## Facts

- Allen E. Daubman and Renee A. Daubman hired CBS Real Estate Co. and its salesperson, Arlene Engelbert, under an exclusive-right-to-sell listing agreement for the sale of the Daubmans’ home.
- Thomas and Brenda Pedersen agreed to buy the home for $139,950, and the listing called for a 7% cash commission to CBS at closing.
- The Pedersens’ initial loan application was rejected by a bank, putting the sale at risk.
- Without the Daubmans’ knowledge or informed consent, Engelbert took steps to keep the transaction moving, including assisting the Pedersens in obtaining financing from another bank and taking other actions aimed at making the sale close.
- The sale closed on July 31, 1992, and the Daubmans paid CBS a commission of about $9,793 from the sale proceeds.
- The Daubmans sued CBS and Engelbert in assumpsit for money had and received, alleging that defendants put their own interest in earning a commission ahead of the sellers’ interests and therefore were not entitled to keep the commission.
- After a bench trial, the district court found that CBS and Engelbert breached fiduciary duties owed to the Daubmans and ordered the commission returned, with prejudgment interest and costs.
- The Nebraska Court of Appeals vacated the judgment and remanded with directions to dismiss, concluding the evidence did not support the district court’s decision.
- The Nebraska Supreme Court granted further review.

## Issues

1. Whether, in an action for money had and received, the evidence supported the district court’s finding that the listing broker and salesperson breached fiduciary duties to the sellers by pursuing financing and closing steps without the sellers’ knowledge or consent.
2. Whether the sellers’ alleged ratification or acquiescence barred recovery of the commission.
3. Whether the Court of Appeals applied the proper standard of review when it set aside the district court’s factual findings in an action at law tried to the court.
4. Whether the district court’s award of prejudgment interest on the returned commission was proper.

## Decision

- The Nebraska Supreme Court reversed the Court of Appeals and remanded with directions consistent with reinstating the district court’s judgment requiring return of the commission.
- The Court held that assumpsit for money had and received is an action at law; therefore, the district court’s factual findings (after a bench trial) had the effect of a verdict and could not be displaced on appeal unless clearly wrong.
- Viewing the evidence in the light most favorable to the Daubmans, the Court concluded the district court was not clearly wrong in finding that CBS and Engelbert breached fiduciary duties to the Daubmans.
- The Court rejected the defendants’ arguments that the sellers’ conduct amounted to ratification or acquiescence sufficient to defeat the claim, deferring to the district court’s fact findings on what the sellers knew and consented to.
- Because the broker and salesperson breached fiduciary duties, the Court agreed they were not entitled to keep the commission and that restitution of the paid commission was an appropriate remedy in a money-had-and-received action.
- The Court modified the judgment as to prejudgment interest but left intact the core remedy requiring return of the commission.

## Legal Principles

- Assumpsit for money had and received lies when a defendant has received money that, in equity and good conscience, should be returned; the law implies a promise to repay to prevent unjust enrichment.
- Although based on equitable considerations, money had and received is an action at law in Nebraska.
- In an action at law tried to the court, the trial court’s factual findings have the effect of a verdict and will not be set aside unless clearly wrong; on appeal, evidence is viewed in the light most favorable to the successful party, while legal questions are reviewed independently.
- A real estate broker and salesperson owe fiduciary duties to their principal, including loyalty, good faith, and full and prompt disclosure of material facts affecting the principal’s interests and decisionmaking.
- When a fiduciary acts out of self-interest in a way that breaches duties to the principal—such as taking material steps to salvage and close a transaction without the principal’s knowledge or informed consent—the fiduciary may forfeit the right to compensation, and amounts already paid may be recovered in restitution.
- Ratification or acquiescence requires informed approval; whether a principal had the necessary knowledge and consent is generally a fact question for the trial court.

## Conclusion

Daubman v. CBS Real Estate Co. holds that a seller may recover a paid real estate commission in an action for money had and received when the listing broker and salesperson breach fiduciary duties by acting to secure closing and their commission without the seller’s informed knowledge and consent, and that appellate courts must respect a trial court’s fact findings in such an action unless those findings are clearly wrong.


Daubman v. CBS Real Estate Co., 580 N.W.2d 552 (1998)