Dickerson Realtors, Inc. v. Frewert

Citations: 307 N.E.2d 445; 16 Ill. App. 3d 1060; 1974 Ill. App. LEXIS 3200Docket: 72-276

Court: Appellate Court of Illinois; January 23, 1974; Illinois; State Appellate Court

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Plaintiff Dickerson Realtors, Inc. sued defendants William H. Frewert and others to recover a real estate commission based on an implied contract after securing a potential buyer for the defendants' home. The circuit court ruled in favor of the defendants, finding no implied contract. The central issue on appeal was whether this decision was against the manifest weight of the evidence.

The evidence showed that the defendants initially listed their home with another broker at $44,700 before attempting to sell it themselves. On April 21, 1971, Mrs. Jan Carlson, a saleswoman for the plaintiff, obtained permission from Mrs. Frewert to show the home to prospective buyers, the Coopers. After viewing the property, the Coopers made an offer of $42,500, which Mrs. Carlson communicated to Mr. Frewert later that day. During the call, Mr. Frewert indicated he would not accept less than $40,500 net and suggested adjusting the commission accordingly. He also requested a provision for an additional 30 days of possession at a rental rate of $30 per day.

Mrs. Carlson discussed the commission issue with her supervisor, Mr. Dickerson, who stated that adjusting the commission was against company policy. Subsequently, she negotiated a revised offer of $43,550 with the Coopers, which included the requested rental provision. However, when Mrs. Carlson contacted Mr. Frewert again that evening about the new offer, he stated he would not make a decision. The appeal ultimately challenges the trial court's ruling on the existence of an implied contract based on the discussions and negotiations between the parties involved.

Mrs. Carlson informed Mr. Frewert that she would deliver papers to Mrs. Frewert at the bus depot for her trip to Chicago, where she was to meet Mr. Frewert. During their conversation, Mr. Frewert indicated he considered the matter closed. The following morning, Mrs. Carlson delivered the Coopers' second offer, a check, and a sales agency contract to Mrs. Frewert, who promised to return by 6:00 P.M. That day, the defendants made an offer on a Chicago residence, which was accepted. Mr. Frewert then contacted Mr. Cooper directly, agreeing to sell their Rockford house for $41,500 in cash without contingencies, with possession on June 15. The written agreement was executed on April 24, 1971, including a clause indemnifying the Coopers against real estate commission liability.

Later that evening, Mrs. Carlson learned from Mrs. Frewert that Mr. Frewert intended to call her, which he did. He expressed a desire to bypass the realtor and deal directly with the Coopers. Mr. Dickerson was informed by Mr. Cooper about Mr. Frewert's call. Following this, Mr. Dickerson spoke with Mr. Frewert, who felt that his attempts to reduce the commission were unsuccessful and indicated dissatisfaction with the plaintiff's representation. He noted that had the property been sold while listed with another broker, the commission would have been less, and he was unwilling to negotiate further. 

The document highlights that a contract of employment is necessary to establish an agency relationship between a broker and a property owner, but no specific form is required; consent can be implied through conduct. The defendants were aware that the plaintiff, a real estate broker, expected a commission upon the sale, as they had allowed her to show the property to the Coopers. Mr. Frewert initially indicated a need to adjust the brokerage commission to achieve a net price of $40,500. Despite Mrs. Carlson's efforts to secure a higher offer of $43,000, the next day the Frewerts directly negotiated with the Coopers and agreed to sell their property for $41,500, thus excluding the broker from any commission liability.

A contract of employment is implied to exist between the plaintiff and defendants, as the plaintiff successfully introduced the Coopers, who subsequently entered into a sale agreement with the defendants shortly after the plaintiff communicated the Coopers' offer. The plaintiff's actions as a real estate broker were integral to the sale, which the defendants attempted to circumvent to avoid paying a brokerage commission. Legal principles of equity govern the right to recover on a quasi-contract, ensuring that one party does not unjustly benefit at another's expense. Despite the defendants' claims that they aimed for a "reasonable value" for the plaintiff's services, evidence showed that they sought a net price of $40,500 and engaged in direct negotiations with the Coopers, undermining the plaintiff's opportunity to secure the commission. The customary brokerage commission in Rockford is established at 7%, and the plaintiff sought $2,905 based on the sale price of $41,500. The court ruled in favor of the plaintiff, affirming the right to the full commission and reversing previous judgments against the plaintiff. Judgment was entered for the plaintiff accordingly.