Dear Stan:

I'm going to take us all into a different direction for a moment. My interpretation as to what is occurring here is that you do not trust the opinon of the agent as a licensed professional real estate associate. This agent has not earned your trust.

Stand, when you walk into a lawyer's office to assist you in arguing a case on your behalf - I would imagine you listen to their advisement. The same would also pertain to let's say a tax accountant. You provide them the information they need and you listen to their advisement as to how to handle your finances in the future for the best tax benefits. If you have a question or an idea, you run it by your "professional" and they then advise you accordingly.

The same courtesy and trust should be provided to "professional, licensed" Realtors, mortgage brokers, etc. Your agent more than likely knows the area and has been practicing there for a while. Furthermore, the agent is able to pull comps - call listing agents - email listing agents, etc. WE ALL DO THIS BEFORE MAKING AN OFFER ON BEHALF OF OUR CLIENT - DON'T WE? I, as a professional, collect every bith of information I can for my client BEFORE submitting an offer on their behalf.

During this "information gathering session" very commonly, we mention the offer amount to the listing agent on the phone and get "oh no - not even close. We already have an offer for such and such." If the agent then advises the client that the offer is too low - it is not going to work out, let's move on . . . . " then the client should trust the agent enough to move on. Why waste everyone's time. My client's TRUST me. I would be writing offers all DAY if I just wrote up everything a client wanted without checking the facts first.

CASE in point (and any buyer's rep can relate to this): An REO property comes on the market. Perfect, beautiful, clean home . . . the house is $70,000 below market. We all know what happens to these perfect, beautiful, clean homes . . . they have 20 offers in a 2 day period and the property sells for $70,000 or $80,000 above the asking price. If I have a client who wants to IGNORE the sold comps I provide to them, and IGNORE my experience and knowledge with this sales tactic, and then low ball the ORIGINAL asking price . . . this is not my type of client and I move on. I will not write that deal. Not because of the deal . . . because this client is not able to trust me as a licensed professional, and they are going to run me ragged while educating themselves with what I already know and have advised them of. Believe me, our relationship is not quite as short as I present it herein . . . I do try to educate on the market . . . but if still no understanding . . . they need to move on to another agent who has a whole lot more time.

In addition Stan, your agent can personally present OR fax OR email an offer to the listing agent. I can't tell you the last time I submitted an offer personally in hand. The day of fax and now email is more than sufficient. Again, trust that the agent knows how to submit the offer in the most expeditious and correct manner.

As far as, "I have a low offer for you" . . . I would love to see that in writing because, in my opinion, that's just not right. Now, maybe there was something else in that note that justified that statement but if it was that and that along . . . I would agree that is not right.

Curiously Stan, did you get the offer submitted? Was it accepted? Did they respond back? Did you move up in price? Did you get the deal done? Do you live there now?

I look forward to your response.

Lisa M. Brodeur
LMB Realty Corp d/b/a Alliance Realty
lmbrealtycorp@aol.com
(954) 868-1416
Fax: (954) 573-6510

not necessarily, Stan. Procuring cause is more than the 'agent who first showed you the property'... is the agent who formed a 'chain of events that lead to the sale, and stayed in touch throughout'.

at best, this agent 'might' be entitled to a showing fee... but it appears that not only is he NOT procuring cause, but may have been an obstacle to the transaction.

find yourself a better agent, explain the situation to him/her and let them battle out the commission woes with the other agent. just be upfront with the new agent, so that they don't get blindsided.

Stan, it is also customary to present the offer to the other agent via fax and phone and email. The buyer's agent does NOT present the offer to the seller themselves. Both sides are represented by their realtor, and is bound ethically and legally to present ALL offers. If I am presenting an offer to the listing agent that is low, I always preface my presentation with explanations as to why and how my buyer arrived at the price they have determined they are willing to pay. If the sellers agent is unwilling to negotiate, then you know what you need to pay if you want the property. If YOUR agent is unwilling to assist you in negotiation, then you need to find a new realtor, and report this to the agents sales manager/broker in their office. Your question may need to provide us with more clarity so that we can help.

The shortest answer is--if a realtor shows you the property while representing you, they are entitled to the commission.

This is an ethical and legal issue. It does boil down to "procuring cause". The theory of procuring cause comes down to this;

"Commission disputes boil down to what is referred to in the industry as "procuring cause." The agent who ultimately caused the buyer to purchase the home and earned the commission is the procuring cause agent. That procuring cause agent might not be the agent who obtained the offer from the buyer, presented the offer and successfully negotiated the seller's acceptance of that offer."

Here is the full article. There are many other direct cases where the issue of commission entitlement is discussed in NAR publications. The gist of the dilema is this;

The Arkansas Supreme Court stated that procuring cause is not the squirrel who picks the nuts but the squirrel who shakes the tree.

Procuring Cause according to Black's Law Dictionary is " the proximate cause, the cause originating a series of events which, without a break in their continuity result in the accomphishment of the prime objective."

the agent has a duty to the seller to present all offers no matter what the offer is. it is not up to the agent to determine what is good or bad. The agent is breaching the code of ethics right there. As far as commissions, you can go to another agent and as long as you didnt sign a buyer broker agreement and if the other agent can make this work where trhe first could or did not, then they can be considered teh procurring cause and be do the commission. question though, did you put the agent in directly with the selling agent and not through an agent representing you.? because if this is the case, what makes you think the listing agent will take an offer from another agent if they wont take it from you. if this is teh case you need to go to the broker of record for the office, go to the top and file a complaint. good luck

Paul: You are 100% right, and your ethics training was dead on. When an agent is the procuring cause that brings about a sale, they are entitled to their share of the commission.

HOWEVER, the concept of "procuring cause" is not as simple as you suggest. An agent does not become the "procuring cause" simply by making a prospective buyer aware that a particular property is available for sale. Nor does the agent automatically become the "procuring cause" by arranging a showing of the property, even if that agent is the one who actually conducts the showing.

To become a "procuring cause", the agent must be, at the very least, willing to assist the 2 parties in reaching an agreement. In the case described by Stan, the agent showed the property, and took an offer, but denigrated the offer by calling it "a low offer" and indicated that he/she was not willing to participate in any further negotiation in an attempt to strike a deal.

If the parties had attempted to negotiate a deal behind the agent's back, then he could rightfully assert that he was the "procuring cause", and that the parties intentionally excluded him from the negotiation that led to the successful deal. In this case, the agent voluntarily withdrew from participation in the making of the deal, because he felt as if the offer apparently personally insulted him - and that there was no possibility that a deal would ever be struck.

Consider the more exaggerated situation where an agent shows you a home, and you say to the agent, "I want to offer $100,000". The agent tells you that he would not even be willing to be a participant in making that low of an offer and asks you never to call him again. You go to the door and offer the owner $100,000 in person, and after a brief exchange the two of you agree that he will sell you the house for $115,000. Now here comes your agent, demanding his commission, because he told you about the house and took you to see it. That is not all that different from what happened in this situation. The agent specifically told Stan that he didn't want to have anything more to do with the deal and now Stan, wants to engage another agent who will actually assist him in negotiating on the property. Do you honestly think that agent #1 is the procuring cause and deserves a commission? Nonsense!

No other agent is trying to barge into this deal. The buyer is looking for an agent who will represent him properly. If you want to preach ethics, the ethical failing is on the part of the agent who refused to represent his client's interest.

Best wishes,

Angela

Hi,
To answer your question YES, the agent that first showed you the property can show procuring cause of the sale and put in for the commission. The other agent did nothing but write up an offer based on what you saw that another agent showed you. It is in our (Realtors) Ethics training. And it is just this that gets me so upset with Realtors and Real Estate agents out there flying by the seat of their pants. Probably being told by their broker that it is Ok practice to let your buyers call other agents, settle on a property and have them write it up. Then collect a commission for doing nothing. These people need to get out of the business.
Good luck
PAUL

Stan: I'd say no. They're not entitled to the commission. They seem to be very negative and unwilling to represent you in this transaction and therefore not entitled to be compensated. After all, it's one thing to be ambivalent about an offer but to be negative, as you describe, is another thing.

Of course, there could be more to the story than your one paragraph but based on what you've told us, I say definitely No. We don't get commission for saying "there's a house over there, go negotiate it yourself"!!

Good luck to you and if I can do anything to help, let me know!

Angela
Villa G Realty.