Procuring Cause question. Is there a time period after I fire an agent in order to avoid procuring cause? I do not want my old agent to get anything.

Asked by Lenny, Tue Nov 23, 2010

My question is regarding Procuring Cause and specifically my old agent from getting any commission if I happen to go back to a property that I have made a bid on.

I had a horrible experience with my old agent and a deal felt through. We are still shopping round with a new agent but if the house we looked at comes back at much lower price later on in the future, if the old agent has the right to get commission? I have never heard about Procuring Cause but at this point, I don't want my old agent to get any commission. Property was initially found by me and the old agent was randomly picked through Trulia (new in town). I also want to know if there is a time limit for Procuring Cause and also what if original seller goes through another agency to sell.

Any detail information would be appreciated.

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18
Jeanne Feeni…, Agent, Basking Ridge, NJ
Sat Nov 27, 2010
Hi Lenny, I'm sorry that you had such a negative experience with your first agent - good idea to find a new one that you are more comfortable working with.

The question of commission if you buy a home for which you wrote an offer with this agent will be answered best with a full review of the documents you signed. If you were the seller, you would want an unconditional release from a listing agreement in order to move on and not owe the broker commission if you relist with another. So if you've signed documents with this agent/broker that still are valid, you'll want to be sure you are released from them, unconditionally.

Suggest you talk with an attorney about it, and also be upfront with your new agent.

And then I would suggest that you get yourself back on track and focused on what brought you to this point in the first place - finding and buying your home. Find a great agent to help you, learn from your past experience and move on.

Good luck to you,
Jeanne Feenick
Unwavering Commitment to Service
Web Reference:  http://www.feenick.com
1 vote
Jonathan Rai…, Agent, Macon, GA
Tue Nov 23, 2010
This is a question for your agent and for your agent's broker. Your situation is so unique that it can't be reasonably answered on a forum like this one. You may even need to consult an attorney to review any contracts you had in place.

Your current agent needs to know about this situation you're in. There are state laws that protect the previous agent's work, and they may or may not apply to your previous offer. The current agent could be affected by them. Talking with your current agent AND your current agent's broker at the same time could help clarify the issues. Again, if you don't feel satisfied or they can't help you, the few hundred bucks it would cost to consult an attorney could be worth it to avoid a legal battle. If the previous agent even thinks they are due anything, then they could come back years down the road and demand a commission (whether they are right or wrong, they can still sue).

Best of luck!
Web Reference:  http://jonathanrainer.com
1 vote
Realtor Carm…, Agent, Marietta, GA
Fri Mar 18, 2011
Yes there is a time called, Protected Period, and you could find that in your buyer brokerage agreement righ after the commission paragraph.

Did you brake the brokerage agreement before the expiration date? If so, you needed to give written notice to the agent and have the agent written consent to release you from any fees due.

I will advise to read your brokerage agreement or get a copy from the broker if the agent did not provide you one.

Best luck!

Carmen Gutierrez
Marietta Realtor
0 votes
Jonathan Rai…, Agent, Macon, GA
Thu Mar 17, 2011
Lorene,

That is a question that needs to be posed to an attorney. It is beyond the scope of an agent's ability to answer. The seller should seek qualified counsel right away.

I hope it turns out well!
0 votes
Lorene, Home Owner, Chandler, AZ
Thu Mar 17, 2011
I called a real estate agent from her sign to ask her the stats about the house. She told me 4 BR and I needed 5, so I said I am not interested. that was in 2009 when the property was listed with her
Later in March of 2010, she listed the property again after the other listing expired for over 4 months and 2 months later there was a For Lease By Owner on the house. In Dec. I called the owner, was shown the property and ended up with an owner carryback contract which closed in January. I found out the Seller had asked that his Listing Agreement be cancelled in Sept and he put up a sign of his own to lease. She said ok and that she would send him something in writing cancelling his contract, take it out of the MLS and take her sign down. she did all except send written cancellation. She is now suing for a commission saying she was the procuring cause. IS THIS TRUE??? DOES THE SELLER HAVE TO PAY HER
0 votes
Leigh Hays, Agent, Altanta, GA
Sat Nov 27, 2010
You should consider talking to an attorney who knows real estate law for your questions. They should review the documents signed including correspondence. You are asking for an interpretation of the law. At the end of the day - your agreement with the previous brokerage/agent is between you and the other agent and your 'new' agent should steer clear of interpreting the real estate law though you should be sure the agent and the agent's broker are very clear on what has transpired.

If the previous agent has a claim to the commission they will most likely come directly to you via your Brokerage Agreement with them and not to the new agent. And if you are terminating an BBA and then wanting to buy the same property you wrote with the 'old agent' you should seek the advice of an attorney on the termination as well.

Most of your quesitons deal in the fine arts of real estate law and you would be better served by talking about your specifics with an attorney who know real estate law.
Web Reference:  http://www.leighhays.com
0 votes
Michael Hamm…, Agent, Suwanee, GA
Tue Nov 23, 2010
After first seeing your post earlier today, Lenny, and the initial threads explaining your options, I decided to pass on answering as didn't feel anything more need be added. But as it has gotten increasingly interesting with your follow up, please allow me to add something. Not being a lawyer, I cannot tell you exactly what procuring cause would likely be in your particular situation. I can, however, tell you what a legal definition might be, as interpreted by a judge in a civil case, based on the following:

“In the context of a real estate transaction, procuring cause refers to actions that begin or set in motion a serious of events that lead to the final sale of a property. Under some state laws, which vary by state, a real estate broker may be entitled to a commission as a procuring cause of a sale if the broker brought the purchaser and seller together and brought about a sale through continuous negotiations initiated by him, unless the seller and buyer intentionally exclude the broker.

Typically, for the broker to be entitled to the commission, it must bring together the seller and purchaser, and not just a person associated with the seller or purchaser. The broker must often be involved in the negotiations between the buyer and seller to be entitled to a commission. The mere act of informing a potential purchaser, who eventually purchases the property, about a prospective purchase may not be enough for the broker to be a procuring cause in the sale. The precise definition depends on state law and the facts and circumstances in each case.”

If, as you earlier wrote, the former agent showed you the property AND submitted an offer which was not accepted, then based on the definition above, he might well be entitled to a commission, particularly if you and he signed a BBA. Since you are this irate, my question would be, is the previous agent just as mad? If so, and you follow through with the eventual purchase of the property in question, it may well take an arbitrator to settle this.

Michael Hammond
SellsRealty@gmail.com
404-538-5499

http://www.SellsRealty.org
0 votes
Hank Miller, Agent, Alpharetta, GA
Tue Nov 23, 2010
Easy Lenny - I'm a born and bred NY'er and even I have a hard time getting that much venom up. At the end of the day, it depends on the terms in the brokerage agreement. Let the other agent know which property is in question, you can share your feelings regarding the first agent and let them handle i agent to agent/broker to broker..

I've picked up clients after bad experiences, at the end of the day we bought the house that the client wanted. I've heard of agents that reach out and offer the previous agent a referral; I also know several that could care less about previous agents. If issues arose, they were dealt with - if not, life goes on.

Go buy the house you want - if that other agent fumbled the deal then that's tough, maybe they'll learn from it. Just make certain your current agent is briefed on everything and let them handle things.

Hank
Web Reference:  http://www.hrmiller.com
0 votes
Gary Kaupman, , Ellijay, GA
Tue Nov 23, 2010
Lenny,

Yes there is a time limit. It is in your agreement with you previous agent. If you did not have a written Buyer's Agency agreement with your previous agent, then you'd need a read from a Real Estate Attorney as to how long procuring cause might last.

More important it seems to me you are cutting off your nose to spite your face, if you let your "hatred" get in the way of having the house you want at the price you want.

So, another suggestion: Ask you current agent to contact the previous agent and ask if (s)he would agree to quit any claim to a commission in this case. You might just get a "Yes"' and if not, you can get on with looking.

Hope your Thanksgiving is filled with joy,

Gary
0 votes
Lenny, ,
Tue Nov 23, 2010
I realized that all of you answering my question are agents.

Regarding to Gary's comment. I'm sure my agent feels that he/she is happy to get rid of me until he/she realized sale will not be made with me. That being said, I'm sure you all have dealt with horrible client and I could be consider one of them by this post.

I have already stated my issues with my current agent and she has stated to me that she is wiling to share the commission with the previous agent. I had just a horrible experience, I want to find out myself so that my previous agent DO NOT get the commission IF I happen to decide at the end to go with the property in which I found and all he did was to show and file the bid. At this point, I'm just making sure if its possible if I go with what I saw.. If not, my hatred toward my previous agent is so great that I'm willing to not consider previous property just so he/she doe not get the commission of any kind because of my purchase.
0 votes
Andy Philhow…, Agent, Atlanta, GA
Tue Nov 23, 2010
If you had a Buyer Agency Agreement with this Agent, you will need to terminate the Agreement.
0 votes
Gary Kaupman, , Ellijay, GA
Tue Nov 23, 2010
Lenny,

When a buyer who has fired a previous agent comes to me, here's what I tell them.

In the event that you wind up putting a contract on a house that you saw while you had another agent, then it is my issue to deal with that agent about who gets paid.

My experience is that agents who were fired are generally as happy to rid of the client as the client is to be rid of the agent. And so, have no expectation of earning any money as a result of the former relationship.

So, when I offer the fired agent a referral fee as a courtesy, they generally are very happy. I suspect you can find a new agent who thinks this way.

Gary Kaupman
Dixon Gary Realty
0 votes
Bill McGoldr…, Agent, Atlanta, GA
Tue Nov 23, 2010
The first question is: did you sign a buyer brokerage agreement? If so, read the stipulations contained in it. You may be responsible for a commission if you purchase that home with another agent. If you did not have a representation agreement then all you have to worry about is whether you can get a new agent to risk a procuring cause case with their local board. If enough time has gone by since your dismissal of the original agent, the odds are pretty low that he/she will follow up with a post closing tax search to see if you ever purchased the property.
0 votes
Realtor Carm…, Agent, Marietta, GA
Tue Nov 23, 2010
Hello Lenny,
It is always recomended that you terminate your brokerage relationships in writing and save a proof but, if the agreement has expired, go back to your Exclusive Buyer Brokerage Agreement and read paragraph 7. Protected Period and Commission, you will see there how many days your agent filled in the blank on the "Protected Period" Your new agent should be aware of this too.

Carmen Gutierrez
Solid Source Realty
Cell 770-366-1487
0 votes
Scott Askew, Agent, Atlanta, GA
Tue Nov 23, 2010
As Anna stated, the answer lies in your Brokerage Agreement with your old agent and it is best to advise your current agent.
Transactions often fail due to no fault of the agent.
0 votes
Jeff Guynn, , Atlanta, GA
Tue Nov 23, 2010
I concur with Anna Brocco. Best course of action is direct this question to the agent you are working with now since they have a vested interest in fighting for a positive outcome for both of you.
Web Reference:  http://www.theguynnteam.com
0 votes
Dustin Rappa…, , Atlanta, GA
Tue Nov 23, 2010
All of this should be answered in the contract the two of you have executed. Read through that CAREFULLY !!! All of your concerns should be explained in that.
0 votes
Anna M Brocco, Agent, Williston Park, NY
Tue Nov 23, 2010
Since you mentioned you are shopping with a new agent, consider referring the question to your agent as his/her commission could be affected--much would also depend on your agreement with your previous agent.
0 votes
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