Selling broker suing me after I stop the sale

I think you can definitely pay your attorney $10,000 to win this case.

Real estate brokers are licensed through the state (Dept of State or perhaps the Attorney General's office), which presumably has a complaint process available. Sounds like this is also the building's managing agent too?

Looks as if it's this one: http://streeteasy.com/sale/1222443

If the owner's being sued, it hasn't been filed yet.

You should have a contract with the agent- read it

What is a "selling agent / managing agent"?

If you replace that odd term with "broker" then I'll tell you the broker has no case. And so make your appearance at Court, ask for the case to be heard by the judge not by an arbitrator. No need for an attorney. Then, call the Daily News, they love this sh*t.

If he brought you a buyer, and there was a meeting of the minds (i.e. an accepted offer), whether the apartment went into contract or not is technically irrelevant- you would owe him a commission. That said, it doesn't sound like the smartest decision. Relationships and reputation are everything in real estate, and suing for $5k is ridiculous for a deal that didn't even go into contract. Even if it had gone into contract, but the deal fell apart, it is still ridiculous to sue. You could have been a great source for referrals- which would be worth far more than what he is suing for.

semerun, bs. commission is paid only if the sale closes.

I am not saying it is good business, but it is not true that commission is paid only if the sale closes. Acceptance- also referred to as a meeting of the minds - occurs when the parties agree on price, down payment, financing method, and other essential terms. At this point, the broker has earned a commission, even if the sale never closes. There are specific requirements to define Acceptance but the definition above is accurate and true. Again, I repeat, this is not a great way to do business.

No ticket, no shirt semenrun.

Um...not a great comparison. http://www.dos.ny.gov/cnsl/rebcommdue.html

semerun, I stand corrected. It will depend on the agreement. Wonder what the standard agreement of sellers with the broker says in NYC?

Sorry, that's not going to work against an individual / consumer homeowner at trial in front of a judge or jury.

Jury? Given the amount the broker is suing for, it sounds like small claims court- and the broker may not get the $5k requested, but will likely get something from the court. Yes- it can work, and often does.

If this goes to small claims court, when you get there you will be asked if you accept arbitration. DO NOT accept arbitration because then you WILL end up expected to come to some sort of compromise that will cost you, and if you appear unwilling then it will cost you even more.

@300_mercer: I'm not the industry standard since I'm a boutique broker (and the industry standard probably doesn't matter anyway, because the individual agreement that the OP signed is what's going to govern here) but my listing agreement says "produces a purchaser."

Even if an offer had been accepted and a contract sent out, I would not feel that I had "produced a purchaser" until said purchaser had signed a contract and put down earnest money.

I suppose then it would still be a gray area until the seller countersigned the contract... Not a situation I've ever had to deal with, fortunately.

ali r.
{downtown broker}

@ rc10000, thanks my attorney recommended the same.

There was not an accepted offer or any paperwork signed, or agreement reached with any buyer.
He is the managing agent of the building and a licensed RL broker.

Thanks Ali.

1. if listing agreement requires closed sale broker has no claim

2. if it requires that broker produce ready, willing and able buyer who has agreed
to match seller's offer terms, broker is entitled to be paid if seller changes mind

3. if no buyer and seller changes mind, will not have a claim absent
some extraordinary equitable circumstances

4. to be ready, willing and able buyer must agree to all of seller's
offered terms, in particular price, down payment, financing

Do you really think your broker only put in that one hour for an open house? Were there professional photographs taken? Showsheets made? Was it put on Streeteasy, the New York Times etc. - that's not free. She also used her reputation to contact potential buyers and agent colleagues. Even though you're probably not legally required to pay her I would for time and resources spent. What if you went into a restaurant and ordered food - the kitchen prepared it, you took up a table and then you decided you weren't hungry. Though the law is probably more on your side for your situation I think it's an apt ethical comparison.

Photographs, floorplan, showsheets, SE and a Times ad is not $5K though. We are taking maybe $500-$750 of sunk costs, and IMHO it seems more damaging to one's reputation to chase after that amount of money than to shrug it off as a cost of doing business. It's not like the listing broker's agent colleagues haven't met a client who changed his/her mind before.

ali

OTOH a broker doesn't want to get the reputation of not going after people who owe them commissions because you never know where it will stop with people not paying what they owe you.

>She also used her reputation to contact potential buyers and agent colleagues.

Used her reputation?

>What if you went into a restaurant and ordered food - the kitchen prepared it, you took up a table and then you decided you weren't hungry.

Not comparable.

>Though the law is probably more on your side for your situation I think it's an apt ethical comparison.

What is ethical is that the broker should not make demands outside of the bounds of the written contract and the law.

>It's not like the listing broker's agent colleagues haven't met a client who changed his/her mind before.

Right. And wow, you and I agree on the eyes wide open risks and circumstances that the broker can expect to face in the ordinary course.

>OTOH a broker doesn't want to get the reputation of not going after people who owe them commissions because you never know where it will stop with people not paying what they owe you.

That has nothing to do with this circumstance.

I sleuthed out the apartment and rescind what I said before. Correct me if I'm wrong Omar but is this it? http://streeteasy.com/sale/1222443

"What is ethical is that the broker should not make demands outside of the bounds of the written contract and the law."

Have you seen the contract? In general most exclusive agreements (and the law) provide that the broker has earned their commission when the have "produced a ready willing and able buyer" on the terms listed in the listing agreement.

You are talking your book, rather than the correct position or giving unbiased advice. We have no idea if the "buyer" was ready, willing, or able. We can not be sure in New York State that this is a buyer until such party would meet the all the requirements of consummating the proposed purchase. This is a losing case up until the point that all conditions to making the purchase had been satisfied by the buyer but for the failure of performance by the seller. There's a reason why this is being brought or threatened to be brought to Small Claims Part.

One will find few types of standard financial transactions (of any kind) that carry a 6% cost to the seller. Yet the 6% commission is generally accepted, and it endures, in part because there will always be cases like this when shit happens to the detriment of the broker: the parties disagree about the buyer's qualifications; market conditions change; or yes, the seller just changes his mind. Whatever. The broker takes that risk for the opportunity to bring in the commission when a sale closes. Regardless of what verbiage is put into the agreement, this is the bargain that's generally understood. Obviously this all changes if it goes to contract.

Agree with fieldchester, and good on front_porch for being realistic about the situation.

Perfectly said AVM.

Also agree with AVM's post yet we dont live in a perfect world. Judges are doing F'ed up things these days.

One term someone mentioned earlier in this thread is "meeting of the minds."
This is the phrase to watch out for and what gives brokers the ammo to "try"and sue for their commission.
Just make sure you when asked you didnt go into contract because there was no meeting of the minds.
Unfortunately, if you go through this process with a lawyer you'll spend $5K.

A broker expects to have a unit for 3 months to sell. Did you pull it after 1 and 3 open houses?
Without knowing details you may want to consider offering $500 for expenses to make him/her go away.
Most importantly,using your full name in your logon name wasnt the greatest idea. Everything you wrote can be used (and found) against you in court.

Just a quick google search shows me some of your employment history and a home in Harlem.

You may want to ask SE to delete this thread

>Just a quick google search shows me some of your employment history and a home in Harlem.

Didn't seem appropriate for skrufi to link to the apartment anyway.

And I was thinking same re deleting the thread, but then again the OP might be crazy like a fox...

truth, and his birthday!!

Sorry - just used publicly available info. I can take it off.

I'm a little new to using the discussion group feature and there's not an obvious delete button - anyone? Google isn't much help.

@skrufi, AFAIK, you can't reconsider and delete individual posts the way you can on FB. In general, I think the community tries to keep from posting information that's too personal, even if it is a matter of public record (the exception seems to be that NWT often acts as our master court reporter). Of course, that's just my view, so I'm curious what others think.

If you do really want to delete a post, if you contact Streeteasy, they can probably fix it.

Anyway, welcome to the boards. It's nice to meet new people.

ali

Thank you for that Ali - I won't be so quick on the "post" button next time and will definitely be more respectful of privacy issues!

Wait he's suing you for wasting his time? And he did 1 open house? It's unbelievable how entitled brokers can be in this city. There are great ones but also way too many that get influenced by Million Dollar Listing.

I still shake my head whenever I hear stories like this. Why do people still sign traditional Exclusive Right to Sell Listing Agreements for 6%? Not only are you tied down potentially for 6 months, but if a "ready, willing and able" buyer is found at your listing price and you decide to back out, you STILL owe your listing broker 6%. Unreal.

Just remember, you can access the NYC MLS (i.e. RLS - REBNY Listing Service) without a traditional broker these days. Inman just broke the story: https://www.inman.com/2016/07/25/the-underground-for-sale-by-owner-movement-in-nyc/

Awesome link RiddhiBman! Thx..... Agent Managed FSBO is the future for sure. Saving tens of thousands on commissions.