| Thomas J. Hayes & Assoc., LLC v Brodsky |
| 2012 NY Slip Op 09134 [101 AD3d 1560] |
| December 27, 2012 |
| Appellate Division, Third Department |
| Thomas J. Hayes & Associates, LLC, Respondent, v Mark E.Brodsky, Appellant. |
—[*1] Tarshis, Catania, Liberth, Mahon & Milligram, PLLC, Newburgh (Rebecca BaldwinMantello of counsel), for respondent.
Spain, J. Appeal from an amended judgment of the Supreme Court (Gilpatric, J.), enteredSeptember 20, 2011 in Ulster County, upon a decision of the court in favor of plaintiff.
In this action, plaintiff seeks compensation for brokering the sale of real property purchasedby defendant. Plaintiff's principal, Thomas Hayes, a licensed automobile dealership broker fromConnecticut, contracted with Charles Saber to represent him in the sale of his Ford and Chevroletcar dealerships in the Town of Lloyd, Ulster County. Hayes contacted defendant's businesspartner who had previously informed plaintiff he was looking to purchase a dealership.Defendant was interested in buying the dealerships on the condition that he could also purchasethe land on which the dealerships were located; Saber did not own the land but leased it fromPerry Realty Company. The land was not for sale, but Hayes approached Michael Sylvester, ageneral partner of Perry Realty. Sylvester was initially reluctant, but eventually decided to sell.He was adamant, however, that he would not pay a brokerage fee. It is undisputed that, in thecourse of negotiating the purchase of the real estate from Sylvester, defendant agreed to acceptfinancial responsibility for paying plaintiff's commission. It is also clear, however, that Hayes anddefendant never reached an agreement as to the amount of the commission.
The real property was conveyed to defendant in June 2006[FN1]for $3,021,497 and, after refusing defendant's offer to pay a one percent commission, plaintiffcommenced this action against defendant alleging causes of action in breach of contract andquantum meruit for the failure to pay a broker's commission fee. Defendant moved for partialsummary judgment dismissing plaintiff's quantum meruit claim. Plaintiff opposed the motion andcross-moved for summary judgment on the same cause of action. Supreme Court (Cahill, J.)denied defendant's motion and granted plaintiff partial summary judgment on the issue ofliability under the theory of quantum meruit. The matter then proceeded to a nonjury trial, at theconclusion of which Supreme Court (Gilpatric, J.) found that no enforceable contract existedbetween the parties and, on the quantum meruit claim, that the reasonable value of plaintiff'sservices was five percent of the purchase price, amounting to $151,074.85, together with interestin the amount of $70,477 computed from the date of closing, for a total judgment in the amountof $221,551.85. Defendant now appeals, and we affirm.
While in his brief defendant asserts that he was entitled to summary judgment dismissingplaintiff's quantum meruit cause of action and that partial summary judgment to plaintiff on thatcause of action was precluded by unresolved issues of fact, at oral argument defendant concededliability on the quantum meruit cause of action.[FN2]Hence, as the first three elements of a claim for quantum meruit have been established, i.e., " '(1)performance of services in good faith, (2) acceptance of the services by the person for whom theywere rendered [and] (3) an expectation of compensation' " (Precision Founds. v Ives, 4 AD3d 589, 591 [2004], quotingClark v Torian, 214 AD2d 938, 938 [1995]), we need only review Supreme Court'sdetermination of " 'the reasonable value of the services performed' " (id.), the fourth andfinal element. When reviewing a judgment rendered after a nonjury trial, such as this, we "'independently review[ ] the weight of the evidence and may grant the judgment warranted by therecord, while according due deference to the trial judge's factual findings particularly where. . . they rest largely upon credibility assessments' " (Brightman v Hackett, 81 AD3d1200, 1200 [2011], quoting Cottonv Beames, 74 AD3d 1620, 1622 [2010]).
Here, Supreme Court credited plaintiff's expert, Joseph Bellavia, an experienced businessand real estate broker specializing in the automotive industry. Bellavia testified that a broker'scompensation in the automobile industry is based primarily on commission, with the majorobjective being the completion of the transaction, as compared to the actual time expended by thebroker, and that the customary rate of commission for the sale of real estate on which anautomotive dealership is situated is five percent to six percent of the sale price. Hayes also [*2]testified that his company received a five percent commission fromSaber for the sale of the dealerships and that he had never received a commission of less thanfive percent.
In contrast, defendant's expert, real estate broker and bank president George Whalen, opinedthat it would not be reasonable to apply a fixed percentage commission unless the parties madean agreement on that percentage but, "[i]nstead, the actual efforts of the broker should beevaluated and, if an agreement was [reached] and the broker was the cause of the sale, thoseefforts should be considered to award a commission commensurate with the broker's actualefforts." Relying on this opinion, defendant argues that Hayes did not spend any significantamount of time talking to defendant regarding the sale of the real estate and that defendantprincipally dealt directly with Sylvester in working out the details of the transaction. SupremeCourt declined to credit Whalen's testimony, however, finding that as he had no experience in thebrokerage of automobile dealerships or real property connected with a dealership, he "lacked theactual experience and or knowledge to render an expert opinion in this specialized transaction."Defendant does not directly challenge this determination, and we find no basis upon which toconclude that Supreme Court abused its discretion in not crediting defendant's expert (see Jackson v Nutmeg Tech., Inc., 43AD3d 599, 599-602 [2007]; McGillvery v City of New York, 22 AD3d 537, 538 [2005]).
We conclude that it was appropriate in determining the reasonable value of the servicesperformed by plaintiff to consider the commission it would have received had an agreement beenin place at the customary rate in the community during the time in which the services wererendered (see Comvest Consulting v W.R.S.B. Dev. Co., 266 AD2d 890, 891 [1999];Curtis Props. Corp. v Greif Cos., 212 AD2d 259, 265 [1995]; Nye Agency vNewman, 15 AD2d 728, 728 [1962]; Baer v Koch, 2 Misc 334, 335 [1893]; seealso Abrams Realty Corp. v Elo, 279 AD2d 261, 261 [2001], lv denied 96 NY2d 715[2001]). On appeal, defendant focuses heavily on the argument that he should not be bound to thecustomary rate of commission in the industry because no evidence exists that he was aware ofthat rate. Although this argument would be relevant to a contractual claim as to whether the courtshould supply a reasonable term omitted from an otherwise enforceable contract (compareMatter of De Graff, Foy, Conway & Holt-Harris v McKesson & Robbins, 31 NY2d 862, 871[1972]), the basis for liability here is premised on quantum meruit and, accordingly, defendant'sknowledge is immaterial as he is bound to pay plaintiff the reasonable amount of plaintiff'sservices, as determined by the trier of fact.[FN3]After carefully considering the record evidence and deferring to Supreme Court's credibilitydeterminations, we concur that plaintiff is entitled to five percent of the purchase price. In realestate transactions, the value of the services rendered are routinely measured as a percentage ofthe sale price, as opposed to the number of hours expended to broker the deal. It is undisputedthat Sylvester was not planning on selling the property before he was approached by Hayes andthat Hayes brought the parties together. Hayes also testified that when several problems arosewith the sale, he encouraged and convinced Sylvester to complete the transaction. [*3]Under these circumstances, we conclude that the reasonable valueof plaintiff's services was appropriately calculated (see Comvest Consulting v W.R.S.B. Dev.Co., 266 AD2d at 890).
Mercure, J.P., Malone Jr., Stein and McCarthy, JJ., concur. Ordered that the amendedjudgment is affirmed, with costs.
Footnote 1: The dealerships closed in thespring of 2006 and Saber paid plaintiff the agreed upon five percent commission, amounting to atotal of approximately $44,000.
Footnote 2: Neither party is challengingSupreme Court's finding that this dispute is not governed by an enforceable contract.
Footnote 3: In any event, defendantacknowledged that Hayes told him that he expected a five percent commission prior to thecompletion of the sale.