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GK Realty Services, LLC v. Stopar

2008 WL 657126 (N.J. Super. App. Div. 2008) (Unpublished)

BROKERS; UETA — The Uniform Electronic Transactions Act, as applied to real estate brokers, strictly provides that an oral agreement to use a broker’s services and the payment of a commission must be confirmed by a memorandum or other written communication, personally delivered or by certified mail, but not by email transmission.

In a case involving the Uniform Electronic Transactions Act, a broker (Broker A) tried to bring a prospective buyer and seller together in connection with the sale of commercial property. Broker A contended that, during the negotiations, the seller orally agreed to pay a commission to Broker A. Broker A then followed up this alleged oral commission agreement with a series of confirming emails to the seller. However, negotiations were unsuccessful as the buyer and seller could not agree on a purchase price. In the course of negotiations, the seller signed an exclusive listing agreement with another real estate agency (Broker B). Six months later, the buyer drove by the property and noticed that the property was still for sale. He spoke to the seller personally. The buyer did not call Broker A and had not heard from him in a while. The seller testified that he neither contacted Broker A nor did he ask the buyer to further contact Broker A because he had given an exclusive listing to Broker B. The seller then signed a new exclusive listing with Broker B. The property was sold to the buyer, and Broker A sued, alleging that he was the procuring broker on the sale of the property. The case was tried before a jury which ruled against Broker A, who appealed.

In the appeal, the Appellate Division held that the Statute of Frauds precluded a finding that a binding contract existed between seller and Broker A. The Court concluded that the Uniform Electronic Transaction Act, as applied to real estate brokers, strictly provides that an oral agreement to use a broker’s services and the payment of a commission must be confirmed by a memorandum or other written communication containing the basic elements of the agreement, personally delivered or by certified mail and not by email transmission.


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