The Summit Real Estate Group v. Bernard Fallon, et al.

Verdicts & Settlements   ·   October 1, 2001

California Daily Journal

The Summit Real Estate Group v. Bernard Fallon, et al.

(OOCC05384)

Result October 01, 2001

Orange Superior
HON Mason L. Fenton

Topic: Real Property
Sub topic: Purchase Agreement
Sub-sub topic: Commission

Jury verdict: The defendants’ motion for nonsuit was granted on the basis of the statute of frauds

Attorneys:
Plaintiff – Eric P. Francisconi, Barnes, Crosby, Fitzgerald & Zeman, Irvine
Defendant – Martha J. Mosier, Coldwel Banker, Mission Viejo
Defendant – Jeffrey S. Benice, Law Offices of Jeffrey S. Benice, Irvine

Facts: The defendants had retained the plaintiff real estate brokers to locate a purchaser for their home. The plaintiff acted as the defendants’ real estate broker pursuant to an agreement entered into by the parties on Aug. 11, 1999. This agreement expired six months later on Feb. 11, 2000. At no time during the plaintiff’s six-month listing did they present any offer to the defendants to purchase the property. Two weeks later, on Feb. 26, the defendants signed a new listing agreement with a different broker, the co-defendant- defendant Coldwell Banker. Shortly after the listing agreement expired with the plaintiff, the plaintiff previewed the defendant’s home to a potential buyer with the defendant’s knowledge and consent. At the time of the expiration of their listing agreement, Feb. 11, 2000, this potential buyer had not seen the home nor made any offer to purchase it. However, as an accommodation to the plaintiff, the defendants orally granted the plaintiff an additional time period to March 27, 2000 in order to conclude a purchase transaction with the potential buyer. During the extension period, the plaintiff presented an offer from the potential buyer and the defendants made several counter offers. The defendants’ final offer to sell the property was at $4,586,000, and the potential buyer’s final offer was $3,907,000. The counter offer’s terms mandated that if the prospective buyer failed to respond by March 20, 2000 it was deemed “revoked.” The prospective buyer failed to respond on March 20, 2000. On March 29, 2000 the same buyer submitted a new offer through the defendants’ new broker, the co-defendant Coldwell Banker. During the period March 29, 2000 to April 7, 2000 the defendants and the potential buyer exchanged six counter offers. On April 7, 2000 the defendants and the buyer reached an agreement, and the defendants sold their residence to the buyer for $4.1 million and the co-defendant broker, Coldwell Banker, received the entire real estate commission.

Contentions: The plaintiff contended that it was entitled to the commission received by the co-defendant Coldwell Banker. The plaintiff claimed that the defendants had agreed to “protect” the plaintiff’s commission in the event that the specific potential buyer were to purchase the property, that it was the plaintiff who procured the sale and that plaintiff had registered the buyer in writing under the listing agreement’s “safety clause.” The defendants contended that the offer that they had received from the buyer while the plaintiff was the real estate broker had expired, and that the co-defendant Coldwell Banker had become the listing agent. Thus, the defendants argued, the plaintiff’s claim was barred by the Statute of Frauds.

Damages: The plaintiff claimed $126,000 in damages arising from the unpaid real estate commission.

Settlement Discussions: The plaintiff demanded $60,000 before trial. The defendants made no offer.

Other Information: After the plaintiff had rested its case, the defendants moved for a nonsuit. The co-defendant Coldwell Banker settled at the beginning of trial.