Home Selling in New York>Question Details

JIM TURANO, Real Estate Pro in Middle Village, NY

AN EXCLUSIVE RIGHT TO SELL CONTRACT THAT PRECEDES OTHER CONTRACTS IS THE CONTRACT IN FORCE, RIGHT OR WRONG?

Asked by JIM TURANO, Middle Village, NY Thu Jul 24, 2008

REALTOR A, CONTRACTS A HOMEOWNER WITH AN EXCLUSIVE RIGHT TO SELL CONTRACT ON APRIL 19, 2008. BROKER SELLS THE HOUSE BUT CONTRACT IS HELD UP BECAUSE OF CO.
OWNER NOW SIGNS EXCLUSIVE WITH REALTOR B IN THE INTERIM. HE SELLS IT FOR MORE MONEY, HOWEVER REALTOR A IS CONCERNED IT WON'T APPRAISE ANYWAY FOR NEW PRICE. SO SINCE REALTOR A WAS CONTRACTED PRIOR TO REALTOR B, REALTOR A PRECEDES LEGALLY REALTOR B. HOWVER, DOES THE OWNER PAY TWO COMMISSIONS IF SHE WANTS TO PROCEED, OR DOES REALTOR A TELL REALTOR B YOUR OUT OF THE PICTURE ALL TOGETHER.
NEW YORK REALTOR

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I'm not a lawyer, so this isn't legal advice. But I think Elvis has it right.

If there was an agreement between Realtor A and Client, then that agreement should remain in effect as written unless there was a provision in the agreement that allowed the client to negate the agreement. The agreement could also be terminated or modified by consent of all the parties to the agreement.

However, if there wasn't a termination provision in the agreement and the agreement wasn't terminated by mutual consent of all the parties to the agreement, then the agreement between Realtor A and the client remains in force.

The question then arises as to whether the client had the ability to sign an exclusive agreement with Realtor B. Or, more accurately, whether such an agreement could be enforced. My guess is that a lawyer would say no.

As a practical matter, one resolution to the issue would be for Realtor A and Realtor B to share the commission. From a legal standpoint, though, one or the other (my guess is Realtor A) would be entitled to the entire commission.

Again, though, you need a lawyer to review the documents and provide an opinion.

Good luck.
1 vote Thank Flag Link Thu Jul 24, 2008
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
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I'm not a lawyer, so this should not be construed as legal advice.

Read the agreement signed with Realtor A. Often those agreements contain a phrase that talks about a protection period (3-6 months) if the house sells due to the efforts of RealtorA, with someone who saw it while they were showing.

BUT (and this is an important "but")... if they sign up with a new agency... the new agency's contract (REALTOR B) supercedes the first contract.

The fly in the ointment here, is: did the seller have the "right" to exit the contract with RealtorA? Was there ever a mutual release?

without more information, the water here is very very muddy.
1 vote Thank Flag Link Thu Jul 24, 2008
Alan May, Real Estate Pro in Evanston, IL
MVP'08
Contact
Realtor A has the exclusive first. He informed Realtor B, forwarded a copy of the Exclusive agreement to be reviewed. And Realtor A is willing to Co-Broke to Realtor B since he has a ready willing and able client. The commission is shared 50-50%, and seller was advised by her attorney that is the proper solution. Surprised still getting replys from 4 years ago.
0 votes Thank Flag Link Thu Mar 15, 2012
Ask an Attorney for a proper response. The only thing I would comment on is the following. The Realtor obviously didn't do their due diligence regarding this property. The broker failed to realize there was another owner. This broker either didn't ask the right questions or is too new on the job to realize he/she didn't ask the right question. It is quite easy to check city documents regarding ownership. Brokers do it all the time.

I am NOT an Attorney but I might think the original contract as well as the later is unenforcable as both owning parties didn't fully execute the listing agreement. Just my two cents. I would be curious to know the final answer. Good luck.
0 votes Thank Flag Link Wed Mar 14, 2012
This is an interesting scenario bu It is really hard to comment on it without at least knowing the contract expiration date for Realtor A and other relevant information...Which one are you, A or B?
0 votes Thank Flag Link Wed Mar 14, 2012
Jim, NON LEGAL ADVICE GUESS: Because NY contracts permit a seller to accept offers up until the property closes, unless your buyer was counseled to add an addendum to the contrary (as we have advised buyers in the past to explore with their lawyer, as Realtors are not permitted to write the addendum in New York), Realtor B's offer, if accepted by the seller, is the offer for which compensation is due. Realtor A and their buyer are sol, if I'm understanding the dilemma correctly.
Web Reference: http://optionsrealty.com
0 votes Thank Flag Link Thu Jul 24, 2008
I am a Realtor, not a lawyer which is what you need. I do not give legal advice.
0 votes Thank Flag Link Thu Jul 24, 2008
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