A relator sought a brokerage fee of 2% from a transaction to sell a lot in Kfar Shmariahu, even though the property was purchased with the assistance of another relator.
The Court held that the relator is not entitled to the full brokerage fee, because she was not the effective factor in executing the transaction. A realtor is entitled to brokerage fees if three cumulative conditions are met: a. Valid relator license; B. The existence of a written document that includes the transaction details; and also C. The relator was "the effective factor that resulted in the parties entering into a binding agreement." Here, a written brokerage agreement was signed that includes an undertake to pay a brokerage fee of 2% even if the relator will not be involved in the transaction. However, the relator knew from an early stage that the transaction would be completed through another relator (who was paid a commission of 1%), and remained silent. In addition, the relator did not make the contact between the property owner and the purchasers and did not handle the negotiations in the transaction. Therefore, the relator was not the effective factor in the transaction and therefore, does not entitled to the full agreed commission but to a proper compensation of ILS 75,000 only.