Moore and Co. v. T-A-L-L, Inc.

T-A-L-L, Inc. (TALL) (plaintiff) entered an exclusive listing agreement with Moore and Company, Inc. (Moore) (defendant). The agreement stated that upon Moore’s sale of TALL’s property, TALL would pay Moore a 10 percent commission on the purchase price. Moore broker H.L. Richison (defendant) handled the TALL listing. In February 1982, TALL accepted a purchase offer of $1.4 million from real estate company Newcomb-Weidner Company (N-W). Under the sale contract, closing was contingent on N-W’s ability to form a syndicate of purchasers by June. The sale contract also stated that TALL’s 10 percent commission was to be split equally between Moore and N-W. In March, a broker from Grubb & Ellis Company (Grubb) contacted Richison, stating that its buyer, DG Shelter Products Co. (DG), was offering $1.6 million for the TALL property. Without properly notifying TALL of the offer or obtaining necessary permissions from TALL, Richison disclosed the new offer to N-W, allowing N-W to reach an agreement to assign its purchase contract to DG for $300,000. The sale then closed with DG paying approximately $1.4 million to TALL. The 10 percent commission totaled approximately $140,000, with Moore retaining approximately $70,000, N-W receiving approximately $50,000, and Grubb receiving approximately $20,000. TALL was disadvantaged by the N-W/DG agreement because it lost opportunities to use the DG offer to drive up N-W’s purchase price or to enter a backup sale agreement with DG. TALL sued Moore and Richison for breach of fiduciary duty. The trial court held in TALL’s favor and ordered Moore to repay the $70,000 commission it had retained. The court of appeals altered the award, requiring Moore to return the full 10 percent commission of $140,000. Moore and Richison appealed.