Reed v. Lee

372 S.W.2d 234, 237 Ark. 98, 1963 Ark. LEXIS 496
CourtSupreme Court of Arkansas
DecidedOctober 28, 1963
Docket5-2987
StatusPublished

This text of 372 S.W.2d 234 (Reed v. Lee) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Reed v. Lee, 372 S.W.2d 234, 237 Ark. 98, 1963 Ark. LEXIS 496 (Ark. 1963).

Opinion

Carretón Harris, Chief Justice.

The facts in this case are somewhat complicated. Appellant, H. W. Reed1 has at all times pertinent hereto been the owner of some 6.000 acres of land in Baxter County. Carl W. Lee, one of the appellees herein, is a real estate broker, living in Bentonville, Arkansas. Reed did not actually list the 6.000 acres with Lee, but did authorize the latter to sell it. Reed also had for sale 532 head of cattle. During the months of June and July, 1961, Lee and another realtor, Omar Head, of Amarillo, Texas, (also an appellee herein) arranged a transaction by which Reed would exchange his Baxter County property for a Texas Hotel owned by Grey Investment Company of Eastland, Texas, (third appellee herein). Don Pierson was President of Grey. However, Reed, a resident of Alvarado, California, desired to dispose of his non-California investments, and he, therefore, would only agree to the trade if the hotel could also be sold. Head arranged a trade of the hotel for 2.4 acres in Amarillo, Texas, owned by J. W. Bragg of Amarillo, together with a monetary payment on the part of Bragg.

On August 7, 1961, two contracts were prepared in Head’s office in Amarillo, both being dated August 8, since the 7th was a Sunday. Under the first contract, Reed agreed to trade his Baxter County land for Grey’s hotel. The contract recited that the parties had deposited $5,000.00 with realtors Lee and Head, and further provided that these brokers would receive a total commission of $10,000.00 for their services. The provision reciting that $5,000.00 had been deposited was admittedly erroneous. Under the second contract, Reed agreed to trade the newly acquired hotel to Bragg in exchange for Bragg’s 2.4 acres of land, and the sum of $130,000.00, payable in monthly payments of $780.00 each. This contract was executed by both Reed and Bragg at the time, but there is a notation on the agreement, £ £ contingent on trade with Don Pierson.” The contract between Reed and Pierson was not executed at that time; in fact, Pier-son was not present, but was represented at the meeting by Head. Reed then flew back to California, taking both contracts with him.

The next day, August 8, Reed consulted his attorney, James R. Slaybaugh, lawyer of Hayward, California, and directed him to delete the erroneous recital about the $5,000.00 payment to Lee and Head,2 and further instructed Slaybaugh to prepare a Supplemental Commission Agreement (hereinafter called S.C.A.), which provided that the $10,000.00 commission to be paid to Lee and Head (heretofore referred to) would only be paid when the 2.4 acres involved in the contract with Bragg had been sold at a net of $50,000 to Reed, such sale to be made within two years. Slaybaugh then inserted in the Reed-Grey contract a reference to the S.C.A. and mailed this contract and the S.C.A., both signed by Reed, to Head, directing that Head retain signed copies and return copies of the contracts if acceptable. In chronological order the following events then transpired:

August 10: Head called Reed with reference to the S.G.A., stating that it was unacceptable and tried to get Reed to change the agreement. Reed refused to do so. It does not appear from the conversation, however, that either party considered that the S.C.A. had been definitely or finally rejected.

August 15: Because Reed had asserted that he did not have the cash money to pay the commission at the outset, Lee called Reed and suggested that $5,000.00 of the commission might be obtained from a sale of the cattle. Reed agreed.

August 16: Reed telegraphed Lee AAdierein he confirmed the conversation by Avhich he agreed to pay $5,000.00 if the cattle should be sold for $85,000.00.

August 20: Lee obtained a firm offer from Norman Gibson, Weatherford, Texas, of $85,000.00 for the cattle.

August 24: Lee, Head, and Pierson signed the Reed-Grey contract.3

August 25: Lee contracted Clayton Little, an attorney of Bentonville, Arkansas, Avho called Slaybaugh relative to Lee’s concern over the recitation that the brokers had already received $5,000.00. Lee desired to either receive the $5,000.00 or obtain an acknoA\dedgment from Reed that the amount had not been paid.

August 28: Little again called Slaybaugh, and according to his (Little) testimony, told Slaybaugh that Lee had obtained the offer of $85,000.00 from Gibson for the cattle and further advised that the S.C.A. Avas acceptable to appellees, Lee and Head, “that we had everything completed on this end.” Slaybaugh, subsequently, in a deposition, denied that he had been advised that either the Reed-Grey contract or the S.C.A. had been accepted or executed. According to his testimony, the conversation related only to clarifying the S.C.A., and its effect upon the commission terms of the Reed-Grey contract. As he stated, “All this suggested to me that there had been no action taken by his clients at that time.” In the deposition, Slaybaugh denied that he was an agent for Reed or had any authority to act for appellant in the matter.

August 29: Reed wired Little, Lee, and Pierson, withdrawing his offer to sell the Baxter County lands.

August 30: Lee and Head instituted suit against appellant, seeking judgment for $15,000.00 ($10,000.00 for the real estate transactions and $5,000.00 for the sale of the cattle).

September 20: Grey Investment Company, through its president, Don Pierson, instituted suit against appellant in the Baxter County Chancery Court, asking specific performance.

Following the filing of an answer and certain motions, the causes were consolidated for trial, and heard by the Chancellor. Thereafter, the Court made the following findings:

That the contract between Grey Investment Company and H. W. Reed was executed by all parties prior to the attempted cancellation by Appellant Reed through telegram from Reed’s attorney, dated August 29, 1961; that Grey Investment Company was entitled to specific performance of the contract; that Head and Lee had agreed to the terms of the S.C.A., and their agreement was communicated to Slaybaugh prior to the attempted cancellation of the original contract; that the S.C.A. had been modified by communication between Reed on the one hand, and Head and Lee on the other, to the extent that these appellees would receive $5,000.00 of the commission at the time of the exchange of the Baxter County property for the hotel property, and that the remaining $5,000.00 of the commission would be due upon the sale of the 2.4 acres of land in Amarillo, Texas, such sale to be made within a two-year period, and in an amount which would net Reed $50,000.00 after payment of the commission.

The court further found that Head and Lee were entitled to judgment for $5,000.00 already earned under the terms of -the contract, but that they were not entitled to a commission for the sale of the cattle, inasmuch as Reed’s agreement to pay the first $5,000.00 due (because of the sale of the Baxter County lands) was conditioned on Head and Lee securing a buyer for the cattle at the stipulated price; that these appellees did obtain such a buyer. From the decree entered embodying these findings, and directing Reed to immediately perform the contract dated August 8, 1961, appellant brings this appeal.

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

Cite This Page — Counsel Stack

Bluebook (online)
372 S.W.2d 234, 237 Ark. 98, 1963 Ark. LEXIS 496, Counsel Stack Legal Research, https://law.counselstack.com/opinion/reed-v-lee-ark-1963.