Sec. 87. Termination Of Agency By Previous Sale

A previous sale revokes the agent's authority,27 and no notice to the broker of the sale is necessary.28 A broker must produce his customer while the premises are in the market; the owner does not contract to hold them for the customer to be produced by the broker, but, acting in good faith, he may sell the premises at any time and to any customer who is willing to buy upon his terms, and commissions cannot be collected for customers produced after the premises have been sold.29

And a real estate broker is not entitled to commissions if his principal has already in good faith sold the property to the same customer through another broker.30

But the giving of an option to another person is not a previous sale.31

24 Peach R. Co. ▼. Montgomery. 115 S. W. 87 (Tex. 1908).

25 Finck v. Scnmitt. 48 Misc. 503 (N. T. 1905). See also preceding sections.

26 Moore v. Boebm. 45 Misc. 622 (N. T. 1904).

27 Gerdlng v. Haskin. 141 N. Y. 520 (1894); Weisels v. Wainwright. 127 Mo. App. 514 (190T) ; Wallace v. Figone. 107 Mo. App. 366. 367 (1904). (citing Ahem v. Baker. 34 Minn. 98; Walker v. Denison. 86 111. 142; Bissen v. Terry. 69 111. 184; Dolan v. Scanlon. 57 Cal. 261; Tiffany on Agency. pp. 134. 135; Mechem on Agency. Sec. 969; Parsons on Contracts. 71; Reinhard on Agency. Sec. 160).

28 Wallace v. Figone. mart.

29 Fittingboff v. Horowitz. 115 App. Div. 571 (N. T. 1906).

29 Hodge ▼. Appellee. 122 App. Div. 437 (N. Y. 1907).

30 Wallace t. Figone, supra.

Sec. 88. Good Faith Necessary To Termination Of Agency By Previous Sale

On an issue as to the good faith of the owner in terminating the plaintiff's employment and selling the property through other brokers to the same person, the owner may show that he paid a commission to the broker through whom the sale was finally effected, and this is relevant, as it tends to show that the owner did not terminate plaintiff's agency for the purpose of avoiding payment of commissions.32

Where the broker produces a customer ready, willing and able to buy and apparently acceptable to the vendor, he has, under the general rule,33 earned his commission, although after a delay was had for proper reasons the vendor informs the broker that the property is sold.84

Sec. 89. Termination By Destruction Of Subject-Matter

"If the subject-matter of the agency is extinguished or ceases to exist, this will revoke the agency. It has been held, for instance, that where two persons jointly appoint an agent to take charge of some matter in which they are jointly interested, as to sell real estate owned by them jointly, a severance of the joint interest revokes the agency." 35

Sec. 90. Termination By Bankruptcy

Bankruptcy, either of principal or broker, operates as a revocation of the agent's authority.36 As a practical proposition it may be suggested that if the broker went into bankruptcy before bringing about a sale nothing would be due him and no question would arise. If he went into bankruptcy after effecting a sale and before collecting his commissions, the trustee in bankruptcy would succeed to the money. If the principal goes into bankruptcy before the broker completes a sale, the agency is no doubt terminated, for bankruptcy in effect brings about the destruction of the subject-matter, the bankrupt's title passing to the trustee in bankruptcy. If the principal becomes a bankrupt after the consummation of the sale and before payment of commissions, the broker stands as does any other creditor.37

32 Sewell v. Collison, 123 App. Div. 58G (N. Y. 1908).

33 See Sec. 117-119 infra.

34 Parvln v. Abels-Gold Realty Co., 126 App. Div. 329 (N. Y. 1908).

35 Clark on Contracts. 750, (citing Rowe v. Rand, 111 Ind. 200; 12 N. E. Rep. 377).

36 Davis v. Lane, 10 N. H. 158. See also Clark on Contracts, 750.