Wright v. M. B. Hagen Realty Co.

269 N.W.2d 62, 1978 Minn. LEXIS 1258
CourtSupreme Court of Minnesota
DecidedJuly 21, 1978
Docket47634
StatusPublished
Cited by5 cases

This text of 269 N.W.2d 62 (Wright v. M. B. Hagen Realty Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wright v. M. B. Hagen Realty Co., 269 N.W.2d 62, 1978 Minn. LEXIS 1258 (Mich. 1978).

Opinion

*63 WAHL, Justice.

This action is brought by a real estate agent to recover commissions allegedly due on a lease-option agreement and to establish the percentage rate for future commissions under that agreement. The jury verdict permitted plaintiff to recover on the commissions claimed to be due but failed to establish the percentage rate for future commissions. Plaintiff appeals from the judgment. We remand with instructions.

Some detailed facts are essential. Charles W. Wright, plaintiff-appellant, became employed as a real estate salesman in 1964 by defendant, a firm engaged in business as real estate brokers. His compensation was based on a commission arrangement. The standard commission of the firm for sales of unimproved land was 10 percent of the sale price and for at least 6 percent of the rents paid. Plaintiff’s share regularly received was 4.3 percent of the sale price of unimproved land and 2.58 percent of rentals paid on transactions where he procured the customer. Under certain circumstances not applicable here, a negotiated rate for commissions was applied.

The customer or purchaser in the involved transactions was one Robert Keller. Keller first became known to plaintiff in March 1967. Keller was interested in vacant land for the development of apartment buildings. Plaintiff sold Keller certain property of the defendants, the “Astleford” project, on May 5, 1967. Plaintiff was paid the regular commission for this sale. This sale led to plaintiff’s showing other property to Keller.

Defendants Mason and Hagen individually owned or controlled considerable property suitable for apartment construction. During the period from January through March of 1968, plaintiff showed Keller various property, particularly the “Ridgeway” property. Negotiation for the sale of this property failed. In the general area of the “Ridgeway” property defendants owned or controlled additional land suitable for apartments. The specific property was 134 acres of contiguous unimproved land, which plaintiff claimed he showed to Keller in March 1968. It was also represented by plaintiff that Keller was interested in the property if it could be rezoned and sewer and water obtained. Plaintiff testified that defendant Mason wanted to proceed with the rezoning on a piecemeal basis, starting with a portion referred to as “19 Acres,” with the understanding that Keller would have the first right to buy additional land. A purchase agreement was executed by Keller in March 1968, involving the “19 Acre” tract. The purchase agreement contained provisions for rezoning and sewer and water service. Mason handled the rezoning. Plaintiff attended some of the rezoning hearings, which was finally approved in October 1968. The property identified as the “19 Acre” tract was deeded in January 1969 by defendant to Keller. Plaintiff received his regular commission for this sale in January 1969.

The foregoing transactions were presented by plaintiff to establish that he introduced Keller to the defendants and the involved property. This action was to recover for the unpaid commission which arose out of a subsequent transaction.

After completion of the sale of the “19 Acres,” plaintiff was informed by Mason that he had worked out an arrangement with Keller to buy the rest of the tract. This was accomplished by an agreement between the individual defendants and Keller designated as a lease option agreement, dated November 30, 1970. The land involved in the lease option agreement covered 115 acres contiguous to the “19 Acres.”

The land was divided into eight phases by the lease option agreement. Pursuant to the agreement, at least one phase had to be leased by May 1, 1971, and at least one each subsequent May 1, and all by May 1, 1977. Keller, the lessee, was granted the option to buy two designated phases in 1973. Rent was required to be paid as to each designated phase. Other details of the lease option agreement are not essential to this decision.

In 1969, and prior to the creation of the lease option agreement, plaintiff established by documents that Keller agreed to buy from defendant certain land described *64 as Greenbriar Lots 1 and 2. This land is contiguous to and southwest of the “19 Acres” and part of the 115 acres later placed under the lease option agreement. The sale was not completed in 1969. This contract to purchase was rescinded and the land merged into the lease option agreement.

In any event, on November 13, 1973, the property designated as Phase One of the lease option agreement (Greenbriar Lots 1 and 2) was conveyed by deed by the defendant to Keller Investment Company. The price was $357,533.10. No commission was paid to plaintiff on this sale or on the rents paid by Keller to defendant. The rents paid pursuant to the lease option agreement amounted to $118,594.83. The rate of the commission for sales and rents paid was not seriously disputed by the defendant. This suit was brought to recover the commission due on this sale of November 13, 1973, and the rents paid up to December 1975. In addition to the commissions for rents and the purchase, the suit was for specific performance on any subsequent sale to Keller by defendants pursuant to the lease option agreement.

The controlling legal principle is not disputed by the parties and is set out in defendant’s brief as follows:

“ * * * All [the cases] stand for the proposition that if a broker produces a willing buyer and a willing seller, who, respectively, buy and sell at an agreed price, through the efforts of the broker, the broker is entitled to his commission.”

Defendants offered testimony supporting their position that plaintiff had nothing to do with obtaining the lease option agreement. Keller gave corroborating evidence supporting this position. Defendants also argue that the land sold was not even owned by them at the time plaintiff contended he showed the property to Keller.

The evidence, however, clearly created a fact issue for the jury. Defendant’s motion for a direct verdict was denied. The case was submitted to the jury upon special interrogatories as set forth in the verdict. 1

In response to Question 2, the jury found that plaintiff was entitled to $3,000 as commission for lease rents paid through December 24, 1973. This figure compares with plaintiff’s computation of $3,056, based upon 2.58 percent of the actual lease payments made ($118,594.83), and on their face merely a rounding off of the sums due at that percentage.

In response to Question 3, the jury found that plaintiff was entitled to $15,000 as commission for the property conveyed to Keller on November 13, 1973. This compares with the figure of $15,373.29, based upon 4.3 percent of the actual sale price ($357,533.10), and again on the face is merely rounding off the sum at the claimed percentage.

Questions 4 and 5 were presented to the jury to establish the rate of commission on *65 any sales or rents paid in the future arising from the lease option agreement.

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Cite This Page — Counsel Stack

Bluebook (online)
269 N.W.2d 62, 1978 Minn. LEXIS 1258, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wright-v-m-b-hagen-realty-co-minn-1978.