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Free Books / Real Estate / American Law Of Real Estate Agency / | ![]() |
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Sec. 21. Consideration As An Essential Constituent Of An Enforceable Contract |
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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.
Where one employs another as agent to sell land, the contract is based upon a sufficient consideration. Rowan v. Hull, 55 W. Va. 335, 47 S. E. 92; Gilmore v. Samuels (Ky. Ct. App. '09), 123 S. W. 271. The lower price for which defendants secured the real estate is a sufficient consideration to support an agreement to pay plaintiffs a certain sum as commissions, in order to obtain the property at the price for which the owner was willing to sell it, provided he was relieved from the payment of commissions, the owner not being willing to sell at that price unless he was so relieved. Deitsch v. Feder, 86 N. Y. S. 802.
An agreement made by a broker after the sale to wait for the payment of his commissions until the title passed, was unsupported by a consideration. Hough v. Baldwin, 99 N. Y. S. 545, 50 Misc. R. 546; Shields v. Sterret (N. J. Sup. '09), 71 A. 1129.
In States requiring a written contract with a broker to sell real estate, a subsequent express promise to pay the broker a commission is without consideration to support an oral employment. Stout v. Humphrey, 69 N. J. Law 436. 55 A. 281; Bag-noli v. Madden, 76 N. J. L. 255, 69 A. 967.
In another case in the same State, it was held that where the agent advertised the property for sale at auction and secured the services of an auctioneer, and the owner sold the property privately and promised to pay the agent for his services, the promise was based upon a sufficient consideration. Griffith v. Daly, 56 N. J. Law 466, 29 A. 169.
An agent desisting from efforts to sell, upon the owner's promise to pay commissions, is a sufficient consideration to support a verdict for half the commissions. Ware v. Kerwin, 48 N. Y. S. 884, 24 App. Div. 198. Where the quantity of land fell short of what the owner supposed he possessed, and the broker agreed to a diminution of compensation, the agreement was upon a sufficient consideration. Brunson v. Blair, 44 Tex. Civ. App. 43, 97 S. W. 337. A broker who introduced a prospective buyer to the owner prior to his employment as agent, and the owner made the sale himself, was held not entitled to a commission. Bassford v. West, 124 Mo. App. 248, 101 S. W. 610; see, also, Sections 68 and 450. A release of an existing debt for commissions is a new contract and must be based on a consideration. Metcalfe v. Kent, 73 N. W. 1037, 104 Iowa, 487; Frederick Zittal & Sons v. Schwartz, 173 N. Y. Sup. 383.
Where a broker, requested by the owner of property to find a purchaser at a certain price, showed the property to the defendant, who told him he could do better by buying it himself from the owner, and if he bought would pay the broker a commission, the promise was a sufficient consideration. Abraham v. Goldberg, 25 N. Y. S. 1113, 6 Misc. R. 43.
A contract for such time as may be mutually agreeable, did not bind plaintiff except for what had been actually done, and a subsequent agreement with defendant to pay a different rate for effecting the sale of a particular property was upon a valid consideration. Forbes v. Bushnell, 47 Minn. 402, 50 N. W. 368. In an action by a broker to recover commissions for a sale of real estate to the United States, the only service shown by plaintiff that he intensified public opinion to establish a military post in the neighborhood, was held to be an insufficient consideration to support a verdict for the plaintiff. Com'l Nat. Bk. v. Hawkins, 35 I11. App. 463.
Letters of plaintiffs and defendant held insufficient to comply with the statute of frauds in the making of a real estate brokerage contract, there being no consideration named from plaintiffs to the defendant. Lueddemann v. Rudolf, 155 P. 172, 79 Or. 249; den. re. 154 P. 116, 79 Or. 249.
Where several brokers were concerned in the sale of lands, and the terms of the sale were agreed on, but the parties refused to complete the sale until there was an agreement by the brokers for division of the commission, an agreement by one of them to accept a certain sum, amounting practically to a surrender of his right to make the sale for himself to that purchaser, or any other, and to further the sale by another broker, was supported by sufficient consideration, and he was entitled to recover thereon from the broker making the sale. Morrison v. Franck, 117 P. 308, 59 Or. 429.
Where a real estate agent who negotiated a sale on instalments agreed to rescind the contract, whereby the purchaser should receive back the money already paid in, and the purchaser thereafter made no further payment, although the contract provided for forfeiture on default, there was a sufficient consideration to render the agent liable for the payment of the money already paid. E. F. Rawson & Co. v. McEinney, 157 S. W. 271, - Tex. Civ. App. - .
Owner's promise in his written offer to pay a commission for the sale or exchange of realty was designed to procure a broker's services, such services to be rendered are taken as the consideration for the promise. Oregon Home Builders v. Crowley, 171 P. 214, 87 Or. 517; den. re. 170 P. 718, 87 Or. 517.
Where a sale of land was not entered into according to brokerage contract, amount of compensation due broker being questioned, an agreement by the broker to take commission pro rata out of payments to be made on purchase price, was not without consideration, both parties surrendering claims. Colvin v. Post Mtge. & Loan Co., 122 N. E. 454, 225 N. Y. 510, rev. judg. 159 N. Y. Sup. 361; mot. to am. remit. den. 123 N. E. 860.
A broker may, if he chooses, agree that if the sale of land fails because of the seller's fault, he shall be entitled to nothing, but an agreement should not be so construed unless such a result is clearly intended. Id.
The consideration which is necessary to make a power of a broker to sell land irrevocable must be independent of the compensation to be paid for the services to be performed. Williamson R. E. Co. v. Sasser, 103 S. E. 73, - N. C. Sup. - .
 
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