Legal Updates

In the absence of a written document for ordering real estate brokerage services a realtor may lose its right to brokerage fees

October 8, 2023
Print

A relator demanded payment of brokerage fees though no written brokerage agreement was signed.

The Court held that in the absence of a written brokerage agreement, no brokerage fee will be paid in the transaction. Under Israeli law, the recipient of brokerage services commitment to pay brokerage fees must be reflected in a written and signed agreement. The role of the realtor, being a professional, is to make sure the statue of frauds requirement is duly met and as long as it fails to do so its right to a proper consideration for its labor will be denied. Trust relationship does not prevail over the writing requirement. Here, the relator voluntarily presented the property before a written order or agreement for brokerage services with the consideration details was signed. The realtor made a mistake by relying on "relationships of trust" and did not condition the buyers' prior invitation to tour the property to the payment of a brokerage fee, nor did she contact the buyers shortly after the tour of the property to sign a written brokerage agreement. This is not a case where the client unwittingly discovers the details of the property by perusing the broker's personal documents without permission or by cheating and in the absence of a written brokerage agreement, the realtor is not entitled to receive brokerage fees.