Giordano, Halleran & Ciesla, P.C. Obtains Favorable Ruling

December 3, 2010 - Red Bank, NJ - The Monmouth County Association of Realtors recently rendered a decision in favor of Giordano, Halleran & Ciesla’s client, a prominent New Jersey real estate brokerage firm, on a "procuring cause dispute" involving the sale of multi-million dollar home and a six-figure commission. Robert J. Feinberg, Esq., a Certified Civil Trial Attorney and shareholder in the firm’s litigation and real estate practice areas, represented the Respondent brokerage firm. Mr. Feinberg was assisted by Michael D. Pawlowski, Esq., an associate in the firm’s litigation department.

In any real estate sale where a broker and commission are involved, a broker who is the legal “procuring cause” of the sale is generally entitled to a commission. The procuring cause of the sale is the individual who’s efforts are the foundation of the eventual sale. While most familiar is the clear cut case of one broker who shows their client a property, negotiates for the sale up to the point a contract is executed, and because of these efforts, a closing occurs, the actual determination of procuring cause is a highly fact sensitive legal issue which can quickly become complex in cases that are not “clear cut”.

Pursuant to the regulations governing the Monmouth County Association of Realtors, all members agree that, in the event of a procuring cause dispute, the matter will be submitted to binding arbitration. Complainant in this case, also a prominent real estate brokerage firm, alleged that its broker was the procuring cause of the sale. While complainant had shown the property to its eventual purchasers while representing them, the purchasers, due to dissatisfaction with the services being rendered, terminated the broker. The broker unilaterally continued to contact and prospect the purchasers, who began to search for homes independently, contacting only listing agents. Subsequent to obtaining independent information of a price drop on the property, the purchasers contacted the listing agent, our client, directly. This contact resulted in our client, acting as a disclosed dual agent, successfully negotiating the sale of the property. Complainant alleged that she was the procuring cause of the sale based on the prior, and allegedly continuing, work done for purchasers and the original introduction of purchasers to the subject property.

The arbitration panel, in following established New Jersey cases such as Weinstein v. Clementsen, 20 N.J. Super. 367 (App. Div. 1952) and C.B. Snyder Realty, Inc. v. BMW of North America, Inc., 233 N.J. Super. 65 (App. Div. 1989), correctly recognized that mere introduction of a buyer to a property does not entitle a broker to a commission, and in this case, based on the facts elicited during examination of the relevant witnesses, recognized that a broker, simply by finding a potential customer does not acquire an exclusive right to develop that interest into an actual business transaction.

The successful defense of the procuring cause claim represented an important victory for the brokerage firm in this legally complex and highly fact sensitive area of the law. With our client’s reputation, and commission secured, Giordano, Halleran & Ciesla was proud to have produced a favorable result, in a cost-efficient, timely fashion. Mr. Feinberg and Mr. Pawlowski remain available to discuss your inquiries regarding legal disputes in the real estate sector.

Tags: Robert J. Feinberg, Michael D. Pawlowski, Litigation

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The Giordano Law Firm is centrally located in Red Bank, New Jersey, Monmouth County, minutes from the Jersey Shore. With an office in Trenton, the attorneys of the firm regularly work with clients and in Courts statewide from Newark to Atlantic City, Morristown to Roseland, Camden to Princeton, and beyond.