Saxon Capital Corp. v. Wilvin Associates

195 A.D.2d 429, 600 N.Y.S.2d 708

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: July 29, 1993
• Status: Published

Opinions

Order, Supreme Court, New York County (William J. Davis, J.), entered January 22, 1992, which granted plaintiff’s motion for summary judgment, and judgment entered thereon on March 2, 1992, reversed, on the law, without costs, the motion is denied, and the judgment is vacated.

During the period 1989-1990 defendants Willard Scolnik and Vincent DiNapoli, doing business as Wilvin Associates, also a defendant, negotiated for the purchase of certain real property near Buffalo, New York for the sole purpose of constructing a computer facility for lease to the IRS pursuant to plans approved by the United States General Services Administration ("GSA”). Defendants approached plaintiff Saxon Capital Corporation to secure financing to purchase and develop the property, as to which Mr. Scolnik averred in his affidavit in opposition to plaintiff’s motion for summary judgment: "In explaining our need for financing, we made it absolutely clear to Mr. Italiano of plaintiff that any financing would necessarily have to be approved by GSA as a precondition of awarding the lease.”

Saxon drew up a 90-day exclusive brokerage agreement after being told of Wilvin’s requirements, "especially the fact that any financing would have to be acceptable to GSA,” and defendants signed the agreement without benefit of having it reviewed by an attorney representing Wilvin. The agreement made no mention of GSA approval despite the fact that the parties all knew, as averred by Mr. Scolnik, that without GSA approval any loan commitment would be useless to Wilvin.

In March 1990 Wilvin obtained an $18 million loan commitment from Atlantic Funding, Limited, but GSA found Atlantic Funding to be an unsatisfactory lender even after Wilvin sought reconsideration from GSA. Saxon nevertheless brought an action seeking to recover from defendants a commission of $180,000, and moved successfully for summary judgment, persuading the IAS Court that the written contract set forth completely the parties’ agreement, and therefore defendants could not offer parol evidence that GSA approval of the loan commitment was a condition of plaintiff’s earning a commission thereon. We disagree.

There is no merger clause in the agreement, and the surrounding circumstances strongly suggest that the contract was not an integrated one, and therefore extrinsic evidence would be admissible to supply the terms that the parties intended to incorporate into their agreement (see, Braten v Bankers Trust Co., 60 NY2d 155; Lee v Seagram & Sons, 413 F Supp 693, 701 [SD NY], affd 552 F2d 447; Word Mgt. Corp. v AT&T Information Sys., 135 AD2d 317). We consider that the agreement was drafted by Saxon, and thus any ambiguity or genuine issue as to the completeness of the document should be construed against Saxon’s interest, that the defendants signed it without legal advice, and that the condition of GSA approval was so central to the purpose of the loan that the condition might well have been perceived by defendants as self-evident and its omission unremarkable (compare, Namad v Salomon Inc., 74 NY2d 751). This is especially so wherein GSA approval of the lender was required by Federal regulations (see, 48 CFR 570.208-5). Moreover, the condition does not contradict any term of the agreement (see, Telemundo Group v Alden Press, 181 AD2d 453, 455).

We find other factual issues precluding summary judgment as well, including whether Atlantic Funding was financially able to make the loan (Rusciano Realty Servs. v Griffler, 62 NY2d 696), and whether plaintiff was the procuring cause of the commitment issued by Atlantic Funding, Limited. Concur —Carro, Wallach, Kupferman and Nardelli, JJ.

agreement which gives the broker an exclusive right to negotiate a loan establishes the broker’s right to a commission even upon negotiation of the loan by the owner, while an exclusive agency merely excludes the employment of another broker in making the loan. (See, Solid Waste Inst. v Sanitary Disposal, 120 AD2d 915, 916.) It cannot be concluded in this case that the agreement gave plaintiff an exclusive right rather than an exclusive agency since the commission agreement did not either contain a provision to the effect that plaintiff was entitled to a commission even upon Wilvin’s negotiation of a commitment or expressly exclude Wilvin from independently negotiating a commitment. (Supra.) While the agreement may be ambiguous in this regard, in the absence of extrinsic evidence demonstrating that the agreement gave plaintiff the exclusive right to negotiate a commitment rather than an exclusive agency, we are presented only with a question of law. (Supra, at 917.)