Avoid Legal Battles over Broker Commissions

Commissione agreements that spell out how brokers are paid typically use form documents. The commission formula sometimes changes, but the terms and conditions usually stay the same. Consequently standard terms and conditions of commission agreements are often ignored by brokers and owners once the agreement is signed. Since the broker?s income is tied to the terms of those agreements, close attention to details are vital to all parties involved.

Recent lawsuits stemming from disputes over broker commissions reveal tough lessons about the importance of paying close attention to commission agreements.

A building owner in Detroit was forced to pay a commission because the original agreement did not contain an expiration or termination date. The building owner argued that there are a number of key terms understood and agreed to prior to signing the agreement that were not contained in the final written agreement. The judge overruled this argument stating that the contract was clear as written.

Judges and juries are not real estate professionals. The term ?procuring cause? may have a standard definition in the real estate business, but mean nothing to a juror. All parties involved must make sure the language is clear. A judge or jury will not rewrite a contract to save either party from a bad business decision.

Even after a favorable commission contract is successfully negotiated and written, it?s not OK to simply file it away. Either party cannot claim they forgot about the agreement.

The lesson here is to carefully note important terms and conditions, especially those that relate to performance, compensation, and termination.

Legal disputes are not unique to any location. Judges and juries nationwide are showing resistance to insert terms into commission contracts or allow parties to ignore the terms of a contract. Recently there?s been an increase in the number of disputes. Some have settled out of court, yet a fair number have gone to litigation. This can be reversed through the efforts of brokers and owners who invest more time and effort putting together agreements and abiding by them. This is the best method of prevention.

Good luck to you,

Posted by Carol Toupin on December 13, 2008 at 12:00 AM

About Carol Toupin
Carol Toupin is affliated with Downing-Frye Realty Inc, which is located in Naples, FL. For further assistance please use the contact information located on the right.

As of 05/21/12 the Carol Toupin RePage is ranked at 5,523 with 385 points.

Local Information for Naples, FL

Latitude: 26.152941 -- Longitude: -81.79851

ZIP Codes for Naples, Florida	34101 34102 34103 34104 34105 34106 34107 34108 34109 34110 34112 34113 34114 34116 34117 34119 34120
Area Code for Naples, Florida	239
Time zone for Naples, Florida	EST

Other Area Cities: Fort Myers Beach, FL Naples, FL Bonita Springs, FL East Naples, FL Golden Gate, FL Naples Park, FL Palm River Estates, FL Marco Island, FL

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Once, the only people to stroll Naples' seven miles of white, sandy beaches, were the Calusa Native Americans. The first settlers, Roger Gordon and Joe Wiggins, arrived in Naples in the late 1860's. A river and two inlets still bear their names. Throughout the 1870's and '80's, magazine and newspaper stories telling of the area's mild climate and abundant fish and game likened it to the sunny Italian peninsula. The name Naples caught on when promoters described the bay as "surpassing the bay in Naples, Italy." In 1887, a group of wealthy Kentuckians, led by Walter N. Haldeman, owner of the Louisville Courier-Journal, purchased virtually the entire town of Naples. One of the first improvements Haldeman and his Naples Company made was to build a pier 600 feet into the Gulf of Mexico. The pier's "T" shape allowed large ships to dock easily. Despite being destroyed and rebuilt three times, the pier remains today. -- Source: Wikipedia.com

Florida 2000 Census Population Profile Map

	Naples	Florida	United States
Population	20,976	15,982,378	281,421,906
Median age	60.7	38.7	35.3
Median age for Male	60	37.3	34
Median age for Female	61.2	40.1	36.5
Households	10,803	6,337,929	105,480,101
Household population	20,704	15,593,433	273,643,273
Average household size	1.92	2.46	2.59
Families	6,570	4,210,760	71,787,347
Average family size	2.38	2.98	3.14
Housing units	16,956	7,302,947	115,904,641
Occupied units	10,803	6,337,929	105,480,101
Vacant units	6,153	965,018	10,424,540

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Avoid Legal Battles over Broker Commissions

Local Information for Naples, FL

Latitude: 26.152941 -- Longitude: -81.79851

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