Legal Question in Real Estate Law in California
Assume that you find a builder on your own and ask your broker to set up a meeting between the two of you. If down the line you decide to switch brokers is the original broker entitled to a finder's fee if you eventually by from the builder?
1 Answer from Attorneys
Probably not. A broker's right to a commission or fee is based on contract and agency law principles. Civil Code section 1624(a)(4) requires contracts to pay a commission for broker or finder services to be in writing if the deal involves real estate.
An exception would arise if there is some "note or memorandum" of an agreement to pay a fee or commission, signed by you.
If there was no agreement, written or oral, the broker might allege that there was an implied promise to pay, that he provided valuable services, and your failure to pay results in so-called unjust enrichment. However, California appellate decisions have consistently denied relief to brokers on unjust enrichment, quantum meruit, implied contract or equivalent theories.
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