·

c. r;~ theenti:te ttm~thatAa~t~ w1tii tii~~t ~. ~~· to list allttai estntelutiriWi thatA~ttt·obtidtuand .to hlnd11l- altiooIestste ~UoMlii whleb. Agmt~sagesin tbe•e t)fK..8UJ:!ll WII.l'..lAMS JlBAi,TY. ),). Agent~ -n~tto d~an~g by 11Ct¼C112t '*1d~ Btiitement « autJelauf®thai ml$bt'~e thegoodwlU ~ -wllh ~et W,ilUema' n!Ufte-, ,blfeznia:b orrcputetlonor C$We 'thei,ub11i: io lose eonfldottce In lhe.KelletWtllJIIIN o~cm, . a... Autmlwill havtJ·no.authority, to incur ob.Iig.¢o.D$ _.onLl~'a t,ehalf -~ ~ ·~mr~Y -(1).notr:a cont11~ ~ che.~of~ a~!ia~ l¢ase.o~p~t¢ (2)MHo .DP,eft : .of~1~ lll11 .<3>:~ .*° endof.#·lbr C:t>tlecti4 _41)r_d~t .ln-ABe11~1 p~ any~eek. mOJtay aC(!()Wll .Ql'dar orot.fulr . neuotiabli> ~mt•e payat,le :«;Lloenw. 3,;: ,ca~, ••iiaffiiii&'Q(ll.'ql1ir,se -AIJot:,ilfon . ;· · A., f4tsolonga.s·AQc:ut•s ~IU(o'Q W-i~·d¢.~~ ~ ~, JIil~ ~ -fi'oi;tl,Aserit ~ ¥itJ~ 1a:~ .• ·~v,~~wilt~ ~.for fled lllsbutaed through th# Market C~tetin.111::C(J•~withKellerwntumr~Polldil$ ind-Gulclel~C:.. . JJ, :14~ wtiisbati:, ~ -~mmi'MTons-· eamoct ·.on tta1.estlfe ~olU' fu,Which AgentJtpJt$®lsa-MatbtCen1.et ~entast,uy~ :o,•~ :in ~ -wt~: thee«)~ . and_~~ _potltiea~t µ~~ o,~·-~ty to It~ ~~ ;~laies c,fthl llll~tting ~ -~ter. µ~,,.~t eo~oll spll~g and.cap~lrlgwU~es ate defiotibed in .1 ~oll\iaA~e~t. Agept-·~l~aes thatU~~ ~ soledJ~oti to Sc\1et;(ule •.Aaei:1t'1~m~.,~.wlllha payableonJy&omolbJienal ~ (2).~~ ~~ elfciri;pndo~n lh!blllty ~ .l':'~P ~,: ~ -~ -~ (3) ~~ .(-4)b~ cards,.yaM. ~' -~~ an~ o~et.~- ~'- (S) ~~ eosts;_~lub,tfues.tuid oiher ~= · ~ litrildMt ,,._._ WC f..a, .1t.w-,C(ll1\ tll : ~ : ~nQ,mof f\Wh,~ entMd Mafott.nanr~ · _..__L ,,h• .for attd (1) ~ w=~ .·~ •ti)··thaKd.l- .other'bimefltsof'.ussoQ~O;l,~ tJidJ~ ~ MerriCt1 .!~~$ad . _..,'tUti,I as an,~•tmt.(6)· Jsi~ .~te . J'f·~llll~tlllt;l~ ·(co~y~ by Xt:Ui':r .WUUahu .~ ~r I U~ ~n. ·,.._.:, _J.,.._, ;:;,;;,. and'~ "-•:-'-U-~ •'· . mid~? . .~riclpado~( ~11).(t()'OU , . . ~ -

pity ·uy ·ortl:ieieexplmSN tor;your :,e'itld d(ldj~ tiun;;ili• -~proprlaie.dderlp&i,;from Ln .tn3-,C.J E, Agent-~ .thatif Ageuido~ 11~ ptty ~ hrtietptitio11 .Fae$bffull wheu du~ QCM.1i-et may~ -ci anyunpiiditmountfromAgmt'seomm.wfoll:!. p. ~t .Wlll~"1:Ugibl~ ~ pattlei~m tha.'fWler Profit-~haru:lgprogrm W'dlililn.t u, tho..•e extent~ 911; .the·iwneterm$ 11.11otherKellerwm.l~ :~ . ~~ Atent un~ds ~ .a KellerWilUDmS m~ ¢anwtpiult ·~ ~flbtl,l~ Wo~.lt ·~tit~ .hi .'and.lhal die ProfitSbiomgprogra.'it _ptutJc.lffid!nt SIil~.·~ -~\1,$1mniun with1lieKeller WilliDmS~?fW ptriodt»r~ 'tlith'~f,its~t a_mltlirnurrt Vffl~ ·4, LlWt~Tiailftllittk.ti~o . For- ·rotia u A~~t ~ .ei~on -.With .tho-~~ ~~tln~ i ~t .has p~on ~ me theKF.UJ:ll WILLIAMS REAL TY ~Jljd h¥i'othei.yntd sie,u,);wimea lt>d•f...m ~ - letUibeail·ud: othetb~fd~ suh,!~.th.~~ ~~ ~ WUJl&iris' -ot"tf\o,iltWOzk tn1dtoxt. tt~ ·wiq -~ tqr·AgentfJ> :A H~w. . hav.e mtth!)WwW.ltw.eQffl. ~~ \rut. with~ ~ - ~"1qn ~ Kallar . WIQ~ -~ ~P~ \Yith .any paU~ i Utt pro~!I ~i ~ti Willltl!U' riAni~ impo~ Agenltnl)Yno.t ~ .tbit~It~ .WUllant.S ti,rloat, cu,-orht:~;4µ11~ ~e, .:~ .or~ Atenru~ wttbw!Hcb . web51~ -«. ~ ·any mtcrii~tii,d\r~lli~t P~ JOSY. ~ ·A,~f pl~ :When Omt.ertennbml~ hisoril)itt petl'4iUton. ,Aa~t's .~~ :KBLLER to,:iue 1he: -with: wn.t'iAM$ REALTY ~ ·namefUld 'lli' logoWilt.l.l?ll'O~di~ .O?*UY: :·~y ·ull'b~ ·r. that .~ -aitd;Ascntil2\tstfaunedllli~y ~a~ : AJent:with1he. ~~if .XellorW'dllami; and~mt ~ply~ -~~ wwt•• gutddin.. :andptO(;ed,,u·crre~g Wfflite.~b~~c,;,t o~~~\'1M<,lf~,Wlt,h l(jl,ltt .WlUlatrta' ~or,• ~ :ut£4 ~t.~ Vlliilllion.afthi, Km,.t:.e1t: ·\VIU,tAMSRRAl.Tf .~ Ol'' ~ ~tlon ~tlalj. In• tiom.tu:itaiu.~ .AP1i.twilrimmedlafll'l)I c;f1hednnwn-~ ·til WiUwna ICiiller. withoi.it COilip~,a.tinn. . s. E&O Uabillty ltmttau~ Ind~.1%udft~tfc111 A. Agent~ io obi!lnand PA)'fora.to lnsuratl~·cov~ errorsandomlmon, emfees• ~ ~A1i!II ffl.Otjate~f inQJ!limlto theproresslottlll l)l\Wldtis.AlffllwlU urrangofor Lfoei,seeIIQd·KellerWUllania n11.1ne~r to 1,,.,. hmuredsltt A-geu1 u n.dditl~n:n! 1 , &tO . I

f . ...

pofl~and.lb~ lmilnJ.ttto Jl?tivtde tb immtr1o .l'.J~ sudKtllt1 Wtlllm,11ot lm fu 30&ry,l~· w,tlcin,fibe-p:oU~·s CllJlclllletlon ~Jittn-itntW.;].

B. ri>tpwp~ . ers~omtc.~ ·.s~p~ ·in~ :.uUilbUity; ·"UabUitt* Qlatw. dmnages,lo~ oos1s·m~ .-ihit &Pfflf .~ ~,mt:u?$• ·s:~t ororin(:O,mecdoii with-aP#;ttfctitat -or rituadan. iilotdent . c.· If and'U) dle txtetit ·As~faiijicr~ Llc~ imclK~Ue .r Wi~ apt1ut· -~:ouinlY co~ bfUO ~ A.gent.~ risk# to h1denuu~aru1holdL\~ -lll:ld KelJerWilU~·hanfil~ fr6m··~ -~ d,lattJi;em~or1'ellet:Williams alllJafx1ii)i ~ - t>r~ on aocotin.tof.A!J#nt 1s bitentlOIJill di~ of btcacihof any law,reguhn!onor stmda:rdof C

t>, Fot -&b notcuatomiuity by E&Q.~S\lfatl'~ ·oo.vered _arldtot .t.t-.bUity 11:blnJ li'Qro·A~ent•t nea).le.eut (Uhln~ona» ·~prd or~ -oftQl)II.aw~ •ation or.atall.da(dof ~on~ ~~ qplies~ -1-e=t•a actio~ or KCUvhias'*'a llllCUSldJUI·esucesales~ Al¢11~~ ~ -lndm~ Md {M)ld Lf~ . aa~K!Jlle:r Willlaitt$}Wmlw fro~ iwl.agidnat ~ equali that ·,. ' · ta e of ru,y'LtabUit).' .thepmeatiifi'ofco~oM paya~to A ent-on ... ~!-~ ~oi~_~t -~~-o~-~~:.~ -~\'.~~e-~~ -~!!!lf .~ ~ .... · 8 ·· ·· 6, ~dtv~ Cts\tbUtallti.d Collil!len(taJ nifi,r-.'1iOm,, ' A. ·tU:el,u~ ..•plze, Ind.asr.ccr .thatA~ :tiuirJiit.~ -.~ .an'd)rofitt,i po~es ..~ -:thorelatfonsliJp•1 -~ori · drnf~M~ at J)'ei:$0iililJi -~ -~ -,~ :!s IQ®l'atca-Wlth ~ ·the~. ~ (~11~.v~J)' .of':Atjciit.that.,reet&tt4#to ~oflu ItwiJl-Jiti~:d\llbit·tbe~, ~fN1~·11 .;~~~ ~...Agb.tt~s~ ,c::6~~~yalliabt~.~- .~d~~ hlf'~t¢atl,~ :U~ -wlth1h!l pro~• :Mmt ·Cemcror .at sny.Iatert#ri;' ~t .io o~ ~ -:.~Jo,it,A~t·s n-.ti~~~~~•~,et to dop Agmt frtlmtaldng~ -(If hit As~nt~ ~ WhCJJ.lib :with .orher ~hitl~mhlp theMarket~ etuu: l3~ ~t. ~- ·1hit· Li~ and ~r -MadcctCenter ·aaentahavellpOSlt m1~.ia1 ~ti~~~ lll~ :t.o~,1~p.@ ~t l$am;~t fi,r Agdn•ilPa.tit,whloh -~ wstantirt ~ ·•4 .u t1(lt.co~ by~ ·S~bri- ti,B;tho~ .aem . ·~d pn:,fl1• of~~ -~ ~!"-boughtorso1dttal f.SUU! ~_ the.~t Cetlter and6f"Cliltl y,hg- iw &S$0ci~ with the .Matl(et·eet,tt:t comtitutc wl~le .busbii.m,i,.uets of tJ~ or other ~ ~ ~ ·MUUcd to p~cµt a.,~r:didenu,.t :~6u. ,Agentp~ 1hrit be.or tlho wi1I~t.,:dutul$~ tfm·e ·of Ageh1's.MJOdatton wi\h~ ~t ~nw-at · at -Y lltt,t.·~ dlYiitae.san. ~o or~~1&10 -io any~" exct111l .U~ othDrngems ~cl~ _with the · Mat'.ltot~ o~ wiili ntpnlziariontliaJd.l!!i1tides L~·, ar Jm)fites pe~ito~ b_tltb!: oraiiy:p~tm wh<> m~ at tlse Keller WUU.UU ho boughtOf ~ld -ieal estatethl®gh ;Matbt :Cetltor tlu.1 orof Mf Ii~ thal..U~ bu _~ltd .to;·ihe Markee~tet. Fujtlier~ Auiittprom!~~:uotiocitn.t¥,l~Y ltiob~uslp-~ifr-er qeut tlr to use·any·suebpro61~exupt in ~~nwith~,~~f~~M~~. 1NQRJ!l4tlMrcbtt(RAQMAMBMHNl ht1•4 -,

!

.. .,

1.- tu;m w ·"re~nd _on _ A. Aae:nt'$ ~Qn ~th Ui.t¥at~ Ceµ~~ -1:9~~ f'o,f-1\Ilinde1mlw. period,. Eiib~Ag~ _«:)t'U~ _lilay~te ~gent·;usoetstionWiUithe Marketee.i~ .t auy.thnej. wlthrprwithout·cit Useor prior:ootice, n. t~11 of~toi'a ~ittl _oil.'With thaMadcet ~ Wffl 1)1)~~ :;,ny -tfshts.rlt;obll&adam of tli~continuing or eitherA£tntot·LI~ u:nder ·thl!i_Agreem'tnf. w~ pai11mtlti:rty-tha in Secll~(i, c. ~ Agei:!lts~ati'oa ·wi~-ibe -~ . -~ ~fuj f~ my~ - ~ will wel~ -,ati~allowAgentto cab·atl sioli>"lirntJBS and buy« agencyCOtnraetB~ Agent~'It$ ~IW-,,lt fbrobtlµxu.,.1(AlCUt .~r ag~cy ttmhcts 'Wlthoaiet .tl\aretl·ll$tings eaeu~.bt ~ M~k#Ccn~,flilt'~ or~ ~~~will r@Wb withUte·~ -~w. btltAsentwiU~lv~bist>rherMt ~:«,ftM reJW!d com.om.don wheiuwa·oruu, pi'opelt1 closes. .p. Mu -~r$ a.w,dad.on ~~~s, u~ ·wfill.dieMmetC1?t11er MU tontfnue·w pa~-Agtllttsco~ona ·on~o~ .~etlons' fn-a,e~~ w;tfotb~ ci>nunlmon spfJ~~ln~w.Uel~ Umt awUedontl!~ d~ ofA~ ;:s1e~t16n. . _:E. If' A• . ow U~ _~y Pinfolpatlonf~- or.olbet liml:lunts: lit, the ~IIS Agent"s~t:tiati<»i.with tb~~ Cei\~1~ or if u,: amoun~beeclm.e duealtar ~on. ·.~ aittbodi.eiUeen,ee'to ~~ct ibeilnt®b.t-due. ffumanyCO~OUI ()f otlitir 11 a=olll'ii amounts.due-Agentu.btUAgtrnt whhUc~ lia!!beim.fullyprdd, 8. ~f#O!itltft,1• · A. r~Uct~ .~~ Agiml ~tints .(t) Ascat ·;i~4'1111ilccnRdu • ~ :-~ b~ktr pr sai~~n (a "It~ '&1ate~o~i wblthth~~ -~iU~ ii~~~ J\tu!ntla ht ibo.stato.tn l;illnUdy.a~JCJ~a Ji¼il 1?$Wis _~~Qnlll iri lkal ~ : ~~ .(l) Widbasn9tbc.mVTidun _tIsiWtt:1ow, A)lCti ~ la.st five~ a ~J . in Anytawmtal{egingll.~iesshmal rnbc:onduel or .vJol~ti~nof~ d~®e _1tade pni~cd~er llw.n~r ·piotl:ctloB is •tcuritntly ,ubJ~'tnmt·iQVdtlkatiori b)--,. teat~ ·«inunlssionoreomptllablett>Vendghtbodr. {3). Agent ::~p~ly Yc~js ~ -warmnt.t ·that Agent ls he lO~- Withth, M.a:ket~ 11t1d 1batAgentls not boundby a p~ ot CO~lment tot:ny otherrul ~ ~PMY• ogency.~attcm, ~ J)OtSOn 0t. ~on -thatpmhlbtts or ,pte.vents Alt@t~ ~chuliig wJtb.lho.Xe.I~ WUltama~d'oiJ. (4) ~ ~ptc:30n~vo. of· LI~= M IuUct WUliaiM bu -~ w.t . Agut din~ ·rw ~e busi1teitt.wh~ll¢r:'W11rir;h,j 11Uvµig~llin-'re,iddetttfaI part.time 1Nbf!PSND§N'CCQN18ACmBAPBISMIJ(r ,., . or !u$t¥o. ~~: that-the -1\g

g~ MJmllu~w fnjvMbllil A. _ rf MY)'.in:wJdoIJ: aA~ment faf'ouitdto M v.atdt>r un~le of.:thf by any ,I -courter arbltiati<.>npllie11the findtris. will~va no. ~ffwt r,in- any ath~ l)'ItMsionof 001 Agr«ment. fllldt1lltitherprov!dom( will tctnl\htIn Ml r~ Endefftct. )l . Tbb,~~ lnmudwa Schedule and.Onld~ thm l a.~ MYl'ollci'.el .~U~ WUHam; i~ C

(

~~· ::;- . . .·' . . . . . B ,· . . . . . . . . . . . . ,7!P"' ., . ' '

. .. . '·

. i

. - I

t ~f·. ! · .1 I

INDEPENDENTCONTRA.C-l'OR ·AGREEMENT ScllElJULE :l : !

·i

KELLER w:u:.tt,J,1S:ru?ALTYLakeT~visMnrltttCcJ11er {hcrclrt.itfter refen'ed.16!i 11Kciltt:Wlllwta'j ofibritb~ foltowingcommlssionsttu~tuct: · iI ! . . :to A&~nl!i .1Q%C'.()mnitsslollS _o!~t ~,QOO.OQO I ~0%to:~fer Wmiltit1s ~u~tl¢n (up 10 I I Sla.~OQcomp~yqoll$'$paid);10.0% to Aie,ttiuterS~OQO,QOO)m:>duction to_tnmissid,~ l,lJltil AJJ~t'SMXt wiver.sat,-·(asdewrminedby date AgentJoinedl(eJlerWilUams}-: 1· l • Th~igcm.'s Jo.hti_n deietmined _g gii;,ntl!Js thtt,mo@IAfi.erit :by_ tiisntml~ u~mffita,and I

receivesAgent'$l'R.l!C.9ril.e;mlan~s KellerWUU!Ul1$ Uccr1se.

OFFICEE10>ENSES; som.ri:busJnes-s expe• (i~~~onthlyCO.PY prlWie c::~lll',g~, ,l)fficerent,voi~l, -~ctiou f~; ¢m ·~~~~~:::~~~~~J~~tf oft'. . 10.set=~n~s,voii:'emlltl cantprivileges itrtdCO~)' wilt bt,tumed ' i . !

Onc.e~ 41genrhasrear:he,hhelr .cap~l~000.000 -·u d~rlbed ~,ie)., lheywnibc-b.Ultdi1$25.00. inprod1111liott i ; 1; t~otl.oh fee foreachttansnctlO#thatQleiffl,~ fbr.therem~ct ot1h11t~(~mry '/MltrAlsc>. Qlpp~y{"ft · i.

ogcnuiare~nsible for anyQftheir.Bu~r"sAg~~sand.Astlawnl'iJkllb, : · · '

tn_4il,e~n~·~m.~ partyfornrtj ~ --~nntmites .A..itenf sJnd~~"ni .c-o.n:craoto.r stanaWithKelterW!Ulf.m~ !'i. Aj~ritffl.ltlwrized<:eller- Williams.tu dedlielfiurnmits~dlng ~onunlulons,~l 11.1rtounu o\ffi:llit the .timeoft1,~ tc~tnationof thilagreement. Agcnla\$0authori:i,tKellerWilffams10d•t auamount$ ~ by agent •fter·sud\~ate,whentho~ amoun11 arem~um:d unbehalfof AgentbyKel~ Wntlams (ie.Al30RcllirJies, 1In~~en~dt71i). MY comsnis~tol.\ lnOOlnb~111le-seized WIUIIU'.ni by:JCcllct to sautif)rtn~rues owtd Keller WhUams ·\\-ill be t\lllyda~mtn~Qd nndJj:uUled ffle,. Copies ln Asent'$ b\d~di:111 Contt'ifetor otlhls ' i' dac:ument&tfon $hallbpsup~Uedup

--'--------4-~.~ .<:ro-7 .....;,...i.~r.,:.-4,1' ()iw). '! ··-,j

r;A':' \~I-.... 'i !

I V. Keller Williams Policies and Guidelines KELLERWILLIAMSQ

Revision 4/1 /15

Exhibit Witness -: ~ -~-=--ehm.i.---+- Date --r- - I lo KellyFisher,CSA Copyright~o 15 KallerWIiiiamsRoalty,fnc. Allrightsreservod. KellarWil!lamsRoalt),,Inc. Pollcl68e.GuldollnesManual,ReY. 4/1/16 Pages Market Center Must Update Tho foUowtngpages must ba updatedby each MarkelCentor.To updateaMpagesbul the Ethics,MnrkotCentersontor the appropriatevaluesIn the lndlcalednolds.The Code of Ethics should be printed by !ho Market Center and Inserted Into the Policies and Guidelines Manual where!ndlcnlod.

CommissionSpllts...........................................................................................................4-24 AdmlnlstmtlvaFoe for Capped Associate..... .. . . .... . .. .. . .. .. .. . ........................... 4-24 Markel Center Hours.................... ..................................................................................4-28 PersonalReal Estala{Buying,Sellingand Leaslng).......................... ............................ .4-29 UnpaidBR!s....................................................................... _...................,....................... .4~33 Insurance............................................. - .........................................................................-4-41 PersonalRoal Estate:Buying,SaUlngand Leasing .......................................................4-42 National Code of Elhlcs/Slandardsof Practlce................... ................. ........ ......... .G-1 Commission Polley of a MarketCenter ....................................................... ..................H-1 MlscellaneousPollcies & Fees of a Markel Center ......................................................... .1-1 Agency Polleyof a Markel Center ................................................................_..................J-1 Pollclesfor Teams and Groups of a Markel Center ..........,- ............................................K-1

380 Welcome to Keller Williams We are proud you havejoinedour llrm and we aro excitedto bo your partner In bu!ldlnGyour career Keller W lllams Roolly Inc. Ga c mpnny led by successfulpeoplo, for successful people which offers many opportunlliosfor career growth and development

Quite simply,the Koller W !Ramsgoal s to holp you build tho slrongesl real ostato business In your marko We want lo assoclotolnlerdependonllywith tho axcepllonalreal estato sales people In our Industry.

Whal makes Keller Wllllnmoun quo is our ocue;on who Is our ust mer nnd partner-you. This focalpoint sets the tone for everythingwo do, from how decisionsa o made, to our compensallonopportunlllae.Fvorythingaboul KeiferWilliams s un que becnuso lhe company s bu II around whatour assoclalosbelieve is beat for the r cnreers.We believe resultscome through people and that opportunties abound when careers are buIt on this phUosophlcal foundation We bellevo that ii lha oompany developslhe ndlv dual, thon the lndlvldualdovaJops tha company.

We nro more than a real estatecompany. WrJare a culture and a baliot syslern in action. We are REALTORS®who throughthe dally operationot our own successful company,dlscovered a better way of runn ng a raal estate company.We uncovereda helter way of life for ourselves and our asooclatcs,Our dollarsare Investedright beside yours-and wa are dedicated,1ustas you are, to providing thll best service to all buyers and seUers.

I encourage you to "talk the talk,walk tho walk, and Hvethe life" of the KellerWilliamsway or dolng business.Wo are commtttedto support. and help 10 assure, the professional~nd

381 -.-----·------·-·

Section 1 How to Use Your Manual Effectively designedfor yootln order lo work "Interdependently" 1nls manualhas baon spec!r"1enlly together wo must make sure everyoneunderstandsour poficlesand guldennes..

1.1 Definition of Interdependent "On the maluritycontinuum,dependenceIs the paradigmof you-you lake care of mo; you come throughfor me: you dldn1 come through for me; I blame you for lhe results. lndepondenceIs the paradigm ol l--1 can do it; I am responsible;I am self-rollant; I can choose. Interdependence is lho paradigm of ws--wa can do It; we can cooperate; we can combine our talenls and abUIUesand create something greater together." 1

1.2 About This Manual Your manualIs divided Into the followlngsections: • KeHerWIiiiamsStory and Phnosophy

KellerWHllamsbegan as one dream and Its success led to another.This section shareslhe beginningof the companyand its phUosophles.By studyingthis section you wlil become familiarwith our historyand philosophyand be able to share It and apply It to your own businoss.

• KenefWIUlamsBelief System In Actlon

KellerWtlltamsIs the result of an lnsp(redvision. The company!ncorporatosan lncomparabl0set ot beUefsfoundtn no other real estata oompany.With tho bollof systemsharedIn this section,KellerWIHlams showsit has eatabllshed Itsown vision and dlrectfonfor the future.

• KellarWIiiiamaPoHclesand Guldallnaa

KellerWUllamsIs l&d by associates,for our assoclatesl Evorypolicy and gUldcllnoin this manualhas been created and reviewedby our Assoclalo LoadershipCounctls (Local,Gfty,Regional,and lntemalional)and helps to insure professionalismand fairnessIn our company.Its numberone goal is to empowerus to develop matkot dominatingbusinesses. Our ALCwtllrr:,gularlyreview these pollcles and encourage you to learn thorn and share them proudlywith other associates, buyers and selers. Thesepolicles and guldellnesguaranteeall of us an lnterdependontorganizationof tremendouscrcaUvily,high standardsand elh!cs.

• KellerWIiiams Risk ManagementSystem

1 The 7 HabitsorHlghft Elfm;t/VflPeoplfJby StephBllR. Covey

KallerWJlliama RealtyInc.~ Pollcloa& GuldelneaManual,Rev.4/U15 Minimizingyour exposureto camplalnts and potentiallawsults through risk managa- monl la tho l

• KellarWHllornsOverviewof Costs to Associates

This sectiondiscussesyour possible businessoxponses. Most businessesfall, not because they don't maka enough money, but because thay spend too muchl Please alwaysremembarthis and Invest carefully when &pendingmoney on your business expenses.

• KellerWilliams RolorralProcedures

• KetlerWIiiiams RecognitionProgram

• Addonda

Realty,Inc. - Pollcloi;& GuldollneaManual, Rev. 4/1115 KollerWRllama Section 2 The Keller Williams Story and Philosophy Kelle WUHamsIs lhe result of an Inspiredv slon. Our talented learn of assoclaleswho created KallerWilllams were charged witha menumental goal: "Createthe Industry's finest nterdependentreal estate company."

2.1 The Keller Williams Story: A Convergence of Ideals Today more than any other llrne In real estate hlslory agent and broker goals seem to be diametricallyopposed. Real estate agents requiretheir cotnrnlsslonprogramslo be exceodlngfyhigh, yet brokers a e becomingmore and moro awnre that th s presents a truo profllabillly squoeze Twopeople can't save tile same doaar

2.1.1 Solving a Riddle Gary Koller and Joe Williams established KollarWUllamsIn 1983 as a lradlllonal real estate company.The firm had grown to ovar30 ossoclatesby 1986. Due to the pressuresfrom 100 percentconceple,they foundthemselves facadwith the above rnentlonedcommlsslon-profltabllltyparadox. Their lnlerdapcmdentapproachwas a creativeand toarn-orlentedresponse lo this riddle.

2.1.2 No CompromiseApproach Gary and Joe lnvited !hair associatesto n mealingwhere they outlinedthe commission· proflfablllty.squeezeparadoM;however, both brokerand associatedeterminedthat neither was wllUngto compromisetheir earning potential.The resulllng unanimoussolutlon combined tho best of all worlds with a progressiveapproach.Rather than compromiseassociate and broker goals the team Incorporatedthe two. The result-the ofllce grew to over 100 associatesIn less than flvo months. Faw would argue that the InventiveKell8f Wllllams programs they designedaro some of the biggestadvnneesIndustry-widefn broker-associate relationshipsand Incomeoppotlunltles.

2.1.3 Combiningthe Incompatible The deBlreto engineer a truly wln·wln companywith no limils on aasoclatecareer and income opportunitiesled the reasons rorthe change. The Keller WhllamsTearn discovered a way to championthe highest J]osslblecomml&Slonstructure within a fuMsuppart environment with expansiveprofit potentialsror I.hebroker and as&oclate.By doing so they created a method for combiningthe Incompatible-achieving both associateand broker career end Income goals.They then went one step further by advocatingthe conceptthat a commission program would be Justone fonn of compensationassociateswould have-not tho only one.

KollorWUffamsReally,Inc, Policies& GuldeflnesManuat,Rev. -4/1/15

384 2.1.4 Unexpected Demand The Keller WIOinmsSystem bacame l umph KellorW lllams associatesasked Iha firm to expand lhalr opportunties by oflerlng the system to brokers {n other cities. In fact, the first affllla1ebroker was brought In by a assocate. The San Antonio Market Center was so successful its first yoar they reco vod the r C mmber s rldo In Progress"a.wardfor bolng tho area's fastestgrowingn-ewbusiness. The reeulllngdemand ror \he KeRerWillfams Systemwas mexpeclodand as a result Keller WIiiiamsdid not emergeovernight.The enliro company is the result of a massive commllment It was a commitment rroma highlysuccessfulgroup of realestateassoclales and brokers. And it was a commitment of lime-tho time to develop Iha best, to reject any shortcoming and lo rethink, rado and continuouslyparlecl a system poltcy or program until it was right fot Keller WM11Brns and Its associates. After this extensivebenchmarkingand lrandtng developmente>cparlance, Keller Wlll!arns oreatod a new ovol of real oslata company.Your company!

2.2 The Keller Williams Philosophy If the companysucceaslullydovelops Its associates,then Usassociateswill nuccessfully develop the company.

2.2.1 An End to CompromiseBetween Broker and Associate What makes this task so stgnlllcant s tho reallzal!on that compromise Is lnherent in so many real estate companies, For lnslance, high commlsslonplans usually mean no support, no education and no team environtnent.Superiorsupport, oducatlonand loam envlronmanl usuallyloadto low commlselonplans.Neithercompromisecreates a wln-wlncompany. KeOorWnllatTisIslnlerdepondenllydesigned to put all of these compromisesto rest. Kelter WIYlamstncorporatosan Incomparableset of concepts found In no othor real estate (;ompany.

2.2.2 A Clear Mission Kellar Wllllams has developed a clear sense ol ils own vision and dtractlonfor the future. Keller WlfflamaIs a training and consultingcompany that also providesthe franchise systems, products and serviceswhich lead to productivityand pro11tnblllty . Ketler WUllamathinks llke a top producer,acts Ukea lralner/consullantand focuses anIts acllvltles on productMlyand profitability.

KellarWllllan1sRealty,lnc:. -Pollclea & GuldellnesManual,Rev.4/1/15

385 IV. lnstJrullonaland PromotionalMedia Advertising V. Relocation and Relorral VI, Ancllary BusinessOpportunllles VII. Recognition Vlll.Communlcauon IX. Marketing and Customer Programs X. Compensationand tncome Opportunities Throughthis process,KellerWilliamsturrnithe productsand sorvfcosrecommendation and quallly control prooassovor to Its nssoclnleRand affiliate brokers. The process provides markolpla.cofeedback and Iha dlroctlon neededto dGvelopeffective business loolawhen they're needed, It's part of the culture, Alwayshas been-always wlll ba.

2.2.9 World-ClassImage KeiferWilliams Really is one of tho most recognized brands in tho real estat8 Industry becauseof the education,training and technologyofferadto our asaoclntea.Howovcr, wllon It comes to local branding, the company strongly belleves that It Is the associates' brands that matter most. Building and malntalnlng a powerful, locally relevant brand Is tho most Important strategy for an associate. EvenU1eNationalAssnclatlonof REALTORS®has released research that proves that consumers do businesswith the real estate prolosslanal that they like and lrusl-not companies or big, haavlly-ndvorllsedbrands. An offloo, a Region and even KWAI, always take a back 5eat to the associa\e's brand

2.2.10 Tailor-Made Education KeberWlftlams Realty fs a tralnlng ru,d coaching company that also happens to be in the buslness of real estal8, Through its !faining division, KelterWIiiiams Unlvarslty;onllne portal, KW Connect,and Its coaching division, MAPS Coaching,KeNerWQllams associates have access to high quality education during every stage of their career. A brand new assoolata lo an experiencedmega a.ssoclatocan find Iha right training and coaching opportunities to propel the career to tho next level.

2.2.11 Local and Regional Contrarylo most, Keller W IIatns views he real estate Industryas a localand regional buslness. For th s reason,It has taken unprecedentedmeasures to design the nrmas u team of regionaloperat ons. In turri the goal of each Region Is to becomo n major regionalpower by bulld ng major real estate forces In local markets. This strategy endows our assor.lateswith the strongest possible support system In the tndtlslry,Everyonewins.

KellerWilliamsRealty,Inc. Pol!cles& Guk:leKnos Ma.nun~Rev -4/1115

386 _________________________ Pl¥fl.l!fHIIII 2.2.12 A True System In tho Markel Center, Kaller WIQlamshas created U1erndustry'sstrongestlong term economic;model time tested and proven.Thts was achieved only altor thoroughresamch and practicalexperience. For many years lhere WijfQonly tw11major real estato offlce economicmodels- traditionaland 1ooporcord-desk fee. After lnvastloatlngboth systemscarefully Keller WIiiiamsassociateschosa to take the bast from both.Toa resultwas a better win-win ec:onomlcmodol which fs a hybrid of Iha two. Our associatesreceive all of the supportadvantagesof ''traditional"while gaining more compensationadvantagesthan Justa ftdeskfee" concept. For tho broker It provides the lowes1financial tlsk operating system possiblewithin a full-supportcompany. The KellM WIiiiams economicand operating systemdeliverswhere othors fall short.

2.2.13 Get Involved • Attend [)rlcntatronand completelyread this manual. • Take part each week In the many oducatlonal,support and leadershipopportunllles availableto you. • GET OUT INTOTHE MARKETPLACE,BUILDYOUR OWN MARKETDOMINATING BUSINESSMEMORABLYAND HAVEHJNI Remember: Supportyour fellow associatesand team and they will support youl

KallerWIUlomsRealty,Inc.- Po11clos & GuidelinesManual,Rev. 4/l/15 ____________________________..lh§Mii- 4.9.1.11 Complaints/Disputes Involving Other Associates • Associateswho have camplalnts/dlsputasagainst othafs shouldltnmedlalelydtrect thom to their TL in writing. • These shouldnever ba discussedwith other associatesor cllonts.

4.9.1.12 Conduct • Alcohol Consumption Policy. We believe that ii Is unwls0to consume alcohol when working.Therefore,it ls a guide!ne of our companythat no memberof tha organ1zattonuso ak:ohoUcboveragesduringbusinesshours. No memberol our llrm should come to their office and/or MarkelCanter during businesshours, or ofr hours, wlth alcoholon their breath, or to any extent under Iha Influenceof alcohol.We con$ldorthis to be a strlcl guideUne. " Conduct at the Market Center. EveryoneIs to be well-behavedand professlona at tho MarketCenterat all Umee.This le an office where professionalbusinossIs being conductedand you should expect a business-Ilk.a altituda to be taken. We want everyooolo have respeotfor onch other In their daily pe,oonaldealings.Thera shouldbe no vulgar language,cursingor yelling. • Cocperallonwith Other Brokers. Pleasebe very cooporatlvewith other REALTORS$for thoy hold the keyto a great doal of nforma!lon. With theirhelp, you can becomevery successful.Wo cooperateand live by tho oplrltof cooperationwith all other REALTORS®and brokers.We do not, by any moans,wantto be arrogant and feel llko wo can do the Job by ouraBlves.We solicit lhe cooperattonol other REALTORS®at all times for the banofltof our clients. ll ls our policyto share informationwith other companiesond follow a prnctlc:eof lotal cooperation.This.,of course,does not mean the giving of confldontlal 1nrur111atlon,or any matters ol that naturo, bul does nvolve lnformallonconcerning propertiesthat ara avallableto aUREALTORS®who are InterestedIn doaHngwith our companyIn an open, above board manner.

4.9.1.13 Contracts 4.9.1.13. 1 Presentationto the Seller Eachcontractshould be presentedlo the seller In person, wllh a comp!etoSeller's Slatomentand a quanflcatfonsheet on tho buyer { f you ca,nobtaln one). • Contractpresentationsare to ba made n a professionalmanhflr and are to be dlstt.1ssed with tho owner reallzlngthat many Items other than moneygo into a contractoffer, For e)(ample,dale ol possessioncould be a determiningfactor. These are lhrngsthlll are discussed!n your trainingprogramand must bo consideredat each contract presentation. • The sellershoutd be given every opportunityto accept or reject a contractofter.

KallerWllllamsRealty,l11c. Pollcle11& GuldeUnes Man Ill Rev. 4/1/15 . 4-25 . r • r

4.9.1.14 Dress Polley II is lmporlantthat everyonewho associatesWithand ropresentsKellerWllllams Really do so In a proloBBlonalmanner.Associatesshouldconduct lhomsalvasproperlyin pubHc, keep ther,oar clean, drlvo courteouslyand maintaina wall-groomedappearance. Appearanco a tho single mo&tImportantlmpressfonfactoryou have. II is importantto bo well-groomedfrom a waU-kaplhatrslyledown to one's hoes. We are professionals;your manner and oppaarnncoshouldrot act this at elf times. This dress coda shouldInclude coming nto a MarketConlor on an associate'sday ort

4.9.1.15 Errors and Omissions (E&O) The E&O premium s determinedby the E&O prov def. Markel Centersmay havethe option to 1. Deduct MarketCanterasi.;oclateE&O tee from each side {llstlng or sales} through the DisbursementAuthor zaUon n t o WlnMORESystem.

2. BIii oach associatea Market Center aasocale &O fee monlhfythroughthe AccountEdgoAccountingProgram.

4,9.1.16 Equipment/Software

4.9.1.16,1 Copy Machine • Copy Machinewilt lnctudoa Code mochanlsm • A cost per copy will be paid by the assoclato.

4.9.1.16.2 Fax Machine • IncomingFax • OutgoingFax - cost por pago

4.9.1.16.3 Olher Equipment/Software whfchlhe ALC may approveto purchaseand which may be Other equlpmont/sottwa.ro In the MarketCantor. avo.llable • Digital camera • Colorcopier • Associatesoftware • Headsetsfor prospecll~ • Specialcomputers

4.9.1.17 Escrow Deposits • Time Is of the essencewhen deposillng earnest money/escrowchecks. • Escrowchecks shouldnever be held for any reason onca an offer has becomea contract.

KeiferWDl!amsRonity,Inc.- Policies& Guldelnes Manual, Rev.4/1115

389 • Al! escrow depositsshould be lmmedlatelyturned over to the titlecompany,or other entity named lo contract,for dapositor daposltodto tho Markel Cantorescrow accountlmmadlately

4.9.1.18 Keeplng In Contact with Your MarketCenter l

4.9.1.19 Legal Fee Polley Legal Fees wlll be split batwaenlhe companyand Iha assoclalo accordinglo the way the 0 commissionsplll was or would have bean on tha transacton.

4.9.1,2D Listings

4.9.1.20.1 Open/ExclusiveRightto Sell When we havo opao listings and/or oxclusiv.or ght to sell, wo shouldalways have notice In writing from tho ownerlhat we will definitelyreceive a commissionIf we procure a sale on lhal property.If weare not the procurng cause of the sale, then it Is not.necessary for us to have It In writng. Before we show any property or gJveany Information,we should have In writing lhal we WIiideflnltely bo pald a commission by the owner.

4.9.1,20.2 ContactwithSellers You should contact Iha seller of each of your listingsat Jeaslon<:ea week. This wlll keop the sailors abl'oaelof all tho markot activlly and any activ ty on their houses,One out of oach four cohtacls shouldbe In personlThis must be one or our strongestareas~never leaveour senarsstrandedI our reputation s bumon this guldellnol

4.9.1.20.3 Listing/SalesFlies There ls a roal necessityfor complo!o rocordalo bo kapt and rocordodso that records of transactionsbeing parliclpatadln by the companyand the company'sassociateswill be avaHable. All recordsthat haveto do with Hstlngs,appralsals,leasas,lhe hopsof obtaininglistings, contractsthat have gonethrough as wall as offers or contractslhal have laffenthrough are lo be kepi In o ma. Coplesof all letters, contract&and agreementspertalh!ngto real estate, regardlessof whelher theyare written by our associatesO!' others,shnnbe pl11eed In tho flla. This la the onlyprotectionyou and the companyhave In !he event of a !ewault.Full knowledgeof everycase ls Important. There Is no eXCUBBfor the vfolatloh ol this guidelineby anvaaaoclate.

KellerWIiiams Realty, Inc. Pollcle&& GuldeHnes Manuel Rev 4/1f15 4-27 ___________________________ 1-ri!iiMII- 4.9,1.20,4 Changes on Llstlngs It Is U1eassociate'&responslbllltyto make note of all chan[18Son his/her Psllngsln tho Market Centerllslfng Hllngs~tom and rn the MultipfeUsUngService(MLS). It the change Is ot a materialnature,tho UstlngassociateshoUldhavo wrlllen authorfzaUonfrom tho seller and put II In the property file for pennanentrecord. Any flnes Imposedby the MLS for Incorrector mlsslngtnfonnntlonare the rasponslbll!tyor the associate.

4.9.1.20.5 Listing Fomis It Is the responslbiltyof the fisting assoclatato obtain app oval from hls/horTL baroro submllllng a listJngto the MLS, It la our potlcy for you to providethe T withthe following Informationto obtain approval: • Completedliatlngform and worksheet • Completedllallng system form • lnltlaled saners statement This file shouldbo ln the Markel Center Ille cabinet and ln the Market Cante. Listing DisplayBookOI' Computer,before lhe llsllng s put on the listing board and lhe sign and lock box go up. We understandthis WIiialways take coordlnatlon,but without followlng thisprocedure,problemsalwaysoccur.

4.9.1.21 Market Center Hours Generally,our MarketCenteranro opon from lo.,--,,,--,--...,,,,.. Monday G vary lhroughFridayand---~ wllh local practices. to ____ Salurday and Sunday. Theso hours may

4.9.1.22 Market CenterTidiness Our Markel Centers ate to be kept noat nnd clean nl all limes. Each associateIs to make sure tho work areas are clean whenavar leaving the Market Canter. This Includesall areas, or areas-whicheveryone has common use of the Market Center. We hopoeveryonewill lake this attitudeand keop otJrMarkolCentersclean. You should be able to bring anyone Into the Markot Cenlor at any time and ba conffdon\you wm be proud of tho way It looks.

4.9.1.23 Negotiating Commissions

e In extremecases where the seller cannot complete a transactionwithout Iha give and take of all tho parties, you may nood to negotiatea commission.AHcomml&slon nogotiatlonsshould lnvolva you and your TL, If posslblo.Try not lo ever make a snap decisionon any commissionnegotlalfonrequest: time buys a position of strength In each nogotlatlon.The decl$lon ls ultlmatelyyours.

4.9.1.24 Personal Real Estate (Buying, Selllng, and Leasing) Purchasingor seNlngreal estate (your personal residenceor investment properties)la one of the greatest advantagesyou have as a real estate profoaalonal, and It ls our goal to preservethis advantaoe. i. The aBSocinleIs not requ red to pay the Market Center a real estate commissionon Ille portion of the transaction that lnvotvesthe associateas an owner.

KenorWIiiiamsReally,Inc PollolOG & Guldellnos Manual,Rev.4/1 15 4-28 a. This ptovlsion applies10thoso propertiesthat are consideredporsonalresldanca&and Is limitedto two s!defiper year, one as a Buyerand oua as a Seller. b. Each Markol Genierwill determinehow to treat personaltransactionsbeyondtwo sldos per yoar and thosepropertes classifiedas somethingotherthan personalresidencau. Each MarketCantorwlll also determne tequlrodcliterla to qualifyfor this "gill" NOTE: The associate Is required to pay royalty on ALL lransa.otlonsunlll the assoc ale fulf lls the KWRI royaltycap. 2. The associateIs requlrodto pay the Matket Center a real estatecommlss!oh on the side of the transactionthat Involvesanother associate.

3. It Is Market Centerpolicy lo charge the associatea minimallransacUonfee of __ _. (Check with the Marko! Contor TL.}

4. The associatemust pay the E&Olrlsurance if the E&Ocarrierdoes Insureassociate porsonaltransacUons.

5. Tho Malka! Center must havo a copy ol tha contract on lhe date It becomes etreclivo, as the Market Center Is legally llable.

6. All oxponsasInvolvedIn tho marketingof an assoclate'sreal estateshall be al the a~ociate's expense.

e 7. Certain rederal,state or provinciallaws and rostrictlons111ay propertiesand/orpersonalresidences. apply to Investment

a. Each associateshould obtain a copy of his or her local MarketCenterpoflcyto G determine If there Is a minimumcompany dolklr oontrlbuUoriwhich must be maintarnedbafore personalpropertiescan qualirywithoutpayingthe companya portion of the commission.

4.9,1,25 Phone Polley • All phonecalls should be returnedaa soon as po.sslble • All long distance calls are the responslblllty of and ere to be paid for bythe Associatesplac•ng or authorizing the call • Pollolesfor any Call CoordinatorSystemor any Phone OpportunityTbne System should be developedIn conjuncllonwlth lhe Local ALC

4.9.1.26 Priorities e It Is the consensusof Iha ALC that prlorltfsstor KellerWIUlamsRoaltyshouldalways be: 1. Sellingreal estate 2. Highest posslb'8commissionsplU.

3. Broker profit and a world class environmentand organization.

4. Profit sharingto assoefatesand the creationof a vestingtypoincome,not related to personalsalesproducton.

S. A producti\lityspecific anvironmenl

KalfarWllllo.msRealty,Inc. Policies& Guldellt11t11 Manual,Rov.4/1/15

392 • f

Addendum A Keller Williams Realty Profit Share Accounting Policies and Guidelines The followingarathe guldolinosused in ravlowlngKellar WllllarnsMarketCenter ;icc01.mtlogtepcrls:

A.1 Accounts Receivable All associatesare>to pay lhelr Markel Center b~Iby lhe end at eachmonthrosulllt1gIn a $0 (or credit) balanco.A $0 (or credit) AR balance occurs only whenall AR has boen paid In full. Tho MC may not forco a $0 AR balancethrough accountingru:ljustmsnts.The MC wHIoslabllshpollcleson lato offk:o bHlsand late Feeswhich could result In the returning of a roal estate ltcense.The MC will send demand letters vla cartlflodmall,"return receipt requested•,to all associateswith Invoices90 days or more past due, If stal unpaid, the MC wlUwrile off invoicesas Bad Debt Expense. Accounts Rece&vablobetween Market Centers are not allowed,Theseentries are In tho form of loans dcoumenteclwith a slgned note (fncludlngterms for lnlerest) OR paid In full by the end of lho month.

A.2 Auto Expense Should not excood$100 per month.

A.3 Cash Operating BankAccount signatures should lnoludothe TL and OperatingPrtnclpal only. It Is highly recommended1hatthe MCA not be on lhe signaturec."lrdbecauseof a nnt .. ntf .. l r.nl\111,..tr,f lnt,.riu:I nr IIAhllitv

393 VI. Listing Agreement ~, TF.x:As ASSOCIATION OF REALTORS® RESIDENTIAL REAL ESTATE LISTING AGREEMENT EXCLUSIVERIGHT TO SELL l/Sl!O,THISrORUBY P11111il0NSWtt0All6 N0f"~O,n!E'TIMS~110HOF ftl:AI.TONe a N:11'.MmlOfl2E). --lalolMoUTilll,O,lftt.11! 1•

1. PARTIES:The partiesto this agreement(thisListing)am:

Seiter. Ber.,., ,u,-4:lAM .•71Hf fu,<_

~~xf:!§~g: . a~, Clly,State, Zip: ~;r=-1~~~~41~, !ll~Jtt ~ r~st' .-='1 ~ ~J;ii± bt- Phone: _______________ Fax:_____________ _

E-Mail:------------------------------- Seller appoints Broker es .Seftel's sola and exclusive real estate agent and graots to Btoker the exclusive right to sell the Property. 2. PROPERTY:·Property" means the land, improvemenls,and accessories described below, except for any described exclU91ons. \;> 't A. ~e In ,~-:la ji4g,,=,bb::•- ......-n....,f=;s 11!),. AddJUon, County, Texas known ~-t' ~A ed on a m.)

B. lmproyemeQl&:The h0USC1, garage and all other flx1ureaand lmJ;)rovementsattached to !he above-describedreal Pfoperly, IncludingwHhoutUmita tion, the following permanentlyInstalledand bulll-tn llams,ff any: all equipment and appliances,valenc9s, screens, .shutters.awnings,'Nall-to-wallcarpeting,P!irron;.celling fans. attic fans, mall boxes, televlslon antennas and satellfte dish system and equlpmen'1mounts and brackets for televisions and Gpsakers,heatlna and alr-<:0ncitionlngunits, security and ffre detecUonequipment,Wiring.plumbing and llghtlng fixtures, chandeliers,water softener ays1em , kitchen equipment, garage door openen;, cleaning equipment, shrubbery, landscaping,outdoor cooking equipment, and aJIother propeny owned by Seller and attached to tha ~escribed reBlpn:,perty .

c. Accessot1es: The followingdescribedrelatedaccessories,If any: Windowair c0rw;t!Uonl119 unfta, stove, drep!ace !Creens, cut1alnsand rods, blinds, window shades,draperiesand rode, door keys, mailboxkeys, above11round poo~ swbnmlngpool equipmentand maintenanceaccessories,artificialfireplaceloge,and conlrofsfor: (0 satellite dish systems, (ii) garagedoors, (iii) entrygates,and (Iv)olher improvementsand accm,SQries. ~ - Puge, otto

Exhibit Witness > -=y;:::::a.:;-y~/- t1__t" __,JN!lle1MAe11.1.ud DEF 604 Date 1-~- l le Kelly Fisher, CSR OOIYIPfl'IAllon Brokltr11\aY • nx:elveunderthlll U8lli,g. •-•t•.., --4~--. _.._._ ....,.., to#Y\•t•• _., elU\,'IJM\111 IU Cr1J Ottltlf

f.l) QmgrEm AQd/Qc Bmhl/l:lfbftEmf'lflll: _________________ _

E Pmtftdklrt P,dod: (1) •Pfotocllonpatlod'"meanslhG1Um. 11111mng the day atw lhls llsdllO endsandconllnUl'lg 1or_/_Q ....... __ _ dl!l's "Sllr11111in •nr ttal!Sferof any IH i.lmplllm1eras1In thl>PIUl)lltywhe1tmby oralo, wrillaneurttmlfl( oropllon. {2) Not latllr than iO clay11 aher this Usllng ands, Bl'Cltlf may 1end Sell¥ writtennouc. spodlylng 11Ml'lll'llfl ti! pllflOIIS-..hOGIIallent!on W111S t:alltd to the Propel!)'Qllfng lhl, U.ling. II Seller agtHli IO 11111 1h9Propatty rJurlflo 1h11 p«llec:tlonJ:Jf)flodlit>• pu10n narnodIn Uw ncUc:e or IDa re!allv•cl a p11rson ruunadIn 11Jc11111lc., Seller~ pay Bloker,Upon \hlJclosingol the aaftt,the amountBroke( would~ been tmllllcl to recelveti thl&LbtiflgMre ail In efeet.

~Us*11co11C11nw,g ;;7105 ~,e- A,..lfe- Au<-h.-lX -z?7"~ D. &g\J§lgoa·~ f.oloWlngln,pn,ffl!lllnts a~aodes wMI b9 rellllnad by 9:1!1JAd m,,lt be~ar to de-:-!skVtt;·:.~~~tJA':uw~ .&1=£1£f!'i ~~ . I; Q 11 ~ not ~S:112!!.l&ur Toll pn.,peny aubjtct to mandllla,y merntlerihlp In • prvpl/l)' =ffl'

s. USTINGPRICE:sen«ln11nctaBrokerlo marbl 111•Propei,yat th• followin\lpnc,:, ________ _ {Ul1/noP11c1t). senorOQTIIISlo "" 1h11Prapmy !or u. U8dng Plfoe or anyother p,1c,eacc,peabl,10Sellar.Seller\IIIH pay Ill ~c;af ckl!lngJ:Qll:Icharged lo aelletsol mldentlal n,11mall! In 'f911U(r.aflar'11 lypic41clOSln;cmi. '" 111011 eel fol1hIn lt10Tllsldenllal co.-r.ictionns piomUlgehld~ IlleTuas RMI£,!AteCormnlcslon),

4, TERM:

A. ThiaUltlllg boglnlzan tf-«,e· f a2?/5vidand& Ill 11:59p.m. CII \ 'S",,,pf. I /).l)J>. B If S.llvr 11n11is lnla a biodlngwrlttaoi;:onlr:U:1la 1,alj lh• ~ btforeIlle date lllt8Udfng bHQln#-and 1heconlrac:t la ~nlifla an 1hed.ltt lhb Ustino bepis., !hit UStlngwil 11ot~no.. wtllbOvo111. 11111d 5. BROKER'SCOMflENSAllOtf:

A. When e;imec1 and poyablt, Sellft wll payBrokor. ,a{1}_-1,.4.,,...., ___ %oflheaaJoapr!t11. a (2)_ 8. !;am: when an)' one of 11wlolloTMg otOJtw !Ming-!his Llillng: &olett't campon,llllon Is e111111d (1) Selef selll, UChanOcs, oprior19,egn>ll5 to HO, llgl'IIDIlo l?llChall(llt,OI'agttllS Ill opUonIha Prl:ipllrly'10 811YOM at anyP'b oo llflY 11rmr. (2) Bn:ikarlnlivlduall)IorIn ccop1111!1«1 withIUIGthtrbtoktt procur.&a buyer 1111dy , wllRng,lmd lltlllllo bvy 11141 P!Vf)V!1yII tti. l.llltlngPrb or at '/llf'/ 0ll11rprice IIOlllpllil!e la Seier, Qt {3) Selk!rbttlcm lhlsUstlng. C. flmlll: Oncaeilffltd,Brokafsc.ompcnaallo!, IJ payab!Oefllltt duringlllb Uo!&!g01 aller It onds at theeatllerof: ft) .diec:IMlnQand ftmdn~ or anyaala01' exctiangi,ol llll or partof tne Property; (2) Sellar'arelulal to s.a lhe PfO!Jell)'afterSlollef1 campanutlonhi, bee" ea,ned; er t,J) StllDN bnlaeh Ill lhi11llstJIO; ('I II 1uch llme u olhel'WIMNI ltlr1nin this ll$tm9.

Ewket'aCOlllfltnAllonIll !!21. 114yableIf a cale ol Iha P,operty do4!Snot clole or lune!a• a ,e,ult QI: \I) Sellal'11 fallurll,wlllt®lfaut al Seier,t.od1Pver10a buy&rI dllodOf a lilltipoiq' as n,quiriadby !he C!Xllradlo $ell; (I) Jou ol llWNlr!Hpd111lo foroeloaUna « 011-.tleolllp,acee

o. Qlbln:Congns11100: Undma Cot)lad: If Sder callldl oom&11t (1) 8rpaqh by B!W:!I.[ mcney,11\Gsalaa pilce, or damagesby suit, campromlse,selllenHint,or a(/\arwllolrom II buyer who br~• • conlniC1l0t 11,e311Je ol lhlaProparty •l!Dm!Y'11HSand colfeellonaponses. 11ntoredmta dutlllg thlg Ullllng, S.U.r tNIIr,:rf Broker,1!1etdlldl.da'ICI

PAQe2ol10

DEF 605 Residential Listingc::oncGmlng

0 B. Setler lnswcts Broker not to file this Ustlng wllh one or more Multlple Listing Service {MLS) untn____ days after the dal9 this Llsllng begins fer the followingpurpose(&):_______________ _

(NOTE.Do not check If prohibitedby MultipleListingService(s).}

Cl C. Broker will not flle lhi& l.ls1ingwilh a Multiple Ustlng Service (Ml.SJor any other llstlng service.

~: Seller acknowl~ and 1.1nders1ands that if thlGopdon Is checked: (1) Seller's Propertywill not be IncludedIn 1heMLS databasea.vallabla10real eslala agents and brokefSfrom other real estale offices.w,,o subscribeto and.pa,1icis,atein the MLS, and their buyer cllenm may not ba awarethat Seller's P1'0f*1i, $ offered for sale; (2) Sellefs Prcperty wflI not ba included In 1he MLS's download to various real estate lnlemet sfte, that are used by the pubMcto search far property llstings; and {3} real estate agents, brokers, and members of lhe pubtlc mil)' be unawareof the terms and conditions under which Seller Is maritetlng:the Property. 7. ACCESSTO THE PROPERTY:

A. Autt}QrlzjogMSQS§:AuthoriZingaccess lo the Propertymeansgiving pem,isslonto another panion to enterthe Property, dlscloslng to the other person any &eeurilycodes necessary lo enter the Property,and lending a lceyto the other person to enter the Property, dlrectly or through a keybox To facilltate 1h& showing and sale of lhe Property,SellerlnslruclsBrokerto: (1) access the Propertyal reasonablelimes; (2) authorizs other brokers, their associates, inspectors, appraisers, and contractors to access the Property al reasonabletimes; and (3} duplicatekeys 1ofacllllale convenientand 4:!lrlclent showingsor the Property.

B. §ehegygpgCompanies:Broker may engagethe following companiesto schedul&appointmentsand to authori28 others to accessthe Property:________________________ _

C. ~: A keybox Is a looked contalnet placed on the Property that holds a key to the Property. A keybox makes ft more convenient for brokers, theit associates, Inspector&, appralsera, and contractors to ahow, °" Inspect, n:parrthe Property. The keytlcax11openedby a speclal camblnatlon, kay,or programmeddevk:e so that authorized persons may enter the Property. even In Seller's abRnoe. Using a keybox wlR probably tni;rease the number of sbow[ngs. but lnvolvff rbka (IOrexample, unauthOrizedenlrY, lhefl, property d;una.ge,or personallnJury). Nelther the Assodatfon of REALTORS® nor MLS requires1heuse at a keybox.

(1) Broker ~ 0 Is not author1Zad to pface a keyboxon ths Property.

(2) If a tenant OCCtlplesthe Property at any time during this Listing. Seller will furnish Broker a written statement (forexample,TAR No. 1411). ilgned by antenants, authodzlngthe use of a keyboxor Brolter ml'lyremovethe keyboxfromthe Propeny.

D. Uablllty and lndemaificatlon: When authorizingaccessto the Property,Broker,other brokers,theira880Qates, any keyboxprovider, or anyschaduHnQ oompanyanJ not responsiblefor personalinjuryor propertyloss to Selleror any other person.Sellef assumesal risk of any lo5s, damage,or injury.Except for'a..loss caused by Braker, SeUer wm Indemnify1nd hold Broker harmless 1r.omany clalm for personallnfury.propertydamage.or other loss. 8. COOPERAllON WITH OTHER BROKERS: Brakerwill allow other brokers to show the Property to prospec1iVebuyers. Broker winoffer to pay the 0Ihsr broker a fee as describedbelow If the other broker procurvs a buyer that purchases the Propeny.

fTAR·1101) 01•01·14 fnltlaledfar ld•n1HlcaUon by Br0ker/Assocl4te ~ andSeller--4, ~ Page-I ol 10

P'nldur.ldwllh~by~bo. 1801'0l'lllMII llUeRcad.l'dlw, ~4aozt ......, Jlplpqh

DEF 606 A. ML6,Participants r lhe other broker Is a partlcJpantIn 1heMLS In which this Listing i! 1lled,Brokerw1Doffer to pay 4 ,L theotherbroker: (1) Ifthe other broket r&presantsthe buyer. (2)If tho other broker Is a subagent ____ ,J~ % orthe sales price or$ ________ %of the salesprice or$ _______ _ , al'ld

fJr.okers. B. Non-MLS Hthe oth81' ln theMLSInwhichthisListingIsfiled,Brok&r brokerIs nota panlcipant willofferlo pay the other broker "'?en_ {1} it the 01herbroker reprassn~ 1hebuyer: , ~ % of the sales price or S ________ ; and (2) ii the other broker ls a subs.gent' ____ ,ii of the salespriceor$ _______ _

(CheckA or B only.) ~. ltffERMEDIARY:

~ lnte[!!Jed!arvSt;!WS,Broker may show the Property to ln1emstedprospectivebuyer&who Broker represents. If a J)fospectlvebuyer who Brol(er represents offers to buy the Ptoperty, Seller authorizes BrokertD act as an Intermediaryand Broker wil notify Seller that BrokerwlU$8rvloethe parties In accordanto with one 01 the loQowlng allematlves. (1) If a prospective bUyerwho Broker represents is nrvlced by an 8S$0clate other than lhe associate &ervfcing Seller under lhls Listing, Broker may notify Seller Iha! Broker Win:(e) appoint the associale1henservicingSaller to communicatewfth,carry out lnstn.Jdionsof, and provide opinions and advice ck.IringnegotlatlonsIO Seller and {b) appoint 1he esscclate thel'l servicing the prospective buyer lo the prOJ1pectlve buyer for lhe same PLlfPCIS& (2) It a prosped'r1ebuyer who Broker represents ls servlcedby the same associatewho Is servicing Seller, Broker may notify Seller lha1 Brokerwill. (a) appolnl another assoc:iateto communicatewilh, car,y out lnslrUclionsof, and provideoplntons and advice during negC111atlons to the prospectivebuyer; and (b) appoint the associate servicingthe Saner underttis llsUng lo the Seller for the same purpose.

(3) Broker may notify Seller that Broker will make oo appointmentsas desctibad under this Paragraph9A and, In such an event, the aasocJateservicing lhe parties wil act so ety as Broker's ln1elTTledlaty representallva,who may faclllt.atelhe lransactlonbut wfllnol renderoploionaor adviceduring negoUatlon& to either par1y

D B. Nol(lf&lrmadlao: SJitusSeller agrees that Brok11rwillnet show !he Property to ptospectlvebuyers who Broker represents.

Notk:e: If Broker acts as an Intermediaryunder Paragreph 9A. Brobr and Braker's asaocfotea: • may not disclose to the prospective buyer that sanerwill eccept a price IDISSthan the aklng prioe unless otherwise Instructed In a separate writing by Seiter, • may not disclose to Seller that the prospective btlygr wm pay a price greater than thit price submitted In a written offer 1D Seller unless otherwise tnstructed In a sepanafawrltlng by the ptospective buyer; • may not disclose any conftdenllal lnformati® or any rnformatfon SeHer or the prospective buyer speoiffcally instruc.ls Broker ln wrtllng not 10 dlaclose unless otherwise lnslruoted In II separate writing by lhe respecdve party or requJred lo dtsclosa the Information by the Real Estate Ucensa Act or a court order or ff the information materiallyrelatesto 1hecondlllon of the property; • may nOltreat a party to the lransacUondlshonntly: and • may not violate the RealEstateUcense AcL

(TNM101)01--01-14 .........

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DEF 607 Recfr:lentlal Ll!illng concerning

10. CONFtl>ENTIAL INFORMATION: During this Uatlng er after it ends, Broker may not l

11. BROKER'S AUTHORITY:

A. BrokerwfHuse reasonableeffortsand act dlllgen1ly10 marketthe Propertyfor sale, procurea buyer, ar,d negodate the sale of vie P,operty.

unlessone of lhe followingis checked: B. BrokerIs authoriu!dto displaythis Listing on lhe InternetwithoutDm!latfon

0 (1) Seller does not wanl 1hlsUsdngto be dlsplayedon the ln1amal. 0 {2) St:tllerd~ not want the addrBss of~ Property to be displayedon the lnlemeL

NoUce: Selh,r understand& and •cknowledgas that, If box 11B{1) Is seJoctcd. c:onaurners who conduct se;srches far listings on lhe lntemetwl1fnot see lnfolffl8tfonabout this Listing In response10their search.

J C. Brokeris authorizedto marl

l1) Conventional O (5) Texas VeteransLand Program {2) VA O (6) Owner Financing (3) FHA O (7) Other (4) Cash

D. rnadditionlo other authoritygrantedby this Ustlng,Brokermay: (1) adVertisethe Property by means and methodsaa Broker detemdnn, includingbut not Hmlledto ~affng and pfadngadvertisements Imagesorthe Propertyand with lntarlorand exteriorphotographicand audfo-vlsual related InformationIn any mediaand Iha lnlBmel; (2} place a ·For saJe• sign on lh& Propertyand ramovaall olhEII'signsofferingthe Propertyfor ~le or lea~; (3) fumiffl comparalive marketing and salH Informationabo!Jt other properties to pmspecthlebuyers; (4) dlssemilale lnfonna.tronabout the Propertyto other brokers and to prospecttvebuyers, Including appllcable disclosuresor noticesthat SeU•rIs requiredto makeunderlaw or a contract; (5) obtainInformationfrom any ~Idec of a noltt securedby a Henon the Property; '°' {6) acceptand depositearnestmoneyin trust In accordancewitha contract the safeof the Property: (7) disclosethe sales price and terms of sale to otherbrokers,appraisers,or ether real es!uleprofessionals; (8) In re$Cnse to lr-iubies from prospectivebuyersand other brokers,dfsclo$ewhetherthe Saller 1$considering more than one otter (BrokarWIiinot dlsctosethe lerms of any compellngoffer unlesss~omcanyinstructedby Seller); (9) advertise.duringor aner this Us11ngenda,that Broker·sold'"the Property;and (101ptace lntormationabou1 lhls Usling, the Property, and a transaction for the Property on an electronic transacffonplatform(1yplcallyan Internet-baaedsystem where professionalsrelated lo Iha ttansac!lon 8UChas lf11ecompanies,lenders,and olhers may receive,view, and Input Information).

E. Broker Is nDIauthorizedto executeany documentIn Iha nameoror on t»helf of Sellarconcerningthe Property.

(TAR·1f01)01..0M4 lnillaledklf"ldenlillcallonbyBroker/A$$oclata ~ and Seller~~ Page6of 10

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DEF 608 12. SELLER'S REPRESENTATIONS: Except u provided by Paregmph 1S, Seier rupresen1s thal: A. Solfar has fee simple title to snd peaceabl6possessionof the Property and all l1s Improvementsand fi,ctures, unles$rented,and the legalcapadly to conveyth&Pfoperty; B. SellerIs not boundby a liattngagreementwith al'\Otherbrokerlor the sale, exchange,or lease of the Propertythat Is or wlObit In effectdullng thisUSting; C. any poot or spa and any required enclosures, rencaa,gates, and latches comply wllh all awffcable laws and ordfnancas: 0. no personor entityhas any right to purcliase, lease1 or ai:qu\rathe Propertyby an option,right ol refusal,or other agreement; e. S&UetIs currentand not delinquenton all loans and anotherfinancialoblfgalfcms1'91ated to tha Property,lncludlng but not Rmltadto mortgages, home equity loans, home Improvementloans, homeowneraasoclatlonfees, and laxes.except ~- _ ; F. SellerIs not awareof any lfens_9r pthm encumbrancesagal t the Prep rty, ex pt ________ _ ,1'ltf)l'C,.,f-, - Is not subjectIOIhaJ di n of any COUtt; G. lhe Pr<>perty H. all Jnlormallonrelatlng to the Propeny Seller provides to Broker ls !rue and corrac.tto the best e>fSollar's knowledge;and I. lh9 name of any employer,relocationc;ompany,or olher entJtythat provides benefits lo Seller when Ballingthe PropertyIs; -- 13. SELLER'SAODrTIONALPROMlSES:Selleragreesto: A COOl)erate with Brokerta facllltale1heshowing,marketing,and sale of the Property: B. notrentor lease the Propertydurlng1hfsListingwlthovtBroker'spriorwrittenapproval; C. not negotiatewith any pn:i8f)ecttve buyer who may contactSellerdlnictly. but refer al prospectivebuyersto Broker; D. oot enter into a listing agreefl'lentwl1hanotherbrokerfor the sale, exchange,lease,or managementof the Property to becomeetfect!VO duringthis Usllng

14. LIMITATIONOF UABIUTY;

Senormust nOlllySeller'scasualfyblsurancecompanyand A. If the Propertyis or becomesv.acantduring1hisU&1fng, requesta "vacancy0!11use· for the aacurltyof the Propertynor ror to coYerthe Property.BrokerIs not responr;lblG inspecilngthe Propertyon anyperlodlcbasis,

B. BrokerIa not responsibleor liable In any mannerfor personalln]vry 10any person or ror lose or damageto any person's real or persona.Iproperty resulting rrom any act or omission not ®U* by Broker's nagllgence.,Including but not llmftedto lnJurJasar damages caused by: (1) other brokers, their aasoclatd, Inspectors, appraisers, and contractors who are aulhotl.ied to access th• Property; (2) other brokers or thefr 8&90Clalss who may have lnfarmaUon about the Property on their websites; (3) acts of third parties (for example, vandaHsm or theft); (4) freR!ng water pipes; (5) 1 dangerous condition on lhe Prgperty; (6) the Propertyta non•compllance 'Withany Jawor ordinance; or (7) seller, neallgently or otherwl$e.

(l"AR-1101)01-01·1' .,. .... ,., khnllfl-n

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DEF 609 ResldendalL1stiiY;J conceming ':k.:--zoS-C4 est A4-e b-6 n¥ ::Jl?--i-a.)_ C. Seller agrees to prolecl, defend, lndamnlfyt and hold Broker harmleas from eny damage, costs, attorney's feea, and expenses that ; (1) are caused by Seller, negllgently or other.vise; (2} arise from seller's raHure to disclose any material or relevant lnfonnatfon about the Property; or (3) are cau98d by Seiter giving lncorrecl Information to any peraon.

15. SPEQAL PROVISIONS:

16. DEFAULT:ff Sellerbreachesthis Lls1fng, Selleris In defaultand wlUb& Ila.bk!lo Broker101" the amoumof \he Broker'a compensationspeclffadIn Paragraph5A and any other oompensationBmker Is eolll11:1d to recatveunder this U$1ing.JI a sales price Is not determfnable!ti the event of an exchangeor brt!!aeh of ttils Ustlng, lhe Listing Price wlll be tha sale! price for purposesof ccmputfngcompensation.If Brokerbreachesltlls Listing,Broker Is ln default and Seller may axeroiseany remedyal law.

17. MEDIATION: The parties agrea to negotrataIn gocd faith In an effort to resolve any dispute relacedto this listing that may arise between lhe parties. If the dispute cannot bG tesolved by negottallon, the dispute will be aubmltted to mediation.The pal"llesto the dispute will ch00$8 a mutuallyacceptable tnadlatorand wlll share 1he cost of medfat10n equally.

18. AlTDRNEY'S FEES: H Seller or Broker Is a prevailing party In any legal proceedingbrought es a reautt of a dispute underlhls lislfng or any transactionrataledto or 00ntemplatedby this LlsUng,such party wlRbe entitledto recoverfrom the l'IOn-prevamng party al costsorsuch proceedingand reasonableattomey·sfee8.

19. ADDENDAANO OTHERDOCUMENTS;Addenda thatare part of this Usting and other documentsthat Seller may needto provfdeare: !ILA. InformationAbout BtOkarageServices; J.!JB. SeiterDisclosureNotice (§5.ooa, Texsa PropertyCode): 0 C. Addendum for Sefler's Dfaclosureof fnkmnatlonon Lead-BasedPaint and Lead·BasedPaint Hazards (reqUlradif Propertywas built belOl'8"1978): D9D AesldentlalReal PropertyAffidavit (T-47 Alflda'Jit;related10existing sumy}; D fi MUD,WaterDistrict,or StatutoryTax District OisclOSUTeNotice (Chapter49, Texas Water Code): 0 F. Requestfor Informationfrom an Owners'Association; Cl G. Aequei.tfor MortgagelnfonnaUon; · Q H. Informationabout MineralClausesIn CcmlraatForms; 0 I. lnformallon about On-Site SewerFacility; D J. lnfcrmaUonaboutPropertyInsurancefor a &ayer or Seller; •

! 0 K. lnfomta1ionabout SpecialFloodHazardAreas: L Condomlntum Addendumto Listing; M. KeyboxAuthorizationby Tenant: N. Seller'sAumorlzationto Releaseand Adwrtlse Certalnlnrormatlon;and 0 0. -------------------------------

O'AR-1101)01·0H4 lnhialedfor ldent111ca11Dn by Brokett~odall!t~ andSeller -4?!/.L Page 8~f 10

~lillb ~11, ~ 1ll070FillllenMll8Ho:l!I.Frue,, t.khlQM4a0:2ill pw,z*'&mlJ.calll!

DEF 610 Resident/a.I Llsling concamin9 '5:° CN4:11-ve d?ro... 20. AGREEMENT OF PARTIES:

A. EntireAgre§ment; This Llsllng Is the entire agreementof Cheparties and maynot be changedexcept by written agreement. B. Ass!gnablity: Neitherpatty may assignthis llstlng ~llhoutthe Writlenconsentof the oth81'party.

C. Binding Effect:S&ller'sobllgalion10 pay Brokeran earnedcompensationIs bindingupon Sellerand Sel}e(s heirs, administrators,executors,suc.C8S1K>rs, andpermittedassignees.

D. Joint aooSeveral:All Sellen, executingthis Listing are Jointlyand severallyHablefor ihe pertonnanceof all Its terms.

E. Goyem;ngLaw:Texas law governsUls lnte,pmtatJon,vandlty,perioflnance, and enforcementof this Listing.

F. Severablll~:If a court finds any c:la1JSe In this LbUnglnvaltclor unenforceabkt,lh&Jremainderot 1hlaUsUng wlUnot be affectedand all otherprovlalonsof thislisting will remainvalid and enforcaable.

G. ~ NoUcesbetween Iha parties roost be In wriUngand are effeellve when sent kl lh& recefvfngparty's address,fax, or e-mailaddressspecifiedIn Paragraph1.

21, AOOTflONAL NOTICES:

A. Broker's «wnpensallon or the shartng of compensation between brokers ls not fixed. controlred, recommended, $Uggested,or maintained by the Associationof REALTORS®, MLS,or any IJS11ng aervlce.. B. In accordance wfth fair housing Jaws and the Natlonal AssocJation of REALTORS8 Code of Ethics, Broker's services must be pl'01'ided and the Property mvst ba shown and made available to all persons wnhaut regard to rac&,color, religion, natJonal origin, sex, dlaabBlty. lamllial status, sexual orientation, or gendor Identity. Local crdlnencas may provide for aiddlUonaJprotlleted classes (1or example. creed. S1att.tsas a student, marital atatos, or age).

C. Broker advises Setler to contact any mortgage render or other nenholder to obtain Information regarding payoff amounts for any existing mortgagH or liens on lhe Prope!1y.

D. Broker actvla&sSeller to review the Information Broker submits to an MtS or other Ustlng service. E. Broker advises Seller to remove or secure Jewelry,prescription drugs, other valuables. Hmarms and any otherweapons. F. Sfa1'11asor Ol'dlnances may regulate eartaln Hems on the Property (for example, sw(mrnlng pools and septic systems). Non-compliance wHh the statutes or ordinances may delay a transaction and may result In llnes, penalties, and llabntty to Seiter.

G. ft 1he Property was bulft before 19781 Federal law requlles the Seller ta: (1) provide the buyer wHh the federally approved pamphlet on lead poisoning prevontlom (2) dfscloae the presence of any known lead-based patnt or lead-baMd paJnt hazards '" 1he Property; (3) deliver ,n recr:ards and rapol'b to the buyer related to such palnt or hazards; and (4) provide lhe buyer a period up to 10 days fD have lbe Property Inspected for such paJnt or hazards,

(TAR-1101)01-01-14 1-od~r ,__ by_od_ ... ~andSeBa,-4-7.iJ£.. Page 9 of 10

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JOJ~&\WJd

DEF 611 Ae,lden!lal Ustlng concerning

H. Brobr cannot give legal advrc:a. READ THIS LISTING CAFU!PUU. Y. If you do not understand th• effect of this U&tlng, oonsult an attorney BEFORE signing.

Sellttr'sSlgnatura

(T~1101}01-01-14 lniliaJedforldanllflcadonbyBrollai~seller Q~ Page1oof10

DEF 612 VII. Police Report l,lillt;'-Erit.,u,tiimratm•J l d)()l u... CJ.Lv D FAT'-1.. or;,...,D ~c«0<::1.tiv5 o ~AlUIO:.O u M1,e lXlSVPM.c, 1e1n o tt!'6&. .:o•H!

152181102 AUSTIN

I I I I I' 1 I I l I

~;i$l i...-. l.34 BURGRSS LANI!: AUSTIN, TX 78138 t;q,. St.119, ZIPI .. t: oiw...It l:' .. > "' ~ I, • c ::: -1 ~ " I.nl. F!t,t, M1d!llr "' 5 ~ f ] n ~I, ::,,:

' r,i..,_,, 'i.,, ,,. ~ e c.. ~ .i;.... ~j d" ~"' tnlr rOn-we, c,rr1m.u')!Ptt1on'01 tlW,Un1ticntusi line! ~ ,H ':.!~ ::2 "' ... U' :: '"' "' ~ £ .. ,~4 ~, ;"J~'f :;i:;t : 1 1 .l TAYLOR, ?ENNY, HAIUUNGTON N 56 w 2 l l 5 !in N .9& !Hi 97 91 , ____ ......_ __ _ ________________________ +--l--+--'--+----l ""u~.,,...w, N.oln.1.,,.

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~'::,:, l=t~:.. PENNY HARRINGTON TAYLOR. 134 BORGESE! LANB AUSTIN, TX 78736 """'™ n., 0 llo1~ Qli'iff

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:;;ad SOUTHBIDB WRBC'ltER INC

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AUSTlN TR.\Vf8 COUNTY 1':Mll 1 I 1

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