Appeal from Circuit Court, Multnomah County. Richard L. Burke, Judge.
Hardy Myers, Jr., Portland, argued the cause for appellant. With him on the briefs were Rives, Bonyhadi & Hall, Portland.
Joseph W. Glaze, Portland, argued the cause and filed a brief for respondent.
Tongue, Justice. O'Connell, Chief Justice, and Denecke, Holman, Howell and Bryson, Justices.
This is an action by a realtor for $50,000 in profits allegedly lost as the result of the termination by defendant of an exclusive "net price" listing agreement for the sale of two motels owned by defendant. Defendant's answer alleged, as an equitable defense, that plaintiff, as a real estate broker, breached his fiduciary duty to defendant both before and after the execution of the listing agreement. The trial court agreed and entered findings of fact to that effect. We affirm.
Plaintiff, as a realtor, specialized in exchanges of commercial property. In 1965 defendant, the owner of 25 acres of unimproved land near the Troutdale Airport, responded to one of plaintiff's advertisements and listed it for sale by plaintiff for some $63,000.
Plaintiff then prepared a "package" on the property and presented it to a meeting of a realtor's "exchange club."
As a result of plaintiff's efforts, the Golden Rule Realty Company ("GRR") became interested in purchasing the property with third party promissory notes secured by trust deeds on Nevada property. A sale was then consummated on that basis. No one checked the validity of the trust deeds, defendant being unfamiliar with them and plaintiff relying upon the escrow company to check them on closing the transaction. However, because plaintiff was not familiar with trust deeds and apparently had some doubts about GRR, he required defendant to give him a "hold harmless" agreement. As a commission plaintiff accepted a $4,000 note from GRR and a Thunderbird car from defendant which, along with the Troutdale property, was subject to a bank lien which GRR was to pay off.
Before that transaction was closed, however, plaintiff undertook negotiations on behalf of GRR which resulted in an exchange of the Troutdale property (being purchased by GRR from defendant) to Associated Thrift and Securities, Inc. (AT) for two motels in Portland -- the Sixth Avenue Motel and the Fourth Avenue Motel (or Saharan). Plaintiff was engaged by GRR to investigate other properties on its behalf and also sold to GRR property owned by him in Klamath county.
As compensation for his services to GRR plaintiff received from it a promissory note for $50,000 secured by an assignment of GRR's interest as a purchaser of the Sixth Avenue Motel from AT. Plaintiff testified that the arrangement was also intended to provide additional security for the sale of his interest
in the Klamath property and for the $4,000 note for commission on the ...