48 Pa. D. & C.5th 295
Pennsylvania Court of Common P...2015Background
- Binswanger is a licensed Philadelphia property broker that entered into an Exclusive Right to Sell or Lease Agreement with TSG for 1400 Welsh Road, North Wales, PA.
- The agreement carved out exclusions for Aneblare, Inc., TWA Holdings, LLC, Jerry McBride, and any entities associated with them, including a carve-out until January 5, 2014 during which commissions were not due.
- On January 3, 2014, TSG and TWA executed an Agreement of Sale for the Welsh Road property, with a mortgage contingency and a 60-day due-diligence window.
- Binswanger sought a commission arguing the sale occurred after the carve-out period; TSG contended the Agreement of Sale completed the sale prior to carve-out expiration, releasing commission liability.
- TSG terminated the exclusive broker agreement (effective March 26, 2014) after attempts to terminate in January and February were ineffective.
- The property ultimately sold to TWA on February 24, 2014 (sale completed April 24, 2014 per the record), and Binswanger filed suit seeking a commission; the court awarded partial relief consistent with the exclusive agreement terms.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did execution of the Agreement of Sale constitute a completed sale? | Binswanger argues sale was not complete due to mortgage contingency. | TSG argues equitable title passed at signing, making sale complete before carve-out end. | Execution was not a complete sale; mortgage contingency prevented completion within carve-out. |
| Was TSG's termination of the Agreement of Sale effective? | Binswanger contends termination ineffective to bar commission. | TSG argues termination before due date nullified commission liability. | Termination attempts were ineffective; commission owed to Binswanger. |
| Is Binswanger entitled to full commission or a partial amount? | Binswanger seeks full commission per exclusive listing agreement. | TSG argues commission should be reduced or not due if carved-out provisions apply. | Binds to one-third of the commission due to three brokers involved. |
Key Cases Cited
- Coldwell Banker Phyllis Rubin Real Estate v. Romano, 422 Pa. Super. 319 (Pa. Super. 1993) (supports broker lien/commission principles)
- Payne v. Clark, 409 Pa. 557 (Pa. 1963) (contract/real estate commission principles)
- Dubin Paper Co. v. Insurance Co. of North America, 361 Pa. 68 (Pa. 1949) (classic contract interpretation in commissions)
- Bauer v. Hill, 267 Pa. 559 (Pa. 1920) (equitable conversion and title concepts in real estate)
- In re Governor Mifflin Joint School Authority, 401 Pa. 387 (Pa. 1960) (equitable conversion not triggered by conditional contract)