Coldwell Banker Prime Props. v Abat

[*1] Coldwell Banker Prime Props. v Abat 2007 NY Slip Op 51804(U) [17 Misc 3d 1103(A)] Decided on July 31, 2007 City Court Of Albany Heath-Roland, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on July 31, 2007
City Court of Albany

Coldwell Banker Prime Properties, Plaintiff,

against

Jonathan P. Abat, Defendant.



COM 07-0029



David I. Bacon, Esq.

Attorney for Plaintiff

350 Northern Boulevard, Suite 301

Albany, NY 12204

Roy K. Nestler, Esq.

Nestler & Gibson

Attorney for Defendant

5 Computer Drive West, Suite 202

Albany, New York12205

Helena Heath-Roland, J.

Plaintiff commenced this Commercial Claims action to recover $5,000.00 for damages resulting from defendant's alleged breach of a contract to purchase real estate. A Commercial Claims trial was held on May 22, 2007. The Court makes the following findings of fact:

Defendant and his wife entered into a contract for the purchase of a newly constructed house with Rosewood Home Builders, LLC ("builder") on July 28, 2006 (Plaintiff's Exhibit 1). They gave the builder a $5,000.00 deposit as a down payment on the contract. The contract included a mortgage contingency clause (paragraph 11) that allowed the purchasers (defendant and his wife) to terminate the contract should they be denied a mortgage after applying for same within five days of the contract date. However, the purchasers failed to apply for a mortgage within five business days of signing the contract as required. Defendant then attempted to terminate the contract as he and his wife had decided that they no longer wished to purchase the property for personal financial reasons. The builder retained the $5,000.00 deposit as damages for the purchasers' breach of their contract. [*2]

At some point prior to trial, the parties to the contract signed a disclosure notice, which is undated, stating their acknowledgment that Diane M. Van Alstyne, of Richard G. Rosetti Real Estate, represented the builder/seller as its agent and that Paul Shannon, of plaintiff Coldwell Banker Prime Properties, represented the purchasers as their agent (Plaintiff's Exhibit 2). No other terms, such as agent compensation, were a part of this acknowledgment. Plaintiff produced no testimonial or documentary evidence at trial that there had ever been any discussions between plaintiff and defendant regarding situations where defendant may become responsible for plaintiff's commission, such as if the closing on the subject house did not occur or for any other reasons. Significantly, the contract included a clause (paragraph 13) that states that the "builder agrees to pay the broker's commission as per the listing agreement".

Section 1804-A of the Uniform City Court Act sets forth the procedure to be followed when conducting a Commercial Claims trial. The Court is required "to do substantial justice between the parties according to the rules of substantive law..." (U.C.C.A. § 1804-A; See Also, Blair v. Five Points Shopping Plaza, Inc., 51 AD2d 167, 379 NYS2d 532 [3d Dept 1976]).The party bringing a claim, however, does bear the burden of proving its case. The claimant must produce enough evidence to allow the Court to rule in that party's favor.

As a general rule, absent a contrary agreement, "a real estate broker will be deemed to have earned his commission when he produces a buyer who is ready, willing and able to purchase at the terms set by the seller" (Lane-Real Estate Dept. Store v Lawlet Corp., 28 NY2d 36, 42 [1971]). A realtor's commission is not dependent on an actual sale of the property "unless the brokerage agreement with the vendor specifically so conditioned payment" (Hecht v Meller, 23 NY2d 301, 305 [1968]).

In the instant case, while it appears that plaintiff was procured as the agent of defendant and his wife, there is no evidence of a contract between the parties for plaintiff's services. "In the absence of a contract, express or implied, a broker is entitled to receive a commission in a reasonable amount for bringing together the parties to a transaction" (Curtis Properties Corp. v Greif Companies, 212 AD2d 259, 266 [1st Dept 1995] citing Sibbald v Bethlehem Iron Co., 83 NY 378, 380-381[1881]). In Curtis Properties, while there was no express or implied contract, the First Department found that equity required that the broker recover for its services in quantum meruit since it could establish the following: "(1) the performance of the services in good faith, (2) the acceptance of the services by the person to whom they are rendered, (3) an expectation of compensation therefor, and (4) the reasonable value of the services" (Curtis Properties Corp. v Greif Companies, supra , at 266-267 citing Martin H. Bauman Assocs. v H & M Intl. Transp., 171 AD2d 479, 484 [1st Dept 1991]).

Under law, it cannot be assumed that a broker works gratuitously, and a broker's clients are held to such knowledge when they accept the result of the broker's services (Gronich & Company, Inc. v 649 Broadway Equities Co., 169 AD2d 600 [1st Dept 1991],citing Colvin v Post Mortgage and Land Co., 225 NY 510 [1919]). Plaintiff established at trial that Paul Shannon performed services in good faith as an employee of plaintiff to assist defendant in the purchase of a home. Likewise, it was established that defendant accepted those services. In this case, however, plaintiff has failed to establish that there was any expectation by either plaintiff or defendant that defendant and his wife would be compensating plaintiff for its services. To the contrary, the overwhelming evidence establishes that the parties expected that the builder would be paying the broker's [*3]commission for both the seller/builder's broker and for the buyers' broker, and this expectation was memorialized in the purchase agreement. Furthermore, in preparation for closing, plaintiff sent Rosewood Home Builders a bill for plaintiff's share of the broker's commission in the amount of $7,500.00 (Defendant's Exhibit A). Therefore, the Court finds that plaintiff did not establish that there was an expectation by either party that defendant would pay plaintiff a commission for its services. Additionally, plaintiff failed to submit sufficient proof at trial to establish the reasonable value of plaintiff's services.

In sum, the Court holds that there is no evidence of a written, oral, express, or implied contract requiring defendant to compensate plaintiff for any of the services it performed on defendant's behalf, and plaintiff did not establish its entitlement to recover for its services in quantum meruit. Despite its efforts, plaintiff failed to meet its burden of proof. Accordingly, the Court must dismiss plaintiff's claim.

So ordered.

Dated at Albany, New York

July 31, 2007

____________________________________

Helena Heath-Roland

Albany City Court Judge