Taylor v. Godbold

88 S.W. 959, 76 Ark. 395, 1905 Ark. LEXIS 62

• Court: Supreme Court of Arkansas
• Decided: July 29, 1905
• Status: Published

Opinion

Hirr, C. J.

Godbold under his own testimony cannot recover as a broker. Mr. Mechem thus states the reason: “Like other agents in whom trust and confidence are reposed, the broker owes to his principal the utmost good faith and loyalty to his interests. * * * It is his duty, therefore, to fully and freely

disclose to his principal at all times the fact of any interest of his own or of another client which may be antagonistic to the interests of his principal, and he will not be permitted to take advantage of the situation to make gain for himself by forestalling or undermining his principal.” Mechem on Agency, § 952. It is unquestionably good law, as well as good morals, that the unfaithful broker who seeks a profit from the transaction other than the commission for his brokerage cannot recover of his principal for any commissions. Wordsworth v. Adams, 138 U. S. 380; Shaeffer v. Blair, 149 U. S. 248; Mechem, Agency, § § 952, 972, and numerous authorities cited. This necessarily reverses the case, and there is another matter which calls for its dismissal. Either the sale as claimed by Godbold was through him as broker or to him individually. If the former, he cannot recover on account of his failure to disclose to his principal that he had sold to his, the principal’s, advantage at $1.00 per ton and commissions above what the principal asked; and if the latter, he cannot recover because he is precluded by the statute of frauds. Kirby’s Digest, § 3656.

It is true that the statute of frauds is not pleaded in this action; there is no room for it, as the action is for broker’s commissions ; but if the action is sought to be maintained on the other theory, the facts as stated by Godbold show the contract to be void. The judgment is reversed, and cause dismissed;

•BaTTrb, J., absent.