The Supreme Court, in the Judgment of May 21, 2014, established a legal precedent that the broker entrusted with the sale of a home has the right to full compensation of the agreed commission when his or her management is decisive or determinant for the “positive outcome” or “success” of the transaction, independently of whether the sale is made by the seller without his or her knowledge and the final price is the same.
This Judgment is, in reality, the continuation of a previous and recent one of the Supreme Court of March 8, 2013 that defined the “success of the brokerage” as the assumptions in which the activity of the broker determines the existence of the framework or business relationship that makes possible the goal of attainment desired by the seller, independent of his or her own consummation of the sale.
It established, for example, that with the signing of a contract for option to purchase, it must be understood that this framework of business relationship occurs in favor of the seller, allowing the goal of attainment (completion of the sale), independently of whether said option is or is not exercised by the grantee. That is, unless the seller and the real estate agent agree that earning and paying the commission shall take place only when the operation has been concluded.
It must be recalled that at times the Courts, including the Provincial Court of Baleares, have interpreted that only “placing in contact” a seller and interested buyer does not necessarily mean that the brokerage has earned the right to commission- if, for example, the home in question simply was “shown” or visited with a possible buyer- even with a sale brokerage contract. It would be necessary- among other actions by the brokering agent- to inform the owner of the result of the visit, offer the visitor as a possible buyer, detail their personal circumstances for the seller’s knowledge, the possible amount that above the initial offering price of the property he or she is willing to pay and in what conditions.
This specific case addresses the right of the broker to the compensation agreed to in the contract for sale of an apartment that, although coordinated between the parties placed in contact by the agent for the real estate property, was carried out without him or her, and for a price lower than that cited in the initial contract; considering whether the compensation of the broker is excluded or, if applicable, is liable to a discount proportional to the reduction of the final sales price. The agreed commission was established for a fixed amount and the sale price initially offered was higher than the price at which the sale finally took place.
It was verified that the broker, through his or her efforts, showed the home to a third party, who was interested in it and requested a discount, which was approved by the seller. However, on communication of said discount, the interested party indicated not being interested. Two months afterward, the interested party purchased the home by public writ, skirting the professional action of the broker.
The Judgment established that the result of the brokerage- that is, the sale of the apartment as a “success or positive outcome of the brokerage”- was accomplished through the decisive management by the broker, who not only contacted the future purchaser, but also showed the property several times. This established the framework for negotiation that made possible the goal of sale desired by the seller that, without a doubt, took advantage of this brokerage activity to complete the sale.
With regard to determining compensation, it must be pointed out that the seller and the real estate agent agreed to a fixed amount independent of the final sales price, not a percentage of the sale price. In consequence, the Court ordered the payment of the full commission agreed despite the sale price being lower than that the sale brokerage contract indicated.