Majority
Plaintiff has appealed from an order dismissing his action, entered after the court sustained defendants’ demurrer to plaintiff’s third amended complaint without leave to amend.[1]
The third amended complaint alleges the following facts: In January of 1966 plaintiff orally agreed (1) to find and introduce defendants to a person or persons who would lease defendants’ real property in Torrance, California; and (2) to introduce defendants to a contractor and designer with whom plaintiff—on his own behalf—had negotiated a tentative agreement for the construction of a building on the property.[2] As consideration for the foregoing, defendants orally promised that if a lease could be negotiated with such person or persons they would pay plaintiff 5 percent of the rent received therefrom, or sixty dollars per month, whichever amount was greater, on the first day of each month.
In reliance upon defendants’ promise, plaintiff introduced a prospective lessee to defendants. The newly acquainted parties thereafter negotiated and executed a 10 year lease of the property. In further reliance upon defendants’ promise plaintiff introduced the contractor and designer to defendants. Defendants then negotiated and consummated an agreement with the contractor and designer for the construction of a building on substantially the same terms as plaintiff had earlier negotiated. Plaintiff sought an accounting and a judgment for all sums defendants owed him under the alleged oral agreement.
The trial court’s order sustaining the demurrer without leave to amend citeg no reasons for the ruling. A later order denying reconsideration indicates that the court felt that the oral contract pleaded was barred by subdivision 5 of section 1624 of the Civil Code and that plaintiff had not adequately explained fatal allegations made in previous complaints.
1 Actually, plaintiff has purported to appeal from the order sustaining the demurrer and from an order denying his motion “for reconsideration and for order overruling of demurrer, or for an order granting pláintiff leave to amend.” Of course, such orders are not appealable. (Daar v. Yellow Cab Co., 67 Cal.2d 695 , 699 [ 63 Cal.Rptr. 724 , 433 P.2d 732 ]; Cole v. Rush, 40 Cal.2d 178 [ 252 P.2d 1 ]; Oeth v. Mason, 247 Cal.App.2d 805 , 808 [ 56 Cal.Rptr. 69 ].) However, a notice of appeal from such nonappealable orders may be liberally construed as an appeal from the judgment if there is one. (Galanis v. Mercury Intl. Ins. Underwriters, 247 Cal.App.2d 690 , 692-693, fn. 1 [ 55 Cal.Rptr. 890 ]; cf. Curnutt v. Holk, 203 Cal.App.2d 6 , 7 [ 21 Cal.Rptr. 224 ].) Accordingly, we treat plaintiff’s appeal as being from the order dismissing his action.
2 It appears from the first amended complaint that plaintiff previously owned the real property.
On the other hand, the fact that the trial court may have sustained defendants’ demurrer upon an erroneous theory does not preclude this court from deciding that the complaint was demurrable upon another ground. (Apelian v. County of Los Angeles, 266 Cal.App.2d 550 , 554 [ 72 Cal.Rptr. 265 ]; Rupp v. Kahn, 246 Cal.App.2d 188 , 192, fn. 1 [ 55 Cal.Rptr. 108 ]; Weinstock v. Eissler, 224 Cal.App.2d 212 , 225-226 [ 36 Cal.Rptr. 537 ].)
Defendants argue on appeal that plaintiff’s lawsuit is barred by section 10136 of the Business and Professions Code, which, in relevant part, provides: “No person engaged in the business or acting in the capacity of a real estate broker . . . within this State shall bring or maintain any action in the courts of this State for the collection of compensation for the performance of any of the acts mentioned in this article without alleging and proving that he was a duly licensed real estate broker ... at the time the alleged cause of action arose.” (Italics added.)
3 The error was apparently induced by defendants’ reference to the statute of frauds in their demurrer. As will be seen, on appeal, they correctly rely on section 10136 of the Business and Professions Code.
4 See also former section 1973, subdivision 5 of the Code of Civil Procedure, as amended in 1963. (Stats. 1963, ch. 814, p. 1843, § 2.) It provided substantially the same thing as section 1624, subdivision 5, as quoted above. Section 1973 was repealed in 1965, effective January 1, 1967. (Stats. 1965, ch. 299, p. 1363, § 113.)
Section 10131 of the Business and Professions Code defines a real estate broker as a “person who, for compensation or in expectation of a compensation, does or negotiates to do one or more of the following acts for another . . .: (b) Leases or rents or offers to lease or rent, or places for rent, or solicits listings of places for rent, or solicits prospective tenants. . . .”
The rule is well established that one who simply finds and introduces a prospective lessee to a person who wishes to lease his property need not be licensed by the state in order to recover a commission for his services. Such an intermediary is protected by the so-called “finder’s” exception to the real estate licensing act. The doctrine has been judicially developed by a line of decisions dating back to Shaffer v. Beinhorn, 190 Cal. 569 , 573-574 [ 213 P. 960 ]. Shaffer arose under the Real Estate Brokers’ Act (Stats. 1919, ch. 605, p. 1252). The defendant in that case, a licensed real estate broker, agreed to pay plaintiffs two-thirds of the gross commission to which he would be entitled upon the sale of a certain ranch if they found or introduced him to a buyer of the ranch. Plaintiffs, who were not real estate brokers, thereafter procured a prospective buyer with whom defendant negotiated and consummated a sale of the ranch. Plaintiffs sued defendant for the promised portion of his commission. In holding the trial court erred in sustaining a demurrer to the complaint, the Supreme Court held that the complaint did not show that plaintiffs were engaged in the business, or acting in the capacity of a real estate broker or salesman, since the contract with defendant required them only to find or introduce defendant to a prospective purchaser who ultimately became the actual buyer of the ranch. (Cf. Davis v. Chipman, 210 Cal. 609 , 619-620 [ 293 P. 40 ].)
The rule thus announced in Shaffer has continued as a gloss upon parallel provisions of the Real Estate Law, which was enacted in 1943 (Stats. 1943, ch. 127, p. 828, § 1) to supersede the Real Estate Brokers Act. (Crofoot v. Spivak, 113 Cal.App.2d 146 , 147-148 [ 248 P.2d 45 ]; Palmer v. Wahler, 133 Cal.App.2d 705 , 708-711 [ 285 P.2d 8 ]; Porter v. Cirod, Inc., 242 Cal.App.2d 761 , 762-766 [ 51 Cal.Rptr. 784 ]; cf. Hasekian v. Krotz, 268 Cal.App.2d 311 , 312-324 [ 74 Cal.Rptr. 410 ].) It has been utilized to permit nonlicensees to sue for commissions in other areas where licensed brok
The decisions have drawn the line between “brokers” and “finders” on the basis of whether the person in question has engaged in any negotiating to consummate the transaction. Thus, in Shaffer v. Beinhorn, supra, after holding that the plaintiff’s complaint stated a cause of action, the Supreme Court stated; “It may be that upon a trial of the case the defendant may be able to prove that plaintiffs did in fact actually assist in negotiating the sale. If he can do this, it is a good defense.” (190 Cal. at p. 574; see also Hasekian v. Krotz, supra, 268 Cal.App.2d 311 , 319-323; Rhode v. Bartholomew, supra, 94 Cal.App.2d 272 , 280; Spielberg v. Granz, 185 Cal.App.2d 283 , 290-292 [ 8 Cal.Rptr. 190 ].)
If we focused exclusively upon the allegations of the third amended complaint, it would be a close question whether plaintiff has asserted a right to recover compensation as a finder or as a broker. That complaint alleges that after entering into the contract with defendants, plaintiff merely introduced the lessee, contractor and designer to defendants. The only negotiations to which plaintiff adverts in his third amended complaint are those by which he engaged the builders before his agreement with defendants and in his own behalf.
It would be improper so to limit our perspective, however. The third amended complaint is the last of a series of four complaints plaintiff has filed in this action. In his original complaint plaintiff simply alleged that he had rendered services to defendants. Defendants demurred on the ground that the complaint was uncertain because they could not ascertain what the services were. The court sustained the demurrer with leave to amend. Plaintiff’s first amended complaint clarified what services plaintiff claimed to have rendered. It alleged that plaintiff offered to obtain a certain pros
5 Section 1624, subdivision 1 reads: “The following contracts are invalid, unless the same, or some note or memorandum thereof, is in writing and subscribed by the party to be charged or by his agent: 1. An agreement that by its terms is not to be performed within a year from the making thereof. . . .”
6 The original complaint and first and second amended complaints were filed in the municipal court. Upon appeal from the dismissal based upon order sustaining defendants’ demurrer to the second amended complaint, the appellate department of the superior court reversed on the ground that the municipal court lacked jurisdiction over the subject matter of the action. The case was remanded to the municipal court with instructions to transfer the action to the superior court under sections 396 and 399 of the Code of Civil Procedure. After the transfer plaintiff filed his second amended complaint in the superior court. When defendants’ demurrer thereto was sustained with leave to amend, plaintiff filed his third amended complaint in the same court.
The pleadings made clear that the lease and building arrangements formed two parts of a single transaction. Plaintiff himself recognizes this. His opening brief characterizes the agreement with defendants as one for the “sale” of a “ ‘package’ consisting of the prospective lessee and an agreement to make the necessary arrangements for the construction” of the building. The two parts add up to the following real estate transaction: Plaintiff was to furnish defendants with a tenant for their real property. To secure a tenant it was necessary that a building be erected on the property. Therefore, plaintiff assumed the further obligation of making arrangements for the construction of such a building. Viewing each of the two parts of plaintiff’s performance in isolation would be to fragment it artificially. (Democa v. Barasch, 212 Cal. 293 , 296-298 [ 298 P. 17 ]; Owen v. National Container Corp., 115 Cal.App.2d 21 , 28 [ 251 P.2d 765 ]; Abrams v. Guston, 110 Cal.App.2d 556 , 558 [ 243 P.2d 109 ]; Rench v. Harris, 79 Cal.App.2d 125 ,127 [ 179 P.2d 341 ]; cf. Marks v. Walter G. McCarty Corp., 33 Cal.2d 814 , 823-824 [ 205 P.2d 1025 ].) Obviously, the more favorable to defendants plaintiff’s “arrangements” with respect to the construction turned out to be the easier it would be for them to agree on other terms of the lease with the prospective lessee. Thus, by negotiating with the builder, plaintiff, realistically, helped negotiate the lease.
Defendants twice challenged the clarity of plaintiff’s allegations that he “made arrangements” for the building. Plaintiff has never explained the allegations. Instead, in his third amended complaint, he chose to ignore them. On this record the trial court was entitled to believe that plaintiff was unable to allege facts which would cast him in the role of a finder. Since plaintiff has never claimed that he can amend his complaint to allege that
The judgment is affirmed.
Stephens, J., and Aiso, J., concurred.
A petition for a rehearing was denied September 17, 1970.
Cases cited
- Hasekian v. Krotz 268 Cal.App.2d 311 at 316-317, at 317, at 312-324, at 319-323 p. 771, p. 772, p. 773
- Porter v. Cirod, Inc. 242 Cal.App.2d 761 at 766, at 762-766 p. 771, p. 772
- Apelian v. County of Los Angeles 266 Cal.App.2d 550 at 554 p. 771
- Rupp v. Kahn 246 Cal.App.2d 188 at 192 p. 771
- Weinstock v. Eissler 224 Cal.App.2d 212 at 225-226 p. 771
- Shaffer v. Beinhorn 190 Cal. 569 at 573-574 p. 772
- Davis v. Chipman 210 Cal. 609 at 619-620 p. 772
- Crofoot v. Spivak 113 Cal.App.2d 146 at 147-148 p. 772
- Palmer v. Wahler 133 Cal.App.2d 705 at 708-711 p. 772
- Freeman v. Jergins 125 Cal.App.2d 536 at 546-551 p. 773
- Rhode v. Bartholomew 94 Cal.App.2d 272 at 279-282, at 280 p. 773
- Batson v. Strehlow 68 Cal.2d 662 at 669 p. 773
- Hooper v. Mayfield 114 Cal.App.2d 802 at 805-809 p. 773
- Spielberg v. Granz 185 Cal.App.2d 283 at 290-292 p. 773
- Lamoreux v. San Diego & Arizona Eastern Railway Co. 48 Cal.2d 617 at 623 p. 775
- Wennerholm v. Stanford University School of Medicine 20 Cal.2d 713 at 716 p. 775
- Lee v. Hensley 103 Cal.App.2d 697 at 704 p. 775
- Reichert v. General Insurance of America 68 Cal.2d 822 at 836-837 p. 775
- Democa v. Barasch 212 Cal. 293 at 296-298 p. 775
- Owen v. National Container Corp. 115 Cal.App.2d 21 at 28 p. 775
- Abrams v. Guston 110 Cal.App.2d 556 at 558 p. 775
- Rench v. Harris 79 Cal.App.2d 125 at 127 p. 775
- Marks v. Walter G. McCarty Corp. 33 Cal.2d 814 at 823-824 p. 775