Opinion Modified on Rehearing Oct. 30, 1956. See 303 P.2d 261.
[81 Ariz. 35] Jerry Giesler, Rexford Eagan, Beverly Hills, Cal., W. Francis Wilson and Kent A. Blake, Phoenix, for appellant.
Jennings, Strouss, Salmon & Trask, O. M. Trask, Phoenix, for appellees.
This is an appeal from (1) a judgment n. o. v. against plaintiff and in favor of defendant John C. Mullins, and (2) from a judgment in favor of John B. Mills and Bernice Mills, his wife, upon an instructed verdict by the court, and (3) from an order denying plaintiff's motion for a new trial as to these defendants. Defendant Mullins cross-appealed from an order denying defendant's motion for a summary judgment and motion for a directed verdict upon the ground that the contract for a commission was an illegal contract because the pleadings and evidence showed the plaintiff was not a licensed broker or dealer in securities under the Securities Act of the state of Arizona.
Plaintiff's cause of action is based upon an alleged oral agreement made in the early part of 1951 between John C. Mullins, defendant, and Albert Zugsmith, plaintiff herein, in which it is claimed Mullins engaged Zugsmith to procure a purchaser ready, able and willing to buy KPHO-TV and KPHO Radio Stations in Phoenix at a price acceptable to the owners. It was further claimed that Mullins, in entering into said oral agreement with Zugsmith, acted as agent for defendants Harber, Mills, Caldwell and Phoenix Broadcasting, Inc. The property was sold through Ed Meredith to the Merdith Engineering Company and the Meredith-Syracuse Television Company and a contract was executed by the parties for the purchase and sale thereof on April 29, 1952. The transfer of the property interest of defendants was made by the sale of all the stock of KPHO-TV and KPHO Radio Corporations to the purchasers. The purchase price was $1,500,000. Plaintiff claims he was the procuring cause of the sale and brought this action to recover commission therefor in accordance with his oral agreement with Mullins. The cause was tried to a jury.
At the close of plaintiff's case, upon motion of defendants, the court instructed a verdict against plaintiff and in favor of Doctor J. N. Harber and wife, Erskine Caldwell and wife, and Phoenix Broadcasting, Inc., and denied the motion as to John C. Mullins and John B. Mills and Bernice Mills, his wife.
The court again at the close of the entire case, in the course of submitting the case to the jury, instructed it to return a verdict [81 Ariz. 36] against plaintiff and in favor of defendants Doctor J. N. Harber, Mary Harber, Erskine Caldwell, June D. Caldwell, Phoenix Broadcasting, Inc., and John B. Mills and Bernice mills, submitting the case to the jury only as to John C. Mullins.
The jury returned a verdict in favor of plaintiff and against Mullins in the sum of $75,000. Thereafter, upon motion of defendant Mullins, the court ordered judgment n. o. v. against plaintiff and in favor of Mullins. Defendant also filed a motion for a new trial. The court did not rule upon the motion for a new trial. However, after the expiration of 20 days from the rendition of judgment, under the provisions of Rule 59(e), Rules of Civil Procedure, 1956, section 21-1308, A.C.A.1939, said motion for a new trial is deemed denied by operation of law.
In his first assignment of error Zugsmith, appellant herein, claims the court erred in granting judgment n. o. v. for defendant Mullins based upon the ground that the plaintiff did not have a broker's or dealer's license under the Arizona Securities Act and therefore could not legally represent defendants as agent or dealer in the sale of stock of the two corporations operating under the name of KPHO-TV and KPHO Radio Stations and consequently could not collect a commission for such sale. On the other hand it is urged by appellant that this type of transaction is specifically exempted from the operation of the Securities Act. Defendant, taking the opposite view, raised the same question of law on a cross-assignment of error. The two assignments of error will be treated together.
The fact is this type of transaction, so far as plaintiff is concerned, does not fall
within the operation of the act at all. We are of the view that the court committed reversible error in granting judgment to defendant Mullins n. o. v. upon the ground stated by it, first, because it is not alleged in the complaint, nor was it contended during the trial, that plaintiff sold the stock involved in this litigation. Under the contract alleged plaintiff did not agree to sell any stock for defendants. He agreed to procure a prospective purchaser for KPHO-TV and KPHO Radio Statutions who was ready, able and willing to buy them on the owners' terms. He bases his claims upon the ground only that he was the efficient, proximate and procuring cause of the sale of said stock and this was the theory upon which the case was tried and upon which the jury was instructed on the law of the case. Under all the evidence the owners made the sale to the purchasers of said stock and they chose the modus operandi of the transfer of their interest in KPHO-TV and KPHO Radio Statutions to the purchasers. They chose to assign their stock in the two corporations to the purchasers rather than to convey the physical property of the two stations by deed, bill of sale, etc. The owners [81 Ariz. 37] had a legal right to sell their stock in said corporations under the provisions of section 53-1405(c), 1952, A.C.A.1939 (A.R.S. § 44-1844). Therefore there was nothing whatever illegal about the transaction.
The only question then to be determined insofar as defendant Mullins is concerned is: Was there any substantial evidence from which a reasonable inference could be drawn to support the verdict of the jury? In other words, was there any substantial evidence supporting plaintiff's claim that he was the efficient, proximate and procuring cause of the sale of these properties (stock in these corporation) to the purchaser? If there was, the court erred in granting judgment for defendant n. o. v.
In arriving at a determination of this question we must consider the evidence most strongly in favor of sustaining the verdict of the jury. Glowacki v. A. J. Bayless Markets, 76 Ariz. 295, 263 P.2d 799.
Plaintiff testified that he came to Phoenix upon the telephonic request of Mullins to discuss the sale of KPHO-TV and KPHO Radio Stations; that a Mr. Gross of San Diego for whom he had been instrumental in selling a television station, had given Mr. Mullins his name as being the person responsible for the sale of the San Diego station. Mullins was not sure whether he called plaintiff or plaintiff called him. He was of the belief that plaintiff called him, however.
Plaintiff further testified that Mullins sent an employee to the airport to convey him to his office; that very soon after his arrival at defendant's office, Mullins launched into a discussion of the sale of these stations, the probable price for which they might sell in the market, the methods to be employed in procuring the best price available therefor and requested plaintiff to produce a purchaser ready, able and willing to buy at a price satisfactory to the owners and stated that they would pay him five per cent of the purchase price as commission therefor. Mullins later confirmed this by letter. Plaintiff suggested to Mullins that the best plan to be ...