Court Orders Seller to Pay Real Estate Agent Over $30,000 Commission
A Tel Aviv Magistrate's Court has ruled in favor of a real estate agent who sued a client for unpaid commission after selling his Raanana home for over 4 million shekels (approximately $1.1 million USD). Judge Edna Yosef-Kozin determined that the agent was the "effective cause" of the sale and therefore entitled to his full fee plus damages for distress, totaling around 125,000 shekels (approximately $34,000 USD).
The parties signed an exclusive brokerage agreement in January 2020, stipulating a 2% commission plus VAT. Although the exclusivity period expired, the agent continued to assist in the sale, and the agreement remained in effect. In late 2020, the agent introduced a potential buyer, and after initial negotiations stalled, discussions resumed.
Court documents revealed the agent's intensive involvement, including offering solutions to disputes, facilitating draft exchanges, and attending the final signing in June 2021. The agent claimed he brought the buyer and guided negotiations to the sale's conclusion. He initially sought approximately 172,000 shekels for commission and damages.
The seller argued that the agent was not the effective cause, as the decisive negotiations occurred directly between him and the buyer. He also claimed the agent had agreed to accept payment solely from the buyer, citing an exchange where the agent responded affirmatively to being "satisfied" with a deal with the buyer, viewing it as "acceptable compensation for all your work."
However, Judge Yosef-Kozin rejected the seller's defense, finding that text messages indicated the seller knew he owed the 2% commission plus VAT, even writing, "There is no way we are not paying you." The court found the seller had "calculatedly and deliberately" attempted to trick the agent into waiving his fee by using ambiguous questions. The judge concluded the agent did not understand he was being asked to forgo his payment. The court awarded the agent 96,760 shekels in commission, plus 11,255 shekels for distress and other costs, noting the agent "found himself forced to conduct a long struggle to realize his just rights." The seller was also ordered to pay 17,500 shekels in legal fees and court costs.
