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Implied Deal Good As Written
by Ron Davis
A cozy long-term relationship with a Connecticut shopping center has provided a real-estate agent with a disputed final payoff for management services he rendered.
The shopping center is Middletown Plaza in Middletown, and the agent has managed the property since the 1980s. During that time, he retained 30 percent of the fees paid to the real-estate firm that served as the center’s property manager.
The agent persuaded the real-estate firm to pay those fees because of his close relationship with the center’s owners. He claimed, for example, that he had produced the center as a client for the firm, that he controlled the center, and that he would have the center’s owners hire another management company if it did not pay him 30 percent of the fees earned.
That relationship was simply understood, however. Nothing was ever put in writing. Yet, the real-estate firm paid the 30-percent commission to the agent each month for 15 years.
In 2005, however, the shopping center’s owners notified the real-estate firm that they were turning over management responsibilities to the real-estate agent. The real-estate firm continued to earn its management fee for two months following that notification, but refused to pay the 30-percent commission to the agent for those months. He sued, claiming that his agreement with the real-estate firm called for payment of the commission.
The real-estate firm replied that the agent’s claim was based upon an oral contract that was not enforceable.
In ruling in favor of the real-estate agent, a Connecticut court stated that his services were “fully performed” and that he had proven a breach of contract consisting of 30 percent of the management fees earned by the real-estate agency on its management contract for the two months in question.
Furthermore, the court added, “This arrangement had been in effect between the agent and the real-estate firm prior to the incorporation of the real-estate firm and has continued until the shopping center terminated the management contract in 2005.... While the real-estate firm may not have liked the arrangement, it was carried out for approximately 15 years.” (Block v. Bradford, 2007 WL 196479 [Conn.Super.])
Decision: February 2007
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