Broker Fee

[anirudh316]

What is the name of your state (only U.S. law)? MA

Question regarding Broker fee for rented apartment:
I was shown an apartment by a broker who made me sign a "Fee disclosure" form before entering the apartment. The form states that I must pay them a fee if I rent the apartment.
The next day, I saw the same listing online and see that the listing agent has not assigned any fee for it. I go and meet the listing agent who was really confused as to who could have showed me the property, since she did not give out the lock code to anyone (she mentioned it was illegal and as good as breaking and entering by the first broker).
We find out that the listing agent had given the lock code to one of the broker's colleague a while back who was NOT supposed to pass it on to anyone without her permission. However, instead of completely DISMISSING the broker fee (since that broker should NOT have shown me the apartment in the first place), the listing agent negotiated it down a little bit.
I am NOT willing to pay any broker fee now because it was clearly illegal, and the broker had no contact with me since except for sending me a notice for collection of the broker fee.
Can I sue the broker for illegal activity / misleading me into believing they were the listing agent / authorized to show me the place? Should I pay any broker fee?

 

[justalayman]

I don't know what you think is illegal and you did sign a contract with the broker. If you rented the apartment you owe the man.

If the showing was illegal the second broker would have called the police. Given he negotiated the fee, it was implied agreement with the first brokers actions.

 

[anirudh316]

The broker was not authorized to show me the place. How can he claim a fee on that? I have an email from the listing agent specifying this fact.

 

[Zigner]

The broker was not authorized to show me the place. How can he claim a fee on that? I have an email from the listing agent specifying this fact.

Best of luck in court.

 

[justalayman]

The broker was not authorized to show me the place. How can he claim a fee on that? I have an email from the listing agent specifying this fact.

That is between the agency that has the contract and the broker you signed a contract with.

The fact is if you sign a contract that each time you leave your house you pay me a dollar even though I have no lawful right to control your movements, you can in fact enter into such a contract and you can expect I'll be looking for my dollars.


The only argument you might have is it is not actually a contract and as such, not enforceable.

So, if there was supposedly no fee involved, why did you pay the listing agent a fee?

I suspect there are things you either are not aware of or not disclosing here. The first thing that comes to mind is:

Do all of the agents and brokers work for the same brokerage. Of so, you lose outright as the principal broker is actuslly the entity that controls and all those under him/her are (for lack of better terms) employees acting under the authority of the broker.

Then, if these are Realtor's and MLS is involved, unless the listing contract was specifically written as exclusive to the agent involved, it is available to all Realtors to show and contract for.


For fun research "procuring cause" in regards to real estate sales and rentals. It will help you understand how the first broker can maintain his claim.

 

[anirudh316]

Re:

I did NOT pay a fee to the agent.
The listing agent is separate from the broker. The listing agent did not charge ANY fee. They had provided another broker with access to show the apartment months ago but not since. This broker passed on the lock code to my broker, which the listing agent and owner were not aware of.

 

[justalayman]

I did NOT pay a fee to the agent.
The listing agent is separate from the broker. The listing agent did not charge ANY fee. They had provided another broker with access to show the apartment months ago but not since. This broker passed on the lock code to my broker, which the listing agent and owner were not aware of.

first, an AGENT must work under a BROKER. The AGENT has a BROKER. How and if the person that showed you the apartment and the listing agent and their broker are known to each other, I have no idea. I wasn't there.

you still signed a contract with the guy.



if the listing agent didn't charge a fee, then what is this about:

We find out that the listing agent had given the lock code to one of the broker's colleague a while back who was NOT supposed to pass it on to anyone without her permission. However, instead of completely DISMISSING the broker fee (since that broker should NOT have shown me the apartment in the first place), the listing agent negotiated it down a little bit.

he negotiated what down and with whom?



If you don't think you owe anything, tell him to get lost. If he sues you, you may want to take him a little more seriously.

 

[anirudh316]

Re:

My only question is if I refuse to give them any amount, can they take me to court and compel me to pay a "higher" amount than the original or would I just have to pay them the original amount?

 

[justalayman]

Well, ya lost me on the somebody negotiated a discount with somebody else thing so I don't know where you stand.

As to what they can sue you for above and beyond the fee:

Read your contract. It may include you agreeing to pay the brokers legal expenses should you breach the agreement. What else it includes I have no idea.

 

[anirudh316]

If you really want to know, the listing agent is the one who puts up the property on behalf of the owner. the broker is the one who shows clients those properties. Out of the broker fee, they are supposed to share it equally.
In this case, the listing agent was NOT charging anything. Because the other broker meddled in between by showing me the property when they were not authorized to do so, the broker is still demanding their half.

The contract I signed does not say anything about extra legal fees that they might charge me.

 

[justalayman]

If you really want to know, the listing agent is the one who puts up the property on behalf of the owner. the broker is the one who shows clients those properties. Out of the broker fee, they are supposed to share it equally.
In this case, the listing agent was NOT charging anything. Because the other broker meddled in between by showing me the property when they were not authorized to do so, the broker is still demanding their half.

The contract I signed does not say anything about extra legal fees that they might charge me.

it's not that I really want to know. I was attempting to understand the relationships you are dealing with so as to maybe explain things or point you somewhere.

to make it simple and clear, call the guy you signed a contract with broker 1 and the other broker 2. agent can be agent.
What I see;

the guy that showed the apartment to you (broker 1); you did sign a contract with him. If you want to argue the contract was illegal and as such, unenforceable, I doubt you will prevail. If he is a licensed agent/broker, he can engage into contracts with anybody to locate property. What I don't know is how you ended up with the guy showing you the apartment to start with. Something led you to both him and that apartment. It probably is not going to make any difference but it may.



the agent; agents don't actually charge fees. The brokerage they work for does. Then the broker pays whatever commission had been negotiated between the broker and agent. Same effect as what you stated but in real estate agency hierarchy, the broker is the person in charge and the entity all contracts are actually written under. The agent is...well, an agent of that broker. They work for the broker.

I am still missing who negotiated what with you. Yet you say there was no fee being charged by the listing brokerage (to the renter; presumably it was being paid by the owner) but somebody negotiated some fee with you. I do not understand why anybody in the listing brokerage would have negotiated anything with you as they had no fee in place to negotiate. Can you make that a bit clearer?



are these folks Realtors (with a capital R. ) do you know if this was listed in the MLS system? MLS is a Realtor (National Association of Realtors) owned listing system where there is a "behind the scenes" contractual relationship between all members to "share" listings. A listing can be made exclusive even in this system but if not, it is a "shared" listing with all other Realtors.

 

[LdiJ]

it's not that I really want to know. I was attempting to understand the relationships you are dealing with so as to maybe explain things or point you somewhere.

to make it simple and clear, call the guy you signed a contract with broker 1 and the other broker 2. agent can be agent.
What I see;

the guy that showed the apartment to you (broker 1); you did sign a contract with him. If you want to argue the contract was illegal and as such, unenforceable, I doubt you will prevail. If he is a licensed agent/broker, he can engage into contracts with anybody to locate property. What I don't know is how you ended up with the guy showing you the apartment to start with. Something led you to both him and that apartment. It probably is not going to make any difference but it may.

I disagree with you. The broker was not at all authorized to show the unit. He was not authorized to have the lock box combination. The agent did not authorize ANY brokers to show the apartment nor was the agent charging a listing fee.

the agent; agents don't actually charge fees. The brokerage they work for does. Then the broker pays whatever commission had been negotiated between the broker and agent. Same effect as what you stated but in real estate agency hierarchy, the broker is the person in charge and the entity all contracts are actually written under. The agent is...well, an agent of that broker. They work for the broker.

An agent does not have to work for a broker. The agent could be anyone the landlord authorized to manage/handling renting the unit.

I am still missing who negotiated what with you. Yet you say there was no fee being charged by the listing brokerage (to the renter; presumably it was being paid by the owner) but somebody negotiated some fee with you. I do not understand why anybody in the listing brokerage would have negotiated anything with you as they had no fee in place to negotiate. Can you make that a bit clearer?

I think its clear that the agent negotiated with the unauthorized broker...but it would help if the op clarifies. However, I suspect that in order to avoid ill will in the real estate community that the agent is throwing something the broker's way.

are these folks Realtors (with a capital R. ) do you know if this was listed in the MLS system? MLS is a Realtor (National Association of Realtors) owned listing system where there is a "behind the scenes" contractual relationship between all members to "share" listings. A listing can be made exclusive even in this system but if not, it is a "shared" listing with all other Realtors.

 

[justalayman]

LdiJ;3387785]I disagree with you. The broker was not at all authorized to show the unit. He was not authorized to have the lock box combination.

it is irrelevant though. If op signed a contract with broker 1 she would pay broker 1 some fee for some agreed upon action, if that action is fulfilled she owes regardless of anything else in the world. She may have some defenses but on it's face, she owes what she contracted to pay if broker 1 fulfilled any promises made in that contract.

The agent did not authorize ANY brokers to show the apartment nor was the agent charging a listing fee

.yet there was a negotiation of (apparently) broker 2's fee by either agent or broker 2. HHmmm,

quack quack

An agent does not have to work for a broker. The agent could be anyone the landlord authorized to manage/handling renting the unit.

my assumption yes, but when you start tossing in brokers, the agent is most likely a RE agent who must be licensed and work under a broker. Especially since op stated agent lists the apartment for owner, it's starting to sound a lot like a formal real estate agency relationship

quack quack

I think its clear that the agent negotiated with the unauthorized broker

.WHY? if the broker 1 had no authority here, why negotiate anything? By negotiating with broker 1, he has affirmed some authority of broker 1. In fact, by what authority could agent or broker 2 negotiate ANYTHING with broker 1? Broker 1, by your understanding, has no affiliation that would put agent or broker 2 in any position to negotiated anything, especially since OP does not appear to be a principal in a contract with agent or broker 2.

 

[anirudh316]

Re:

Ok, hope this make it a little clearer.
There are only 3 parties here: Myself, the "agent" (who is a family member of the owner, had listed the apartment directly on websites and was NOT charging any fee if I were to rent the apartment from him), and then this broker (who had also gotten a hold of this listing somehow but was NOT authorized by the agent or owner to show this place to anyone).

I saw these 2 separate listings in separate websites (I did not realize these were the same apartment since I was viewing a lot of apartments). I saw this place with the "broker" first who made me sign the "fee disclosure" form.
Next day, I saw this apartment with the agent (when I told her I had seen this place with someone else, she was shocked and said she had NOT authorized anyone else - how did they even get the lock code).

After some research, we found out that the agent had given her friend the lock code to show the place to someone, MONTHS ago. This friends passed it on to someone else, who passed it on to the broker but this broker NEVER got permission to show me this place.

As to why the agent negotiated with the broker rather than totally dismissing him, I do not know. I guess it's because the agent felt I had signed this piece of paper, and they wanted me to rent this place.

NOW, If I don't pay the broker, can he sue me for the full fee? Can he also ask me to pay more as damages (since they could incur legal costs etc.)?

 

[Zigner]

Ok, hope this make it a little clearer.
There are only 3 parties here: Myself, the "agent" (who is a family member of the owner, had listed the apartment directly on websites and was NOT charging any fee if I were to rent the apartment from him), and then this broker (who had also gotten a hold of this listing somehow but was NOT authorized by the agent or owner to show this place to anyone).

I saw these 2 separate listings in separate websites (I did not realize these were the same apartment since I was viewing a lot of apartments). I saw this place with the "broker" first who made me sign the "fee disclosure" form.
Next day, I saw this apartment with the agent (when I told her I had seen this place with someone else, she was shocked and said she had NOT authorized anyone else - how did they even get the lock code).

After some research, we found out that the agent had given her friend the lock code to show the place to someone, MONTHS ago. This friends passed it on to someone else, who passed it on to the broker but this broker NEVER got permission to show me this place.

As to why the agent negotiated with the broker rather than totally dismissing him, I do not know. I guess it's because the agent felt I had signed this piece of paper, and they wanted me to rent this place.

NOW, If I don't pay the broker, can he sue me for the full fee? Can he also ask me to pay more as damages (since they could incur legal costs etc.)?

He can sue you for whatever the contract allows him to sue you for...likely successfully.