TRYON REALTY CO. OF NEW BERN, INC. v. Hardison

302 S.E.2d 895 (1983)

TRYON REALTY CO. OF NEW BERN, INC. v. L.H. HARDISON and wife, Frances Nelson Hardison; R.B. Nelson and wife, Rhunell G. Nelson; Joseph C. Nelson and wife, Mary E. House Nelson; H.W. Broughton and wife, Martha Nelson Broughton; John C. Coughlan and wife, Margaret Nelson Coughlan; and J.C. Galloway and wife, Christine Nelson Galloway.

No. 823SC652.

Court of Appeals of North Carolina.

June 7, 1983.

*897 Sumrell, Sugg & Carmichael by Fred M. Carmichael and Rudolph A. Ashton, III, New Bern, for plaintiff, appellant.

Gaylord, Singleton, McNally & Strickland by Louis W. Gaylord, Jr. and Danny D. McNally, Greenville, and Lee, Hancock, Lasitter & King by C.E. Hancock, Jr. and John W. King, Jr., New Bern, for defendants, appellees.

HEDRICK, Judge.

The question presented by this appeal is whether the trial court erred in granting the defendants' motion for a directed verdict.

Plaintiff argues that it offered evidence at trial that tended to show that it complied fully with the terms of the 31 August 1978 agreement (hereinafter referred to as the Agreement) in that it produced a purchaser who was ready, willing and able to purchase *898 defendants' property according to the terms specified by defendants, that the sale was not consummated because defendant could not produce good title, and that plaintiff is therefore entitled to recover the commission specified in the Agreement.

Defendants argue that plaintiff's evidence shows as a matter of law that it did not comply with the terms of the Agreement in that the sale of defendants' property was never consummated and there was therefore no twenty-eight percent down payment by the purchaser from which plaintiff's commission could be paid.

It is well established in North Carolina that when a broker, pursuant to an agreement with the owner of certain real property, procures a purchaser for that property who is ready, willing and able to buy the property upon the terms offered, he is entitled to his commission. Carver v. Britt, 241 N.C. 538, 85 S.E.2d 888 (1955). The right of the broker to his commission is not affected if the principal voluntarily cancels the contract that the broker negotiated, Ross v. Perry, 281 N.C. 570, 189 S.E.2d 226 (1972), or is unable to fulfill the terms on his part or produce good title, or if the sale fails of consummation upon the fault of the seller. Crowell v. Parker, 171 N.C. 392, 88 S.E. 497 (1916).

When the broker's right to his commission is made to depend upon the satisfaction of any condition other than his production of a ready, willing and able purchaser, North Carolina courts require that such a variation from the general rule be clearly expressed. Ross v. Perry, 281 N.C. 570, 189 S.E.2d 226 (1972); Jones v. Realty Co., 226 N.C. 303, 37 S.E.2d 906 (1946).

It is important in such situations that a distinction be made between language that imposes a condition which goes to the substance of a contract and language which relates only to its ultimate performance. Carver v. Britt, 241 N.C. 538, 85 S.E.2d 888 (1955); Harrison v. Brown, 222 N.C. 610, 24 S.E.2d 470 (1943).

In the present case, defendants assert that the Agreement with plaintiff was a special brokerage contract in that it contained provisions requiring payment of the commission only upon delivery of the deed and that this payment was to come from the down payment of twenty-eight percent of the purchase price to be received from the purchaser. Defendants contend that the language in the agreement makes plaintiff's right to the commission contingent upon delivery of the deed and payment of the down payment.

In support of their contention, defendants cite us to the case of Jones v. Realty Co., 226 N.C. 303, 37 S.E.2d 906 (1946), wherein the Supreme Court affirmed the trial court's judgment of nonsuit, denying a broker's right to his commission. However, we find Jones to be clearly distinguishable. There, the court held that the trial court's judgment was grounded on a special contract, prepared by the broker, where the sale failed because of the inability of the purchaser procured by the broker to complete it.

The Jones court noted that the case before it was "not like the usual broker's action where a responsible purchaser is procured by [the broker's] efforts under a general contract, express or implied." Id. at 305, 37 S.E.2d at 907 (citations omitted). In that case, the court based its finding of a special contract on the language of a letter, found to be a part of the contract, which read, "When the deal is closed up we will pay Frank F. Jones his commission of 5%... out of the sale price of the property." Id. at 304, 37 S.E.2d at 907. The Jones court found that this language was clear enough to leave no question as to the intention of the parties to impose a condition on the broker's right to his commission and thereby create a special contract. 226 N.C. 303, 37 S.E.2d 906.

The Jones case is further distinguishable from the case before us. There it was the purchaser procured by the broker and not the seller, as in this case, whose inability to *899 comply with the contract caused the sale to fail.

We find that the Agreement in the present case is a general contract. The language upon which defendants base their contention does not condition plaintiff's right to his commission. Rather, we find that the language in question goes merely to the time and manner of the payment of the commission.

We therefore hold that the evidence, when considered in the light most favorable to plaintiff, is sufficient to require submission of the case to the jury and that the trial court erred in directing a verdict for the defendants.

Reversed and Remanded.

VAUGHN, C.J., and EAGLES, J., concur.