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Sam
Sam, Attorney at Law
Category: Legal
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Experience:  More than 20 years of experience practicing law.
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Can a town in NY State pay a real estate brokerage commission

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Can a town in NY State pay a real estate brokerage commission upon the sale of the town's surplus property if the purchaser was brought to the transaction by a real estate broker?
Hi

Only if that is the agreement with the town. Without an Exclusive Buyer Agency agreement, then the town is not bound to pay anyone anything.
Customer: replied 3 years ago.

I am getting a contradictory answer from the town's attorney. Can you quote a specific section of the NY law that covers this issue?

Hi

What is the answer you are getting from the town, please?
Customer: replied 3 years ago.

Town attorney says that they CANNOT pay brokerage commissions.

Hi

 

Well, that is what I said. If the town is allowed to, then they will enter into an agreement with the broker. But if the Charter prohibits that, then they cannot. And so it is not a matter of a state law but rather how it pertains to the Town's Charter.

I cannot obtain a town charter online, but I suggest you can ask the Attorney to point that out to you in the Charter.

So the answer is as I said - If they enter into an agreement to pay a commission. But if not, then no they owe nothing to anyone and it may be in the Charter that it is prohibited

 

In such a case, the broker would need to have the buyer pay them a commission or agreed upon "finder's fee" so to speak. But a seller - this case being the Town - never has to pay a commission if they are not in an agreement to do so.

 

So in other words, the Town is Selling as Owner without the help of a broker.

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