Jory v. Bennight

542 P.2d 1400, 91 Nev. 763, 1975 Nev. LEXIS 768
CourtNevada Supreme Court
DecidedDecember 5, 1975
Docket7835
StatusPublished
Cited by13 cases

This text of 542 P.2d 1400 (Jory v. Bennight) is published on Counsel Stack Legal Research, covering Nevada Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jory v. Bennight, 542 P.2d 1400, 91 Nev. 763, 1975 Nev. LEXIS 768 (Neb. 1975).

Opinion

*764 OPINION

By the Court,

Gunderson, C. J.:

Appealing a judgment for $4,250 damages plus $1,500 attorney fees, awarded for breaching their fiduciary duties to *765 respondent Jane Bennight, appellants contend inter alia: that appellant Edward E. Jory has no responsibility for the conduct of the other appellants, Edward E. Jory Corporation and two of its real estate salesmen, George E. Burns and Harry J. Adams; and that, in any event, evidence relating to damages does not sustain the judgment. We disagree.

Edward E. Jory incorporated his real estate business under the name of Edward E. Jory Corporation in December, 1969. Jory is a corporate shareholder and, as the trial court apparently inferred from evidence before it, the officer licensed on behalf of the corporation pursuant to NRS 645.370. 1 The corporation employed George E. Burns and Harry J. Adams as licensed real estate salesmen.

In June of 1970, respondent Bennight listed her home for sale with the Jory corporation. Bums and Adams showed the home to a Mr. and Mrs. Lewis, who commenced negotiations for its acquisition. Through Burns and Adams, they tendered an offer for $37,000, which Bennight accepted. After this agreement failed because the Lewises could not obtain contemplated financing, another ofEer set forth a purchase price of $32,750. Evidence the trial court could credit indicates Ben-night assented to this lower offer because Bums and Adams deceitfully or negligently promised she would receive an additional $4,500 outside of escrow: $2,500 more cash for her home, plus $2,000 as compensation for furniture also conveyed to the Lewises.

Bennight testified that, after she failed to receive the $4,500, *766 and while she might still have rescinded the transaction, she sought an explanation from Edward Jory. Except for an early morning phone contact in which Jory promised to investigate the matter, Bennight’s evidence indicates he eluded all her efforts to confront him. It further appears that although Jory had personal knowledge of possible misconduct by Burns and Adams, he neither informed Bennight concerning the outcome of his promised investigation, if in fact he ever conducted one, nor did he attempt in any manner to rectify the wrong done to her.

Receiving no satisfaction, Bennight sued not only the Jory corporation and its salesmen, but Edward Jory. The trial court found all such defendants had breached their fiduciary duties, and awarded respondent $4,250. This appeal follows.

1. Public records of the Nevada Real Estate Division show Edward Jory requested that his status be changed from licensed broker to licensed corporate officer on February 6, 1970. The Division, approving this request on February 7, issued a new license in the name of Edward E. Jory, President-Treasurer, Edward E. Jory Corporation. Further, our Secretary of State’s records list Edward Jory as the President, Treasurer, and a director of the corporation. Thus, assuming arguendo that the trial transcript leaves Jory’s status in question, we deem it appropriate to take judicial notice that Edward Jory, as President-Treasurer of Edward E. Jory Corporation, was the officer licensed as broker on behalf of the corporation. See: NRS 47.130; Cannon v. Taylor, 88 Nev. 89, 493 P.2d 1313 (1972); Chas. L. Harney, Inc. v. State, 31 Cal.Rptr. 524 (Cal.App. 1963). Were we to remand for a new trial because Jory’s relationship to the corporation was not sufficiently shown, as appellants apparently suggest, that fact would nonetheless be “capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” NRS 47.130(2) (b).

2. In essence, appellants contend that a real estate broker like Jory, by electing to conduct his activities on behalf of a corporation, can absolve himself of all fiduciary responsibility normally owed to the public. We deem this position untenable. Use of the corporate structure to evade legal obligations and defeat public policy is not favored. Bangor Punta Operations, Inc. v. Bangor & A. R. Co., 417 U.S. 703 (1974); N.L.R.B. v. Miller Trucking Service, Inc., 445 F.2d 927 (10 Cir. 1971); *767 E. Albrecht & Son v. Landy, 114 F.2d 202 (8 Cir. 1940); United States v. Hudgins-Dize Co., 83 F.Supp. 593 (E. D. Vir. 1949). Moreover, it seems clear our legislature, in permitting the business of real estate brokerage to operate in corporate form, had no intent to relieve brokers of professional responsibility. Instead, the legislature has provided that a broker’s license will be issued, not alone to a corporation as such, but only to a qualified officer on behalf of the corporation. NRS 645.370. We are, therefore, concerned with the obligations and liability of a corporate officer who is licensed to carry out the corporation’s duties as a broker.

In urging that Edward Jory owed no duty to Bennight we think appellants misconstrue Jory’s status. He remained a real estate broker, although licensed to serve clients on behalf of a corporation. Like any broker, Jory had fiduciary duties to those he had undertaken to serve in a professional capacity, including a duty “to act in the utmost good faith,” and “to disclose to his principal facts within or which may come to his knowledge which might influence the principal in the transaction.” Keyworth v. Nevada Packard Co., 43 Nev. 428, 436, 186 P. 1110, 1112 (1920). Therefore if Jory, through his own professional misconduct or neglect, breached fiduciary obligations owed to Bennight, he is personally responsible for consequent harm, and operating in the corporate form does not insulate him from such liability. Cf. Adams v. Fidelity & Casualty Co. of New York, 107 So.2d 496 (La.Cir.Ct.App. 1958).

Some jurisdictions, indeed, take the view that the designated broker shares responsibility for any and all breaches of fiduciary duty attributable to the corporation. Circle T. Corporation v. Deerfield, 444 P.2d 404 (Colo. 1968); see Code of Ala., Tit. 46, § 311(5)(Supp. 1973). In the instant-case, however, we need not go so far as to declare brokers accountable for breaches they do not participate in, countenance, or direct. Here, we only need recognize that a broker, though licensed on behalf of a corporation, stands personally responsible for his own professional defaults. 2

*768

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Miyayama v. Hosoda
D. Nevada, 2025
In Re USA Commercial Mortg. Co.
802 F. Supp. 2d 1147 (D. Nevada, 2011)
3685 San Fernando Lenders, LLC v. Compass USA SPE LLC
802 F. Supp. 2d 1147 (D. Nevada, 2011)
Mikohn Gaming v. Espinosa
137 P.3d 1150 (Nevada Supreme Court, 2006)
Whitehead v. Nevada Commission on Judicial Discipline
873 P.2d 946 (Nevada Supreme Court, 1994)
Brown v. Grabau (In Re Grabau)
151 B.R. 235 (N.D. California, 1991)
Ainsworth v. Combined Insurance Co. of America
774 P.2d 1003 (Nevada Supreme Court, 1989)
Northern Nevada Mobile Home Brokers v. Penrod
610 P.2d 724 (Nevada Supreme Court, 1980)
Landex, Inc. v. State Ex Rel. List
582 P.2d 786 (Nevada Supreme Court, 1978)

Cite This Page — Counsel Stack

Bluebook (online)
542 P.2d 1400, 91 Nev. 763, 1975 Nev. LEXIS 768, Counsel Stack Legal Research, https://law.counselstack.com/opinion/jory-v-bennight-nev-1975.