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Richard
Richard, Lawyer
Category: Real Estate Law
Satisfied Customers: 46017
Experience:  32 years of experience as lawyer in Texas. I'm also a Real Estate developer.
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I currently have a commercial property listed with a real estate

Customer Question

I currently have a commercial property listed with a real estate agent in Pennsylvania. We are considering withdrawing the property since they have done little to sell it and feel there is a conflict of interest since the owner of the firm is selling competing properties in the same town. Should we withdraw early we would pay a $500 fee to the real estate. Does this fee then release us of any other obligations to them? They have a standard contract that states when the contract ends they would still have 60 days to receive a fee should we sell the building. Does this just mean to buyers they showed it to or anyone? And if we withdraw does that still apply or are we basically gridlocked from selling it for at least 60 days after the contract end even if they did not show it to the person? And regarding that, if we were to show the property ourselves to someone while under contract with them...do they still get a fee even if they have no involvement?
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Richard replied 1 year ago.
Welcome! My goal is to do my very best to understand your situation and to provide a full and complete answer for you.


Good morning. Can you post a copy of your agreement or the applicable provisions so I can give you complete information? Thanks.
Customer: replied 1 year ago.

What additional info do you need?

Expert:  Richard replied 1 year ago.
Can you provide the language of termination in your agreement and the payment of the $500? If not, I can provide you information how the typical contractual arrangement would work.
Customer: replied 1 year ago.

Under the title Brokers fee....It states the "Brokers fee in the case of a sale is as follows: (these are hand written in)....6% on net sales price after any sellers assist.


 


* A $500 payment is paid to Villager if property is withdrawn prior to 7/18/13


 


That is all that is noted there....


 


The only other info is in the standard contract that states in a later paragraph...


 


* Owner will pay a brokers fee after the lease ending date of this contract IF:


(1)The property is sold, leased or exchanged in whole or part within 60 days of the ending date, AND (2) the property was presented to buyer/tenant or negotiated to buy or lease teh property during the term of this contract. Owner will not owe brokers fee under the provisions of this paragraph if after the expiration of this contract owner has entered into an exclsuive right to sell or lease contract for the property with another broker at the time of sale.

Expert:  Richard replied 1 year ago.
Thanks! Basically, you won't have to pay any fee unless: i) the property is sold/closed within the 60 days to someone to whom your existing broker had shown the property, and ii) you have not entered into a broker agreement with someone else for the sale. That is black and white. It is likely the broker would prevail in a suit for the commission even if you pay the $500 if you don't re-list it and sell it to someone to whom they showed the property within the 60 days. They will need to designated who those potential buyers are when you terminate. But, here's the reality, given the language of "sold, leased, or exchanged within 60 days, you should be able to easily avoid a commission because even if you enter into a contract within the 60 days, it's not likely a closing would occur within the 60 days due to the due diligence process involved in a commercial property transaction.



Thank you so much for allowing me to help you with your questions. I have done my best to provide information which will be helpful to you. If I have not fully addressed your questions or if you have any follow up questions, or if I have misinterpreted your questions in any way, please do not rate me yet, but simply ask a follow up question without rating so I can provide you with a fully satisfactory answer. If I have fully answered your question(s) to your satisfaction, I would appreciate you rating my service with 3, 4, or 5 faces/stars so I can receive credit for helping you today. I thank you in advance for taking the time to provide me a positive rating!
Richard, Lawyer
Category: Real Estate Law
Satisfied Customers: 46017
Experience: 32 years of experience as lawyer in Texas. I'm also a Real Estate developer.
Richard and 10 other Real Estate Law Specialists are ready to help you
Customer: replied 1 year ago.

Thank you... May I just as for a little more clarification?


I am thinking of ending the contract early because I feel they have conflicts in their interests and are not even remotely trying to sell the building. We have not shown, negotiated or in any way contracted with anyone else...but we have spoken with a personal friend who has never spoken with our real estate in any way...but they would like to see the building...There is nothing but casual conversation and they want to see it and have us show them...For reasons already mentioned we are considering withdrawing the contract early either way but I am concerned as to what then could happen should our friends eventually show an interest.

Expert:  Richard replied 1 year ago.
You're welcome and thanks for following up. In this instance, since this is a friend and the friend has no contact with your listing broker, you could terminate now and would not owe a commission. Furthermore, no matter what, you could allege the listing broker is in default due to the conflict of interest and failure to adequately perform. Given your situation...the conflict, the distrust, and the possibility of making a deal with your friend...your best bet is to terminate immediately so you can start the 60 day countdown and eliminate all question.
Expert:  Richard replied 1 year ago.
Thank you so much for the positive rating! I appreciate having had the opportunity to serve you! If I can be of assistance to you in the future, just look me up and I will be happy to help! For easy access, my bookmark is: http://www.justanswer.com/law/expert-legalbeacon/
Expert:  Richard replied 1 year ago.
Thank you also for the generous bonus! I appreciate your kindness!

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