Albany County NyArchives Court.....Barkley, George Vs. Dudley Olcott 1889
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Source: Reports Of Cases - New York
Written: 1889

Third Department, May Term, 1889

GEORGE BARKLEY, Appellant, v. DUDLEY OLCOTT, J. HOWARD KING and ABRAHAM VAN 
VECHTEN, Respondents.

Principal and agent — exclusive authority to sell real estate at a fixed sum — 
offer of the property by the principal at a less price — what must be shown to 
justify a recovery of commissions by the agent — estoppel.

The plaintiff's assignor on December 12, 1887, was given by the defendants, the 
owners of certain iron furnaces, the exclusive privilege for six months, unless 
previously revoked by a notice of thirty days, to sell such furnaces for 
$125,000, upon a commission of $5,000. He did not effect a sale, but brought an 
action to recover his commission, alleging that the defendants, by offering the 
property for sale for $100,000, had "broken the market" upon him and thus 
deprived him of the opportunity to earn his commission:

Held, that it rested upon the plaintiff to show that there was a market for the 
property, and that it could have been sold, and that his ability to sell the 
property was affected by the alleged offer thereof by the defendants at a lower 
price.

The plaintiff's assignor wrote to the defendants, stating that his only offer at 
that date was one from Messrs. Weed, Clark & Weston, who would like to lease for 
six months with the privilege to buy, and saying, further, "So I leave this 
matter in your hands now. I have brought it to a focus and leave you to arrange 
with Mr. G. B. Clark, 52 Wall street, New York, and know, if it goes through, 
you will pay me what is right for commission, etc.; and if it does not go 
through, and you sell elsewhere, you will then send me a check for my time, 
trouble and expenses up to date."

Held, that the defendants were entitled to act upon this letter, and to assume 
that the transaction stated therein was the final one respecting the sale of the 
property by the plaintiff's assignor, and that he left its further charge in 
their hands, and in case of its failure permitted them to sell the property 
elsewhere.

Appeal by the plaintiff from a judgment dismissing the plaintiff's complaint on 
the merits, entered upon the verdict of a jury at the Albany Circuit, rendered 
by direction of the court in favor of the defendants, which judgment was entered 
in the office of the clerk of the county of Albany on the 28th day of December, 
1888.

The action was brought to recover damages arising from the alleged breach by the 
defendants of an agreement in writing, under date of December 12, 1887, by which 
Austin G. Gorham, the assignor of the plaintiff, was given the exclusive 
authority to sell certain blast furnaces on the island south of the city of 
Albany, and was to receive $5,000 in case he effected a sale. The instrument of 
authority provided as follows: "You are hereby authorized by the undersigned, 
purchasers and owners of the works and plant * * * and are hereby given 
exclusive authority to sell the said works and plant (formerly of the Albany 
City Iron Company) for the sum of one hundred and twenty-five thousand dollars 
($125,000). This authority is to continue in force for six months, unless 
previously revoked, and is only to be revoked before the expiration of said time 
by a notice of thirty days of an intention and desire to revoke and terminate 
this authority, to be personally served on you."

On April 3, 1888, a letter was written by Austin G. Gorham to the defendants, as 
follows:

"Gentlemen. — My only offer at this writing is one from Messrs. Weed, Clark & 
Weston, trustees for the Hudson Ore and Iron Company at Burden Station, N. Y., 
who would like to lease for six months, with privilege to buy. I believe that if 
you lease to them, as they suggest, they probably would buy. They say they will 
not buy without leasing first. They will probably pay fifty cents a ton lease on 
the output of furnaces during time of lease. I must go to Denver at 1.15 p. m. 
to-day to attend a stockholders' meeting there on Saturday, so I leave this 
matter in your hands now. I have brought it to a focus, and leave you to arrange 
with Mr. G. B. Clark, 52 Wall street, New York, and know, if it goes through, 
you will pay me what is right for commissions, etc., and if it does not go 
through and you sell elsewhere, you will then send me check for my time, trouble 
and expenses up to date."

It was claimed by the plaintiff that the defendants, during the period of time 
for which he had the exclusive authority to sell the works and plant above 
mentioned, offered the same for $100,000, and thus "broke the market" upon him.

George B. Wellington, for the appellant. 

Marcus T. Hun, for the respondents. 

Landon, J.:

Gorham, the plaintiff's assignor, had a contract with the defendants, whereby he 
was given the exclusive privilege for six months from December 12, 1887, subject 
to be revoked by a notice of thirty days, to sell a certain iron-making 
establishment of the defendants for $125,000, upon a commission of $5,000. He 
did not effect any sale, but brings this action to recover his commission, 
alleging that the defendants by their action "broke the market" and thus 
deprived him of the opportunity to earn his commission. The trial court, at the 
close of the case, directed a verdict for the defendants.

The testimony, taken in the favorable light in which plaintiff's counsel states 
it, is that about March 20, 1888, a committee of three persons proposed to 
Gorham to hire the property for six monfhs, with a right to buy it at $125,000 
at the end of that period. What the conversation between Gorham and this 
committee was, does not appear, but Gorham testifies that he then went to the 
defendant King and stated to him, in the presence of the other defendants, that 
the committee had told him that they had been offered the property at $100,000, 
and that Mr. King admitted that he had told a gentleman in New York, a Mr. 
Mould, that the property was in Mr. Gorham's hands for sale at $125,000, but 
that the defendants would accept $100,000 for it. Mr. King denied this 
conversation, but admitted he had said to Mould that he would be glad if a 
purchaser could be found at $100,000. Gorham testified that the offer to sell at 
$100,000 ruined the market at $125,000.

It does not otherwise appear that there was any market of the property at 
$125,000, or even at $100,000. The nearest approach to a market at $125,000, 
shown by the evidence, was the proposed option of the committee, to be 
determined after the experimental lease of six months. No one testified that the 
committee had said that the property had been offered to them at $100,000, or 
that if they made the statement they had any foundation for it, or that the 
remark of Mr. King had reached them. There is no evidence that the conversation 
between Mr. King and Mr. Mould ever reached the market or any intending 
purchaser. Before a jury would be justified in finding that such a remark 
prejudiced Mr. Gorham, there ought to be some evidence tending to show that he 
probably had or could have found a market at $125,000, and that the remark 
reached it.

We may concede that such a remark, if not contradicted, would ruin the market at 
$125,000, but a jury ought not to find that there was a market thus ruined, in 
the absence of evidence tending to show it, and in the presence of evidence, 
which the case affords, tending strongly to show that there was no such market. 
The result of the conversation between Gorham and the defendants in March was, 
that on March 23, 1888, Gorham had solicited and obtained the right for ten days 
to sell the property for $100,000. On the 3d of April, 1888, he wrote the 
defendants, "my only offer at this writing is one from Messrs. Weed, Clark & 
Weston" (the committee above mentioned), "who would like to lease for six 
months, with privilege to buy, * * * they will not buy without leasing first." 
The letter then stated that he was obliged to leave for Denver, and added: "So I 
leave this matter in your hands now; I have brought it to a focus and leave you 
to arrange with Mr. B. G. Clark, 52 Wall street, N. Y., and know that if it goes 
through you will pay me what is right for commissions, etc., and if it does not 
go through, and you sell elsewhere, you will send me check for my time, trouble 
and expenses to date." No arrangement was completed with this committee, and the 
defendants on April 7, 1888, sent a formal notice to the plaintiff terminating 
his authority, and gave authority to Mr. Mould to sell the property at $100,000, 
subject to Mr. Gorham's rights if he had any.

The defendants certainly had the right to act upon Mr. Gorham's letter of April 
third, and to assume that the transaction he was negotiating was his final one 
respecting the sale of the property, and that he left its further charge in 
their hands, and in case of its failure permitted them to sell the property 
elsewhere. The net result is that Mr. Gorham failed to market the property and 
has failed to show that he did so through the fault or misconduct of the 
defendants. It does not appear that the property has since been sold, and, 
therefore, no case is presented in which the defendants have, in any way, been 
benefited by Gorham's efforts. We think that in no reasonable aspect of the case 
would the jury have been justified in finding for the plaintiff.

Ingalls, J., concurred; Learned, P. J., not acting.

Judgment affirmed, with costs.

Additional Comments:
Reports of Cases Heard and Determined in the Supreme Court of the State of New 
York. Marcus T. Hun, Reporter. Volume LIX, 1889, HUN 52. Banks & Company, 
Albany, NY. 1901.

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