broker's commission

[nickjames]

What is the name of your state? Texas

I am a business broker who entered into an agreement with a seller of a business (and the real estate along with it) to find a buyer. The listing agreement allows for a commission not only for an outright sale but for the procurement of a valid offer as well. I eventually found a buyer who offered the terms of the listing agreement but added some pretty big conditions to it. The seller did not respond to this offer for three weeks (the listing agreement states that he should respond in kind within 48 hours if the offer is not acceptable). Anyways, after 3 weeks or so the seller decided not to sell because of these conditions. However, I have recordings of our telephone conversations where he ADMITS that he owes me my commission and that he will pay it because I found him a buyer who matched the terms of the listing agreement. He admits this several times on these recordings (in Texas, it is legal to tape phone calls with one party consent). My question is this: even if the offer was not a valid one according to the LISTING AGREEMENT, do these phone calls constitute a subsequent oral contract to pay for past performance? The recordings are clear and easy to understand. Please help with any thoughts.

 

[HomeGuru]

What is the name of your state? Texas

I am a business broker who entered into an agreement with a seller of a business (and the real estate along with it) to find a buyer. The listing agreement allows for a commission not only for an outright sale but for the procurement of a valid offer as well. I eventually found a buyer who offered the terms of the listing agreement but added some pretty big conditions to it. The seller did not respond to this offer for three weeks (the listing agreement states that he should respond in kind within 48 hours if the offer is not acceptable). Anyways, after 3 weeks or so the seller decided not to sell because of these conditions. However, I have recordings of our telephone conversations where he ADMITS that he owes me my commission and that he will pay it because I found him a buyer who matched the terms of the listing agreement. He admits this several times on these recordings (in Texas, it is legal to tape phone calls with one party consent). My question is this: even if the offer was not a valid one according to the LISTING AGREEMENT, do these phone calls constitute a subsequent oral contract to pay for past performance? The recordings are clear and easy to understand. Please help with any thoughts.

**A: the terms and conditions of the listing agreement stand, notwithstanding the seller's verbal promise to pay a commission.

 

[nickjames]

What is that based on? Does this mean that oral contracts are void specifically for broker commission cases?

 

[HomeGuru]

What is that based on?

**A: a number of factors.
*******
Does this mean that oral contracts are void specifically for broker commission cases?

**A: for the most part yes, and in your case yes.

 

[nickjames]

I appreciate your response, but could you elaborate more on why this situation invalidates oral agreements?

 

[HomeGuru]

I appreciate your response, but could you elaborate more on why this situation invalidates oral agreements?

**A: provide more info- type of real estate and value, type of business and value, type of listing agreement, listing amount, offer amount and contingencies. Lastly, the amount of commission due.

 

[nickjames]

The listing agreement allows for commission to be earned upon an offer matching the terms of the agreement or any other terms acceptable to the seller. These oral promises are not parol evidence because they happened way after the agreement was entered into and in no way affect or modify those original terms. Similarly, I don't think the Statute of Frauds applies because the oral promises do not go to the sale of land but to the payment of a commission. I don't see how the value and type of business is relevant as well as the amount of the commission. Is it established as a matter of law that oral contracts are void in these types of cases?

 

[HomeGuru]

The listing agreement allows for commission to be earned upon an offer matching the terms of the agreement or any other terms acceptable to the seller. These oral promises are not parol evidence because they happened way after the agreement was entered into and in no way affect or modify those original terms. Similarly, I don't think the Statute of Frauds applies because the oral promises do not go to the sale of land but to the payment of a commission. I don't see how the value and type of business is relevant as well as the amount of the commission. Is it established as a matter of law that oral contracts are void in these types of cases?

**A: since you refuse to help me to help you, good day and good luck.

 

[nickjames]

Anybody else?

 

[HomeGuru]

Anybody else?

**A: right. No one else here is going to help you.

 

[divgradcurl]

do these phone calls constitute a subsequent oral contract to pay for past performance?

Also, just from a purely technical standpoint, "past performance" is not valid "consideration" to create a contract.

 

[HomeGuru]

good one. Nick, are you a licensed real estate agent or broker?

 

[nickjames]

Past performance CAN constitute sufficient consideration in certain instances. If you are a lawyer then you know the difference between hornbook law and actual caselaw.

 

[HomeGuru]

Past performance CAN constitute sufficient consideration in certain instances. If you are a lawyer then you know the difference between hornbook law and actual caselaw.

**A: Oh brother, this thread is going to the groundhogs.

 

[divgradcurl]

Past performance CAN constitute sufficient consideration in certain instances. If you are a lawyer then you know the difference between hornbook law and actual caselaw.

Since you are the expert, go file your lawsuit -- what are you wasting your time here for?

**A: right. No one else here is going to help you.

Should have listened to HomeGuru...