Judy v. Lentz

149 N.W.2d 478, 6 Mich. App. 511, 26 Oil & Gas Rep. 322, 1967 Mich. App. LEXIS 710

• Court: Michigan Court of Appeals
• Decided: April 13, 1967
• Docket: Docket No. 1,777
• Status: Published

Opinion

Burns, J.

The plaintiff brought an action against defendants to recover commission due him on an oral contract for obtaining certain oil and gas leases for defendants. The plaintiff claims it was agreed that he would be paid the sum of $50,000 for obtaining such oil and gas leases on behalf of defendants if any one of the leases resulted in the discovery of a gas field. The plaintiff did obtain a number of leases on defendants’ behalf, and defendants subsequently struck gas under one of these leases.

Defendants admitted the existence of an agreement to obtain the leases, but denied that they ever agreed to pay the plaintiff $50,000. Defendants paid plaintiff the sum of $1,100.

The trial court granted defendant Shimmel’s motion for summary judgment on the ground that the agreement was not in writing and was, therefore, void under the statute of frauds

* which provides:

“In the following cases specified in this section, every agreement, contract and promise shall be void, unless such agreement, contract or promise, or some note or memorandum thereof be in writing and signed by the party to be charged therewith, or by some person by him thereunto lawfully authorized, that is to say: * * *

“5. Every agreement, promise or contract to pay any commission for or upon the sale of any interest in real estate.”

The plaintiff made a motion for a rehearing and leave to amend, which was denied.

On appeal the plaintiff raises 2 issues:

Does the statute of frauds, supra, prevent plaintiff-appellant from recovering a commission for obtaining gas and oil leases on certain real estate where the contract providing for the commission is in parol?

'Where plaintiff-appellant has fully performed his obligations under an oral contract to obtain gas and oil leases and the defendant has partially performed his obligation under the contract, is the agreement enforceable notwithstanding the statute of frauds?

Plaintiff’s argument that the statute does not apply because his commission was not for a sale of a real property interest but was rather for a purchase of such an interest, completely ignores the import of the words, “or upon” in the statute; his commission was obviously upon a sale although it was for a purchase. Eecently this Court in Gustafson v. Bud Clark, Inc. (1966), 5 Mich App 118, quoted Slocum v. Smith (1917), 195 Mich 281, pp 282, 283:

“ ‘While it is true, as counsel say, that a purchase is not a sale nor a sale a purchase, it is equally true that there cannot be a purchase without a sale, nor a sale without a purchase. The history of the reasons leading up to this legislation is persuasive that the law was intended to apply to an agreement for a purchase as well as a sale because one is a necessary complement of the other. Both are clearly within the mischief which was intended to be remedied by the legislature, and we think a reasonable and liberal construction of the .statute will make it apply to an agreement for a purchase as well as to a sale of real estate.’ ”

The facts in the present case are almost identical to the facts in the above quoted case, wherein there was performance by the plaintiff and a partial payment by the defendant.

Judgment affirmed. Costs to appellees.

Fitzgerald, P. J., and Quinn, J., concurred.

CL 1948, § 566.132 (Stat Ann 1953 Rev § 26.922).