Peeler Insurance & Realty, Inc. v. Harmon

200 S.E.2d 443 (1973) 20 N.C. App. 39

PEELER INSURANCE & REALTY, INC.
v.
Fred HARMON.

No. 7327SC640.

Court of Appeals of North Carolina.

November 28, 1973.

Yelton & Lamb, P.A., by Robert W. Yelton, Shelby, for plaintiff appellant.

Whisnant & Lackey by N. Dixon Lackey, Jr., Shelby, for defendant appellee.

BRITT, Judge.

Did the court err in allowing defendant's motion for directed verdict and dismissing the action? We hold that it did.

Brokerage contracts can be classified both as to type of listing and method of payment to the broker. The former category may be subdivided into two groupings: those in which the listing is exclusive and those in which the listing is nonexclusive. Likewise the latter category may be subdivided into two groupings: those in which the broker is to receive a percentage of the purchase price and those in which the broker is to receive everything he can get over a certain amount.

Our research fails to disclose a case from an appellate court of this State involving an exclusive listing contract. However, by stating that the particular contract in question was not an exclusive listing contract, it would appear that our Supreme Court has recognized the existence of this classification by implication. Thompson v. Foster, 240 N.C. 315, 82 S.E. 2d 109 (1954) and Sparks v. Purser, 258 N.C. 55, 127 S.E.2d 765 (1962).

We are faced with the question, does the principal breach his contract by selling in competition with his broker who has an exclusive listing? Before we can reach this question, however, we must first determine the nature of the exclusive listing in this case. R. Lee, North Carolina Law of Agency and Partnership, § 38, p. 54 (3d ed. 1967) indicates two types of "exclusive agencies." The first of these is the true "exclusive agency," and is denominated as such, which, ". . . precludes the principal from hiring another agent to sell the same property, but it does not preclude principal himself from procuring a customer without paying compensation." The second of these is properly denoted an "exclusive right to sell" and ". . . precludes the principal himself from competing with the agent."

Although the term "exclusive right to sell" appears in the portion of the contract in the case at hand quoted above, a reading of the cases of other jurisdictions leads us to believe that mere use of this term should not be determinative. Since the right of alienation has become such an integral part of property, it is only proper that the contract specifically negative this right before it is lost. See Annot., 88 A. L.R.2d 936 (1963) for a listing of cases so indicating.

This brings us to the question of whether the terms in this contract specifically negative the right of defendant to sell his property in competition with his broker during the term of the contract. We feel that they do and that such a holding is compatible with the general theory of the law of this State as evidenced by those cases dealing with nonexclusive listings. The clear meaning of the second quoted paragraph is that if the property were sold by anyone, including the principal, at any terms accepted by the principal, to someone with whom the agency had negotiated, then the agency would be entitled to compensation. In DeBoer v. Geib, 255 Mich. 542, 238 N.W. 226 (1931), "If said property is sold . . . by you, by myself or any other person . . .," was interpreted as giving an exclusive right to sell. A similar passage was so interpreted in Rubin v. Beville, 132 So.2d 783 (Fla.App.1961). See also Annot., 88 A.L.R.2d 936 (1963) for other cases so holding. The sale in this case clearly falls within the terms of the contract.

While the facts in Realty Agency, Inc. v. Duckworth & Shelton, Inc., 274 N.C. 243, 251, 162 S.E.2d 486, 491 (1968), are quite different from those in the case at hand, our holding finds support, albeit in a negative way, in the following language by Justice Sharp: "* * * This is not a situation in which an owner, who has listed real estate with the broker at a specified price, reduces the price and sells it to the broker's prospect. When that occurs, clearly the broker is entitled to compensation. (Citations.)" See also Aiken v. Collins, 16 N.C.App. 504, 192 S.E.2d 617 (1972).

We conclude that plaintiff's evidence was sufficient to withstand defendant's motion for directed verdict. The judgment appealed from is

Reversed.

BROCK, C.J., and CAMPBELL, J., concur.