434 S.W.3d 667
Tex. App.2014Background
- In Sept. 2010 Lawrence signed a 3‑month exclusive listing agreement naming “The Reyna Realty Group” and promising a 5% commission (2% to Reyna Realty, 3% to buyer’s broker); the contract had an integration clause requiring written modification.
- Mel Reyna (named on the listing) was not a licensed broker; James Hopkins was the licensed sponsoring broker and had registered “The Reyna Realty Group” as an assumed name in Harris County but did not notify the Texas Real Estate Commission until after the sale.
- Hopkins and Reyna continued marketing the property after the Dec. 31, 2010 expiration (MLS listing, signs, open houses, lockbox); Lawrence did not object and communicated with them in Feb. 2011.
- On Feb. 27, 2011 the Earnest Money Contract for the sale listed Reyna Realty as Lawrence’s broker; Reyna coordinated inspections and appraisals and negotiated the sale price.
- At the Mar. 28, 2011 closing Lawrence listed Reyna Realty as her broker on the settlement statement but attempted to unilaterally reduce the commission; Reyna refused, and Lawrence later repudiated paying any commission.
- Reyna sued for commission; the jury found ratification, waiver, breach, and awarded $14,400 damages and $36,000 attorney’s fees; the court of appeals affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to sue for commission | Reyna Realty lacked a broker license at the time and so cannot recover under the Real Estate License Act | Hopkins (licensed broker) was identifiable as the broker because he registered "The Reyna Realty Group" as his assumed name; thus Reyna Realty could recover | Reyna Realty had standing; the listing identified Hopkins via his assumed name, so recovery was permitted ([Occupations Code §1101.806(b)(1)] applied) |
| Statute of Frauds (oral extension) | The written listing expired Dec. 31, 2010; any post‑expiration oral extension is unenforceable | Lawrence acknowledged the post‑expiration continuation in writing (Earnest Money Contract and Settlement Statement) | The statute of frauds did not bar recovery because Lawrence’s written post‑termination acknowledgments evidenced continuation/ratification |
| Submission of ratification/waiver to jury | Trial court erred because ratification/waiver defenses were not properly pleaded or tried | Reyna’s petition attached the Earnest Money Contract and provided fair notice; ratification was tried by evidence and prior notice | No abuse of discretion: jury could consider ratification; Reyna gave fair notice and evidence supported submitting the issue |
| Sufficiency re: waiver and closing agreement to pay commission | Lawrence argued no evidence supported waiver or that the settlement statement fixed a commission | Reyna argued conduct and written instruments showed waiver/ratification and agreement at closing | Court did not reach sufficiency of waiver claim because ratification independently upheld recovery; ratification was supported by Lawrence’s written acknowledgments |
Key Cases Cited
- Henry S. Miller Co. v. Treo Enters., 585 S.W.2d 674 (Tex. 1979) (unlicensed entity cannot recover commission when contract lists the entity rather than the licensed broker)
- Boyert v. Tauber, 834 S.W.2d 60 (Tex. 1992) (identity of broker is an essential contract element; parol evidence limits)
- Northborough Corp. Ltd. P’ship v. Cushman & Wakefield of Tex., Inc., 162 S.W.3d 816 (Tex. App.—Houston [14th Dist.] 2005) (not every licensing violation bars recovery; statute text controls)
- Italian Cowboy Partners, Ltd. v. Prudential Ins. Co. of Am., 341 S.W.3d 323 (Tex. 2011) (integration clauses can negate authority to vary written terms orally)
- Dracopoulas v. Rachal, 411 S.W.2d 719 (Tex. 1967) (oral extension before expiration may be enforceable; post‑expiration oral modifications are unenforceable)
- Meritage Homes of Tex., LLC v. SP Terrace, L.P., 334 S.W.3d 275 (Tex. App.—Houston [1st Dist.] 2010) (statute of frauds bars oral modifications after written contract falls within it)
- RE/MAX of Tex., Inc. v. Katar Corp., 961 S.W.2d 324 (Tex. App.—Houston [1st Dist.] 1997) (unpleaded affirmative defenses are waived unless tried by consent)