Real Estate Commission, Quantum Meruit

Real estate commissions (usually 4%-7% of the sale price) are typically paid in accordance with express contract terms. Therefore, if a party fails to pay a real estate commission, the realtor usually has a cause of action for breach of contract. For practical reasons, this usually does not happen because most real estate transactions are run through a title company and the escrow agent disperses funds directlor to the realtor.

In rare instances, a realtor does not have a contract. There may also be a problem with the contract, rendering it defective or inapplicable. The realtor may, nevertheless, have a claim for quantum meruit to recover a real estate commission if the realtor can establish that (1) brokerage services were provided, (2) accepted by the party, and (3) the realtor was the “procuring cause” of the sale. Incentive Realty, Inc. v. Hawatmeh, 983 S.W.2d 156, 162-63 (Mo. Ct. App. 1998).

The realtor is the “procuring cause” if his or her initial efforts in calling the prospective purchaser’s attention to the property must have set in motion a series of events which, without break in continuity and without interruption in negotiations, eventually culminates in the sale. Williams v. Enochs, 742 S.W.2d 165, 167 (Mo. 1987).