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Free Books / Real Estate / American Law Of Real Estate Agency / | ![]() |
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Chapter V. Sec. 25. Privity |
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This section is from the book "American Law Of Real Estate Agency", by William Slee Walker. Also available from Amazon: American law of real estate agency.
In the absence of contractual relations, a sub-agent is not entitled to recover from the owner for want of privity. J. B. Watkins Ld. Mtge. Co. v. Thetford (Tex. Civ. App. '06), 96 S. W. 72; Sterling v. DeLaune (Tex. Civ. App. '07), 105 S. W. 1169. See also Sec. 393. Ranney v. Donovan, 78 Mich. 318, 44 N. W. 276; Mechem on Ag. Secs. 197, 227; Mueller v. Bell (Tex. Civ. App. '09), 117 S. W. 993.
Fraudulent representations made to the principal by third parties in privity with the broker, defeat his right to commissions. Mullen v. Bower, 22 Ind. App. 294, 53 N. E. 790. See also Secs. 390, 391. If A is employed as a broker to sell B's house, on an agreement that he will inform B, if he sends a purchaser, and A and C then agree that if C will procure a purchaser, he shall share with A in the commission, and C, in going to look at the house, tells B that no broker has anything to do with the trade, and a price is named on that understanding, and the house is bought by a purchaser procured by C, A and C are partners in the business of effecting a sale of B's house to such' purchaser, and C's fraud, though not participated in by A, will bar an action by A against B for the commission, prosecuted for the joint benefit and at the joint expense of A and C. Thwing v. Clifford, 136 Mass. 482; Haven v. Tartar, 124 Mo. App. 691, 102 S. W. 21.
A broker employed to sell real estate is unable, for want of privity, to enforce a stipulation in the contract of sale between vendor and vendee by which the latter agrees to pay the commission. Bab v. Hirschbein, 11 N. Y. S. 776; Gridley v. Bayless, 43 I11. App. 503; Lawyer v. Post, 109 Fed. Rep. 512, 47 C. C. A. 491; Davenport v. Ash, 121 La. 209, 46 S. 213; Le Master v. Dotham Real Est. Ag. (T. C. A. '09), 121 S. W. 185. See also Sec. 662. For the same reason, a purchaser can not, in an action ex contractu, recover from the agent of the seller the excess paid to the agent beyond the price demanded by the seller. Lazarus v. Sands, 27 N. Y. S. 885, 7 Misc. R. 282, 33 N. Y. S. 855, 12 Misc. R. 575.
Where an agent to sell property sells to a firm of which he is a member, without the knowledge of the principal that he is interested in the purchase, the partners of the agent can not recover damages of the principal on account of misrepresentations made by the agent, they being parties to his violation of his trust. Pineville v. Hollingsworth, 21 Ky. L. R. 899, 53 S. W. 279.
Purchasers of land were under no legal obligation to the owner's broker, and could so arrange the purchase as to permit another broker to procure the commission, though the owner's broker drew their attention to the property, and he has no cause of action against the other broker, his remedy being against his principal, if he was the procuring cause of the sale. Op-penheimer v. Barnett, 116 N. Y. S. 44.
A purchaser of property from a broker could not defeat the broker's right of action on a check of the purchaser turned over to him by the owner of the property sold, because the broker made false representations as to what the owners would sell for. Arono-witz v. Woolard, 152 N. Y. Sup. 11, 166 App. Div. 365.
Where title to land remains in his principal, a broker whose commission is contingent on closing a sale has no such an interest in the sale contract as entitled him to sue for its breach, although the contract is made in the broker's name. Hardie v. Dan Sonnentheil Co., 192 S. W. 1161, - Tex. Civ. App. - .
Where agent of a farm employed another broker as agent, who sold the farm at a price in excess of the minimum demanded, pocketing the difference, the seller, by a cross-complaint for such difference, ratified the appointment and the sale, so that there was a privity of contract with the selling agent which entitled the owner to recover, as the real party in interest, such difference. Burt & Carlquist Co. v. Marks, 177 P. 224, - Utah Sup. - .
Where agent for the sale of land had previously agreed with a third person to divide commission with him, such third person was neither a necessary nor a proper party to an action for commissions, the owner of the land not being in privity with him. Jenkins v. Irwin, 178 P. 33, - Ariz Sup. - .
A realty broker who procured defendant to agree to exchange his land for the land of the broker's principal is not entitled to recover damages by way of lost commissions from defendant who has refused to perform. Baker v. Greer, 208 S. W. 755, - Tex. Civ. App. - .
 
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