Stern v. Gepo Realty Corp.

By the decision about to be made the respondent is to be paid real estate commissions as to which its agreement was "We the undersigned licensed brokers, do hereby agree to accept jointly the sum of Twelve hundred fifty ($1250.00) dollars as and for our commissions in connection with the sale, when and if consummated, * * *." (Emphasis supplied.) It is thus made clear that the writing upon which rests the respondent's right to commissions is an agreement burdened with a condition. As I view the present record, the fact that the condition was never fulfilled defeats the respondent's right to recover herein. (Aimes v. Wesnofske, 255 N.Y. 156, 162.)

I accept the Appellate Division's construction of the phrase "when and if consummated" as expressing the respondent's understanding that commissions were to be paid only if the agreement of purchase and sale was completely performed and title to the property involved actually passed. Concededly title never did pass — the sale never was "consummated." Furthermore, upon this record it cannot be said that failure to consummate the sale was due to any affirmative act by the seller. The single reason why the property was not conveyed was the presence on the law date of tax liens against the title, the validity of which liens was challenged by the seller. True, the seller was unsuccessful in his challenge. (Gepo Realty Corp. v. Pierce, 25 N.Y. Supp [2d] 25; affd., 260 App. Div. 1041; affd. [on appeal, by permission], 286 N.Y. 641.) But, on the agreed date for closing, the seller had offered to pay certain school taxes and water rents which had become liens upon the property, and to that end had offered to deposit in escrow a sum sufficient to pay not only those taxes, with any interest and penalties, but also a tax for a local improvement assessed against the property.

In the circumstances disclosed by this record the decisive rule has been stated by this court in Aimes v. Wesnofske (supra, p. 163): "* * * the duty of a vendor to his broker is fulfilled if he remain passive and neutral; the condition, upon which the payment of commissions is made to depend, is waived only where the vendor is active to prevent or hinder its performance."

Here the express condition — accepted by the respondent at the time of hiring — upon which payment of commissions was to depend, was concededly not fulfilled. In the absence of proof that the sale failed of consummation by reason of some active, affirmative conduct by the appellant, as seller, there is no legal basis for recovery of commissions by the respondent.

The order of the Appellate Division should be reversed and the judgment of the Trial Term affirmed, with costs in the Appellate Division and in this court. The first certified question should be answered in the negative and the second in the affirmative.

RIPPEY, CONWAY and DESMOND, JJ., concur with FINCH, J.; LEWIS, J., dissents in opinion in which LEHMAN, Ch. J., and LOUGHRAN, J., concur.

Order affirmed, etc.