Shabbat Parashat Toldot 5783

P'ninat Mishpat: Did the Realtor Help? – part I

Case: A real-estate agent (=pl) publicized in a WhatsApp group an apartment for rent, with a video of the interior and basic details (with name of street but not building #). The defendants (=def) set up an appointment to see the apartment. While waiting for pl to finish with a previous client, def figured out that the apartment was owned by friends and that they had considered renting it months ago, but it had been too expensive (7,500 NIS a month). Def promptly called the owner, who said that it was not on the market but looked into it and found out that the present renter wanted to leave early and had asked pl to put it on the market. Def then told pl they knew the apartment and refused to sign the agent agreement and ended up renting it directly from the owners for 7,000 NIS. Pl demands a full realtor’s fee because he gave def the information through which they were able to rent it. Def argue that they are exempt because they did not sign the contract and because the owners had promised to tell them if the price went down, which they would have done when they found out the renter was looking for a replacement.

Ruling: Israeli law regarding real estate agents determines that they are entitled to their fee only if three conditions are all met: 1. They are licensed agents. 2. They signed the client to a detailed contract. 3. They were the "effective factor" in bringing the sides to an agreement. In several piskei din of our network, we have determined that we generally view this law as the valid “law of the land” for these purposes. This is to a great extent because the law is designed to prevent quarrels over when the agent deserves payment (see Shut Harashba II, 356).

We should therefore determine whether pl was the effective factor for def’s renting of the apartment. On the one hand, def claimed that they had a promise in hand from the owners to let them know if the apartment was on the market in a manner that was feasible for them. On the other hand, def could not assure us that this definitely would have happened. Pl is correct that the fact that the owners had already lowered the price from 7,500 to 7,000 NIS (for the present renter) without telling pl raises questions if they would have let def know this time, and especially if the renter would have presented them with someone ready to rent at their price.

However, we believe that there is still doubt on the matter. If the renter had not found a new renter promptly, the renter might have told the owners who then likely would have approached def. We note that while in the beginning, pl rejected def’s entire story as a fabrication to get out of paying, evidence presented during the hearing caused him to accept def’s story. We note also that def suggested calling the owners while in beit din to hear their perspective and pl refused (as was his right) to do so. Therefore, the question of credit for facilitating the rental remains unsolved.

We continue with other elements next time.

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