Q: Can an agent working for a broker (First Team Real Estate) sue you for cancelling the listing agreement?
Would not the broker have to sue as the agreement clearly states said agreement is between the seller and broker. The seller informed the agent verbally she wanted to cancel the agreement as the agent in 6 weeks from the agreement being written up had done nothing towards selling the house. No for sale sign at the property, not one person shown the house, and when the agent was asked why nothing was being done she responded her mother was ill and she was taking care of that. She was advised at that time by the seller to cancel the agreement. She verbally agreed to do so, but obviously never informed the broker. Another broker was retained and the house sold to the first party it was shown to. First Team Real Estate has not pursued this matter in any way. Now the agent is stating the agreement was between the seller and herself, even though it clearly states the agreement is between seller and broker. She now wants to sue for the 5.5% commission on the listing price of the house.
A: Anyone can sue at any time. The real issue is whether they can win, and what the cost will be to deal with the lawsuit. The question of "standing", that is, whether a party has the right to bring a suit, is beyond the scope of this type of question and answer forum. It will require an analysis of the particular agreement and a review of the facts. There are also issues as to whether you may potentially recover attorney fees, and whether the action is subject to mediation and/or arbitration. One thing for certain, you must file a legal response, on time, to the lawsuit. If you do not, you may lose, simply because you did not take the proper legal steps to protect your rights. Contact an experience real estate litigation attorney right away.
A:
While the agent is always responsible to the Broker, the answer to your question probably lies somewhere in the listing agreement. Some listing agreements specify that the agreement cannot be canceled for a certain period of time. In my opinion, since the first agent did nothing, she has no grounds to receive any part of a commission. In my experience, most agents will simply forego the commission rather than get into a long, protracted lawsuit over it. I doubt that First Team Realty will pursue the matter. You should let them know that you will not pay any part of the commission to First Team Realty. Since I have not reviewed the pertinent documents, I cannot guarantee the results. Good Luck.
Tom Grossman, Esq.
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