[WSBARP] liability for a commission under a "referral agreement" with an unlicensed person

[Rod Harmon]

An out-of-state real estate broker entered into a "Referral Agreement" with
a property owner (Seller) with respect to commercial real property in this
state.  The key provisions of the agreement are:

1.      Broker will provide property information and contact information for
Seller to prospective buyers for the property with the intent that buyer
will submit an offer on the property with the intent to purchase the
property.  

2.      Broker will have no further involvement in the process of evaluating
the property or negotiating any potential transaction.

3.      Seller agrees to pay Broker a referral fee of 6% in case a
transaction is completed with Buyer. 

 

The Seller has sold the property to a Buyer introduced by the Broker to the
Seller. Is the Broker entitled to collect his commission, or is he barred
from collecting it by RCW 18.85.331?  

That statute, set out in full below, provides that a prerequisite to a suit
for compensation as a real estate broker is that the plaintiff was a
licensed as such at the time of the "contract for the payment of
compensation for any contemplated real estate transaction."  Does anyone
know of any case law addressing a "referral agreement," however stylized,
which attempts to skirt the statutes regulating real estate brokers.

 

 

RCW 18.85.331. License required - Prerequisite to suit for commission 

It is unlawful for any person to act as a real estate broker, managing
broker, or real estate firm without first obtaining a license therefor, and
otherwise complying with the provisions of this chapter.

No suit or action shall be brought for the collection of compensation as a
real estate broker, real estate firm, managing broker, or designated broker,
without alleging and proving that the plaintiff was a duly licensed real
estate broker, managing broker, or real estate firm before the time of
offering to perform any real estate transaction or procuring any promise or
contract for the payment of compensation for any contemplated real estate
transaction.

 

Rod Harmon

 

RODNEY T. HARMON

       Attorney at Law

         P.O. Box 1066

      Bothell, WA   98041

     Tel:   (425) 402-7800

     Fax:  (425) 458-9096

    www.rodharmon.com <http://www.rodharmon.com> 

   rodharmon at msn.com <mailto:rodharmon at msn.com> 

 

 

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