8011, Llc, Walter Moss & Kari Graves v. Mr.99 & Associates & Martin S. Rood
73737-6
| Wash. Ct. App. | Dec 27, 2016Background
- 8011 LLC (seller) contracted with broker Martin Rood for an exclusive brokerage listing from July 21, 2011 to January 21, 2012, providing a 5% commission on sales during the term or under certain post-expiration ("tail") conditions for six months after expiration.
- Before and during Rood’s listing, Rood had earlier contact with buyer Mazda as a buyer-side agent; Mazda initially could not purchase due to a statutory radius restriction but later obtained a waiver.
- Rood did not procure a buyer during the listing term, and did not deliver an offer or a registration list required by the tail provision before or shortly after expiration; the listing expired unsold.
- Months later Mazda and 8011 negotiated and ultimately executed a written Purchase & Sale Agreement (PSA) that omitted and expressly deleted any seller commission; the final PSA included a handwritten statement that the seller would pay no real estate commissions.
- Rood sued for the unpaid commission (contract and tort theories); trial court awarded Rood commission and attorney fees; 8011 appealed. The Court of Appeals reversed, deciding the case as a matter of law on the summary-judgment standard.
Issues
| Issue | Rood's Argument | 8011's Argument | Held |
|---|---|---|---|
| Entitlement under the written brokerage agreement | Rood contends he is entitled to 5% commission because he was the selling firm and sections referencing sales do not expire | 8011 argues Rood failed to meet the durational and tail conditions (no buyer procured during term; no timely offer or registration) | Court: Rood failed to satisfy the agreement terms; no commission under the contract |
| Applicability of the procuring-cause rule | Rood argues he was the procuring cause of the eventual sale and thus entitled to commission despite written tail | 8011 argues the parties negotiated a specific tail provision that governs post-expiration commissions, displacing procuring-cause gap-filling | Court: Procuring-cause doctrine inapplicable because the written contract’s tail provision controls |
| Third-party beneficiary status under the final PSA | Rood relies on prior offers/counteroffers that provided for commission and notes he is identified as selling firm in PSA | 8011 points to the final PSA’s crossed-out commission clause and the handwritten "seller will pay no real estate commissions" language | Court: Final PSA shows no intent to confer a commission to Rood; he is not a third-party beneficiary |
| Statute of Frauds / written agreement sufficiency | Rood points to written offers/counteroffers exchanged between Mazda and 8011 as satisfying statute of frauds | 8011 notes those writings were not accepted and thus do not create a binding promise to pay commission to Rood | Court: Unaccepted/withdrawn offers cannot satisfy the statute of frauds; no enforceable brokerage agreement for the sale |
| Unjust enrichment and tort claims (conversion, misappropriation, interference) | Rood claims equitable/tort relief because he was deprived of the commission he earned | 8011 argues Rood had no property interest or vested right to a commission under the contract or the PSA | Court: Rood lacked a property interest/benefit retained by 8011; equitable and tort claims fail |
Key Cases Cited
- Tanner Elec. Co. v. Puget Sound Power & Light Co., 128 Wn.2d 656 (1996) (contract interpretation centers on parties' intent and reading the contract as a whole)
- Willis v. Chamolain Cable Corp., 109 Wn.2d 747 (1988) (procuring-cause rule and its application; procuring cause is displaced by express contractual commission provisions)
- Svputa v. Druck, Inc., 90 Wn. App. 638 (1998) (written contract terms specifying post-termination commission procedures limit application of procuring-cause doctrine)
- Lewis v. Boehm, 89 Wn. App. 103 (1997) (third-party beneficiary requires intent that promisor assume direct obligation to third party)
- Fleetham v. Schneekloth, 52 Wn.2d 176 (1958) (parol evidence is inadmissible to vary clear written contract terms)
