Irwin v. Mowbray — 24 N.Y. St. Rep. 751

Majority

p. 751

George W. Irwin et al., Resp’ts, v. Edward M. Mowbray, App’lt.

(City Court of Brooklyn,

General Term,

Filed May 27, 1889.)

Headnote

Brokers—Commissions.

The plaintiffs sue to recover their commissions as brokers, for securing purchasers for defendant’s lots. The vendor was to make a building loan, for which the purchasers were to give their bond and mortgage on the lots, the money to be advanced as the structure to be erected progressed. The purchasers were to give a satisfactory bond to vendor for the fulfillment of their contract. The purchasers failed to perform their contract. The defense was based on an alleged statement of plaintiffs to defendant, during the negotiation, that the purchasers had a certain sum of money, which was untrue, and seek to be relieved from their obligation to pay commissions on the ground that this was a breach of good faith from the broker to his principal. It appeared that plaintiffs knew the actual financial condition of the purchasers. Held, that plaintiffs were entitled to judgment.

F. A. Doyle, for pl’ff; J. T. Meareau, for def’t.

Plaintiffs (brokers), at the request of the defendant, secured purchasers for his vacant lots.

A contract was signed by the parties, but, being unsatisfactory to defendant, the next day another contract was executed, and delivered, by the terms of which the price was $17,500, for which purchasers were to give their bond and mortgage on the lots. The vendor was to make a building loan of $10,000, for which purchasers were to give their bond and mortgage on the lots, the money to be advanced as the structure progressed. The purchasers were to give a bond satisfactory to vendor, for the fulfillment of their contract. Such bond was given and accepted by vendor. The purchasers failed to fulfill their contract.

The plaintiffs sue to recover the balance of their commissions. The defense is based on an alleged statement of plaintiffs to defendant, during the negotiations, that the purchasers had four or five thousand dollars in money, which was known to them to be untrue.

The contention is that this was a breach of that good

p. 752

faith due from the broker to his principal, which ought to-relieve the vendor from his otherwise admitted obligation to pay commissions, even if the statement did not influence the vendor in the least, and even if vendor knew the purchasers had no money, and so uninfluenced by such statement, and with full knowledge of their financial condition, used and accepted the benefits of the services of the brokers.

The _ principle upon which the maxim of “ uberrima fides ” is founded, has never been stretched to the extent of rewarding the bad faith and dishonesty of the principal by relieving him from the obligation of paying commissions under such circumstances. The fact that to the second or final contract was added a clause, requiring purchasers to-give a satisfactory bond for the fulfilment of their contract, would tend to indicate that the vendor knew the actual financial condition of the parties, and besides one of the plaintiff’s testified that the purchasers, in his presence, informed plaintiff of their condition in that respect. The-court properly refused, on the conflict in the evidence, relating to the circumstances surrounding this alleged misrepresentation, to charge, without qualification, that if plaintiffs made such statement, knowing the same to be untrue, they cannot recover. The court had already correctly instructed the jury on this point in his charge.

For these reasons the judgment and order must be affirmed, with costs.

Osborne, J., concurs.