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negotiate sales and receive binding money, and that as compensation for his services he should receive commissions upon “sales” of the lands, the rate of commission to depend upon the kind of services rendered by Hinsley in the particular sale.
The word "sale" is ordinarily understood to mean a transfer of property for money. (2 Blackstone's Com. 446; Schermerhorn v. Talman, 14 N. Y. 117; Williamson v. Berry, 8 How. 495; Five per cent cases, 110 U. S. 471.) In the case last cited the Supreme Court of the United States construed the language hereinafter quoted from an act of Congress of March 3, 1845, supplemental to the act by which the State of Iowa was admitted into the Union, the language so construed being as follows, to-wit: “Fifth, that five per cent of the net proceeds of sales of all public lands lying within the said State which have been or shall be sold by Congress from and after the admission of said State, after deducting all the expenses incident to the same, shall be appropriated for making public roads and canals within the said State.” The question was whether the State was entitled to a percentage of the value of lands not sold for cash but disposed of by the United States in satisfaction of military land warrants. The court said: "A sale, in the ordinary sense of the word, is a transfer of property for a fixed price in money or its equivalent.” If the purchase price is paid by the transfer of other property, the transaction is more properly denominated an exchange or trade. “It is a familiar rule, of constant application, that courts give effect to all written instruments according to the ordinary, popular meaning of the terms employed, when nothing appears to show they were used in a different sense and no unreasonable or absurd consequences will result from doing so." Stettauer v. Hamlin, 97 Ill. 312.
If this rule of construction is applied to the contract of December 10, 1888, it is apparent that Hinsley would not be entitled to commissions upon the transfer of the lands
to the Amity Land Company, that transfer not having been made for a money consideration. There is, however, another well known rule of construction applied to written instruments, viz., that in construing a written contract the court will endeavor to place itself in the position of the contracting parties, and read the instrument in the light of the circumstances surrounding them at the time it was made and of the objects which they then evidently had in view, so that the court may understand the language used in the sense intended by the parties using it. Torrence v. Shedd, 156 Ill. 194; Street v. Chicago Wharfing Co. 157 id. 605; Matthews v. Kerfoot, 167 id. 313; Whalen v. Stephens, 193 id. 121.
Applying the latter test to the contract of December 10, 1888, is there anything appearing, from the circumstances surrounding the parties at the time the contract was made, which shows an intention on their part to give to the word "sale” any other than its usual and ordinary meaning? An answer to this question involves a consideration of those circumstances as disclosed by the evidence.
It appears from the stipulation and undisputed evidence in the case that during the years 1887 and 1888, and prior thereto, appellants were engaged in the business of colonizing large tracts of western lands; that they had numerous agents in their employ, some of whom were known as field agents and others as traveling agents; that the traveling agents were employed to interest persons in Illinois and eastern States in the western lands controlled by appellants and to induce prospective purchasers to visit the lands; that the field agents resided on or in the immediate vicinity of the lands offered for sale, and to them the traveling agents brought or sent the prospective purchasers; that the field agents were required to be familiar with each quarter section of land within their respective territories and the boundaries thereof, and it was their duty to show the lands to the prospective purchasers and to aid the traveling agents in making the sales. Hinsley had acted as field agent for appellants in Iowa prior to April 2, 1887. On the latter date he removed from Iowa to Hartland, Kansas, and entered the service of appellants as field agent for their lands in that vicinity under a contract, by the terms of which he was to receive a salary of $40 per month and five cents per acre on all lands sold by the appellants by or through his assistance. Hinsley worked under the latter contract until December 10, 1888, when the contract of that date was entered into.
Bearing in mind these facts, the reason for fixing three different rates of commission becomes apparent, and the sense in which the parties intended to use the word "sale" may be clearly understood. According to the previous experience of appellants and Hinsley, in carrying on the business of appellants there might, and probably would, arise three classes of cases in which Hinsley would be required to render some service in effecting sales of the lands: First, cases in which Hinsley should find the purchaser and make the sale; second, cases in which prospective purchasers should be brought or sent by appellants or their traveling agents to Hinsley and the latter should show the lands to the prospective purchasers, and thereby, or by other means, assist appellants or their traveling agents in inducing the purchasers to buy; third, cases in which other field agents in that locality should send to appellants the applications of prospective purchasers, and appellants, not knowing whether it would be to their interest to make the sales on the terms proposed, should seek the advice of Hinsley with reference thereto. Hence the parties provided by the contract of December 1o, 1888, that on all sales falling within the first class Hinsley should receive twenty-five cents per acre, on all sales falling within the second class, ten cents per acre, and on all sales falling within the third class, five cents per acre.
Considering this contract in the light of the circumstances surrounding the parties at the time the contract was
made and of the objects which they then evidently had in view, it does not appear that they intended to use the word "sale" other than according to its ordinary acceptation.
When the contract of February 18, 1895, is considered in connection with the facts leading up to its execution, it becomes apparent that the parties thereto adopted the means set forth by that contract to effect a consolidation of their respective interests. It appears from the evidence that the Amity Canal and Reservoir Company was originally the owner of the canal and of other Colorado property subsequently owned by the Amity Land and Irrigation Company. The former company issued bonds secured by mortgage upon its property, and these bonds were taken by the Western National Bank of New York. The mortgage was foreclosed and the property of the company purchased by the bank at the foreclosure sale. The bank, early in 1894, through its officers and agents, organized the Amity Land and Irrigation Company and transferred the property to that company. The bank, however, remained the beneficial owner of the property. The appellants desired to sell the Kansas lands. Those lands could not well be sold without some means of irrigation. The canal of the Amity Land and Irrigation Company could be extended to the Kansas lands, but appellants did not desire to buy that canal and the bank did not wish to purchase the Kansas lands. Appellants, their principals, the owners of the Kansas lands, and the Amity Land and Irrigation Company, really acting for and under the direction of the bank, on February 18, 1895, entered into the contract of that date. No money was to pass. The bank had theretofore conveyed its canal and other Colorado property to the Amity Land and Irrigation Company. The value of that property was not as great as the value of the Kansas lands. The bank desired to retain the controlling interest in the corporation to which it had transferred the canal. It was therefore agreed that the owners of the Kansas lands should convey those lands to the Amity Land and Irrigation Company and should receive therefor forty-nine per cent of the stock of that company or of its successor or assignee, and in order to equalize the interests of the respective parties in the assets of the corporation, it was also provided that the owners of the Kansas lands should receive, in addition to their stock, bonds of the corporation of the face value of $600,000, secured by mortgage on the property of the company.
While it is true that the owners of the Kansas lands parted with the title to those lands, yet they did so for the purpose of placing those lands in such condition that they might be sold for money. Hinsley was urging appellants to either purchase the canal or secure the controlling interest therein. The services for which he now seeks to recover were performed with that end in view. Obviously, if the appellants, for their principals, had followed the advice of Hinsley and purchased the canal, Hinsley would not have been entitled to any commission under his contract. By the plan adopted in the contract of February 18, 1895, the owners of the Kansas lands obtained the same benefit as they would had they purchased the canal, the only substantial difference being, that instead of receiving their money directly from purchasers of the lands, they would receive it, when the lands were sold, in the form of payments upon the bonds and dividends upon the stock issued to them by the Amity Land and Irrigation Company. We think that neither Hinsley nor the appellants had in contemplation any such transfer of property as that set forth in the last mentioned contract when they agreed that Hinsley should receive commissions upon all sales made by him alone, or made with his assistance, or made under his advice.
Appellee seeks to sustain the judgment in this case upon the authority of Wilson v. Mason, 158 Ill. 304, and other like cases, which hold that a real estate broker is entitled to his commissions if the principal sells to a purchaser produced by him, even though the sale be made upon terms