so that it becomes necessary to know who is and who is not a broker.

A broker is a person engaged in the negotiation of contracts. Persons whose business it is to bring buyer and seller together (Keys v. Johnson, 68 Pa. 43). A real estate broker is one who engages in the purchase and sale of real estate as a business and occupation and holds himself out to the public in that character and capacity (Chadwick v. Collins, 26 Pa. 138).

192. Real Estate Broker Must be Licensed.

By act of assembly (April 10, 1849, P. L. 573, Sec. 8) in Pennsylvania all real estate brokers must be licensed. This license is isued by the county treasurer and may be obtained upon application to the treasurer of the county wherein the applicant resides and does business. The license authorizes the broker, under the seal of said county to exercise his occupation for the term of one year from the date of the commission. Each and every succeeding year he must pay a new license fee and obtain a new license. Real estate brokers must pay fees for the licenses depending upon the amount of business they do. By Act of April 15, 1850 (P. L. 772), as amended by Act of June 7, 1901, P. L. 534, Sec. 1, they must pay for use of the Commonwealth a tax equal to 3% of their total business, in addition to the license fee, and this whether the business is carried on by individuals, firms, or corporations (Act of April 14, 1905, Sec. 1, P. L. 161). The mercantile appraisers are required to appraise the amount of business and assess said brokers accordingly, just as persons engaged in mercantile business.

In Philadelphia, this is usually done by the mercantile appraisers distributing blanks ten days before the time of return, which blank the broker is required to fill out and set forth under oath the volume of business he does.

193. Effect of Not Obtaining a License.

If a real estate broker is not properly licensed one of the serious effects that follows is, that he cannot recover his commission should he be compelled to sue therefor. The license must be obtained and tax paid before the transaction sued on; a subsequent compliance with the law by the broker will not cure a previous illegal transaction (Luce v. Cook, 227 Pa. 224). Not every person who sells real estate for another is necessarily

such a broker within the meaning of the act as to require him to be licensed. An occasional or casual sale does not make the negotiator thereof a broker. So it was said in a case (Chadwick v. Collins, 26 Pa. 138) that any person may lawfully employ one who is not a real estate broker to buy or sell real estate, and where such employment takes place it must be paid for. The test seems to be whether or not the person is engaged in the business of real estate broker, not whether he makes a sale of real estate. In the case of Woods v. Heron (229 Pa. 625), the Supreme Court said, "A person suing for commission on sale of real estate will not be barred from recovery by reason of not having a broker's license, where there is no evidence that he was doing business as a real estate broker at the date of the contract set up by him.

194. When a Broker Is Entitled to His Commissions.

A real estate broker has earned his commission when he procures a party with whom his principal is satisfied, who actually contracts for the property at a price satisfactory to the owner even though the purchaser afterward attempts to avoid the contract (Buchfield v. Griffith, 10 Sup. Ct. 618; Holmes v. Neaffi, 151 Pa. 392; Hipple v. Laird, 189 Pa. 472). Where a sale has resulted from the efforts of the broker, even where such efforts amounted to a mere introduction of the property to the buyer, whether by advertisement or sign, he is entitled to his commissions (Keys v. Johnson, 68 Pa. 42). Says the Superior Court (Peters v. Holmes, 45 Superior Ct. 278), "It is not material that the sale was made directly with the owner if the broker brought the parties together and a sale resulted from the broker's intervention." "When a real estate broker is duly authorized to sell property by a private sale and has commenced negotiations with a purchaser the owner cannot, while such negotiation is pending, take it into his own hands and complete it, either above or below the price first mentioned, and refuse to pay commissions (Warne v. Johnson, 48 Sup. 98). Where a broker is employed to negotiate a loan he is entitled to his commission when he brings to his principal a party ready and willing to take the loan (Fenn v. Dickey, 178 Pa. 258). If a sale fails because the vendor is unable to make title, his broker is nevertheless entitled to his commissions (Kifer v. Yoder, 198 Pa. 308). An owner, who promises to pay a broker commissions if he sells his prop

erty at a certain price, and refuses to sell when the broker produces a purchaser willing to buy at that price, is nevertheless nable for the commissions (Miller v. Kenneck, 20 D. R. 706).

An agreement under seal by the vendor promising to pay a commission to an agent, whether the sale be made by him or any other person is valid and binding, the court holding that the seal imported a consideration and that the mere harshness of the bargain was no defense (Ownes v. Werle, 14 Sup. Ct. 536).

195. When a Real Estate Broker is Not Entitled to Commissions.

Before a real estate broker is entitled to his commissions there must, of course, be sale, although this does not mean that a sale must be consummated by him; it is enough if he brings the parties together and sale is consummated directly by the parties. A broker employed to sell real estate is entitled to his commissions when he has procured a purchaser satisfactory, bona fide, to the vendor, with whom a valid enforceable agreement of sale is executed even though afterwards the vendee refuses to take title (Hipple v. Laird, 189 Pa. 472; Seabury v. Insurance Co., 205 Pa. 234; Taylor v. Foltz, 24 Pa. Super. 1). But it seems, not unless some purchase money is paid on account which the vendor has forfeited (Schurr v. Warnick, II D. R. 1).

A real estate broker must not be disloyal or he forfeits his right to commissions. Thus, where a broker concealed from his principal the name as well as the fact that a purchaser was the owner of an adjoining lot so that said principal would not raise his price, the court held the broker was not entitled to his commissions (Wilkinson v. McCullough, 196 Pa. 205).

Another and more familiar example of disloyalty is where a broker secretly represents both seller and buyer. An agent must not act for both parties. If he attempts to represent both vendor and vendee without disclosing to them that he so represents them, he cannot recover his commissions from either (Addison v. Wanamaker, 185 Pa. 536; Marshall v. Reed, 32 Pa. Superior Ct. 60). Subsequent ratification like prior permission excuses the misconduct and entitles the broker to his commission as against the one who condones the misconduct (Moore v. Grow, I Sup. Ct. 125). If an agent is to represent both parties it must be expressly agreed by them to pay him a commission before he can recover (Maxwell v. West, 23 Pa. C. C. 302).

Unless the broker who brought about the sale was actually employed to act by the owner he cannot recover against him (Wireman's Estate, 43 W. N. C. 334; Samuels v. Luckenbach, 205 Pa. 428; Henderson v. Sonneborn, 30 Pa. Superior Ct. 182). When a real estate broker's employment is by its terms not exclusive and his commissions are made conditional upon the actual securing of a signature to a lease and a down payment thereon, commissions are not earned by the broker merely bringing together the owner of the property and a prospective tenant (Barber v. Miller, 41 Superior Ct. 442).

196. Relation of Real Estate Broker to Client Regarded by Law as a Confidential One.

The relation of a real estate broker to his client is a confidential one and, therefore, he must be loyal and steadfast in his allegiance. Aside from the penalty inflicted by law upon a disloyal agent it is to the best interest of a broker to make as advantageous bargain for his client as possible, otherwise he will soon find himself discredited and his business ruined. An agent who deliberately buys from a client through a straw man and re-sells to a purchaser for a higher price is guilty of a gross fraud, the discovery of which will inevitably result in destroying his business reputation, while he will be compelled by the court to return his ill-gotten gains. The courts of equity are prompt to give relief when such a betrayal of confidence takes place, no matter under what device concealed (Power v. Black, 159 Pa. 153). No agent ought, therefore, ever purchase from his principal unless he does it openly and not even then if he does it merely for the purpose of re-selling to a person whom he knows is desirous of purchasing.

197. Authority of Real Estate Agent to Act.

The general rules of the law of agency apply to real estate agents. In other words, he has not only such authority as his principal expressly gives him, but also such as is apparently conferred upon him by conduct of his principal. Thus, where a real estate broker acts contrary to his instructions, his principal will be bound by such acts as are within the scope of the authority which the agent was held out to the world to possess (McNeile v. Cridland, 168 Pa. 16; Grasseli Chemical Co. v. Biddle Co., 22 Pa. Superior Ct. 426). So, too, an act done in

excess of authority, if ratified either expressly or by conduct becomes just as binding upon the principal as though he previously authorized it. Thus, where an agent sells for a less price than that fixed by the owner, if the owner accepts the deposit money knowing of his agent's violation of instructions, he is held to have ratified the bargain. It has been held (Phila. Trust Co. v. Roberts, 14 W. N. C. 123; Cavanaugh v. Buehler, 120 Pa. 441), in case of a loss through embezzlement, where an agent negotiating a loan is agent for both lender and borrower that the lender should suffer in preference to the borrower because he permitted the transaction to be conducted in such a way as to give opportunity for the loss to occur. It should be remembered that authority to loan money and take security for its payment implies no authority to collect it (Isaacs v. Zugsmith, 103 Pa. 77). Nor does the authority to enter into a lease for the principal imply any authority in the agent to cancel or receive a surrender of it.

Authority for an agent to sign an agreement of sale must be in writing else under the State of Frauds it would not be binding on the principal (Parish v. Koons, 1 Pars. 78; Darlington v. Darlington, 160 Pa. 65). Nor can a lease for a longer term of three years be made by an agent unless his authority be in writing. It is, therefore, good practice for every broker to require his principal to give him written authority both to sell and lease, as well as stipulate the commissions to be paid. In this way much misunderstanding and litigation may be avoided.

198. When a Broker is Personally Liable.

The principal, unless bound by agreement for a definite period, may revoke the agency at any time, but he cannot take his property out of the broker's hands during the pendency of negotiations for the mere purpose of depriving the broker of his commissions (Kelly v. Marshall, 172 Pa. 396; Black v. Pentony, 30 Superior 41). Where the agent has partly performed his contract he is, of course, entitled to some compensation when his authority is revoked (Stamets v. Denniston, 193 Pa. 548).

199. When a Broker is Personally Liable.

Every agent impliedly agrees when employed that he will use reasonable care, skill and diligence in performing his duties. As said by Mr. Justice Coulter, in Wingate v. Mechanics' Bank, 10