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 Michael Wheelock on December 13, 2008 at 12:00 AM

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Michael Wheelock is affliated with premier properties, which is located in Pocatello, ID. For further assistance please use the contact information located on the right.

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Local Information for Pocatello, ID

Latitude: 42.875214 -- Longitude: -112.447267

ZIP Codes for Pocatello, Idaho	83201 83202 83203 83204 83205 83206 83209
Area Code for Pocatello, Idaho	208
Time zone for Pocatello, Idaho	MST

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Pocatello (IPA: [po k? t? lo]) is the county seat and largest city of Bannock CountyGR6, with a small portion on the Fort Hall Indian Reservation in neighboring Power County, in southeastern Idaho. It is the principal city of the 'Pocatello, Idaho Metropolitan Statistical Area' which encompasses all of Bannock and Power counties of Idaho. As of the 2000 census Pocatello population was 51,466 (2004 estimate: 52,910). [1] Pocatello routinely switches places with Idaho Falls as the third largest city in the state and the largest city in the Eastern Idaho region. Pocatello is home of Idaho State University. Founded as an important stop on the first railroad in Idaho during the gold rush, the city later became an important center for agriculture. It is located along the Portneuf River where it emerges from the mountains onto the Snake River Plain, along the route of the Oregon Trail. -- Source: Wikipedia.com

Idaho 2000 Census Population Profile Map

	Pocatello	Idaho	United States
Population	51,466	1,293,953	281,421,906
Median age	28.8	33.2	35.3
Median age for Male	28.3	32.2	34
Median age for Female	29.4	34.2	36.5
Households	19,334	469,645	105,480,101
Household population	49,803	1,262,457	273,643,273
Average household size	2.58	2.69	2.59
Families	12,966	335,588	71,787,347
Average family size	3.1	3.17	3.14
Housing units	20,627	527,824	115,904,641
Occupied units	19,334	469,645	105,480,101
Vacant units	1,293	58,179	10,424,540

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Avoid Legal Battles over Broker Commissions

Local Information for Pocatello, ID

Latitude: 42.875214 -- Longitude: -112.447267

Enter our Photo Sweepstakes and Win $200 for your Pocatello photos!

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