"Exclusive Agency" Agreement

1) Exlcusive right to sell agreement

2) Exclusive agency agreement

3) Open listing agreement

4) Net listing agreement

A broker is entitled to a commission when he produces a buyer ready, willing and able to purchase the property on the seller's terms, even if the sale is not completed. See Drake v. Hosley. If buyer defaults, commission is still owed to broker. However, if there is a condition in the contract that is not met, such as the buyer cannot get financing, the buyer does not owe the commission.

This is a default rule.

1. Incidental Test. A nonlawyer may perform some legal tasks if they are minor and only incidental to the main service being offered.

2. Simple-Complex Test. Nonlawyers may perform simple legal tasks; only lawyers may perform complex ones.

3. Personal Representation Test. When a nonlawyer may not give legal advice to others, he may perform legal services for himself.

1. He produces a purchaser ready, willing and able to buy on the terms fixed by the owner;

2. The purchaser enters into a binding contract with the owner to do so; and

3. The purchaser completes the transaction by closing title in accordance with the provision of the contract.

No closing, no commission.

This rule is followed by some courts although most recent decisions follow the traditional rule of awarding a commission on the procurement of a ready, willing and able buyer if the deal does not close.

Ambiguous brokerage agreements are...

1. Open listing will be found unless exclusivity is clearly indicated. Similarly, an exclusive agency will be found rather than an exclusive right to sell.

2. Broker must establish that she was the primary, proximate and procuring cause, not merely the one who "planted the seed from which the harvest was reaped"

1. Brokers should provide a statement stating who they represent and who they don't represent. Typically, brokers represent sellers.

2. Brokers should not split fees with non-Texas licensed brokers.

3. Brokers have fiduciary duties to their clients (disclosure, loyalty, due diligence, etc).

Rule: Brokers not liable unless they knew or should have known that representations were false. Sellers are liable.

"Owners are liable for such misrepresentations because they are presumed to know the character and attributes of the land which they convey," but "real estate brokers and agents are marketing agents, not structural engineers or contractors. They have no duty to verify independently representations made by a seller unless they are aware of facts that tend to indicate that such representations are false." - Buyer can always get a title survey and title insurance.

From the time of the contract of sale of real estate, the burden of fortuitous loss is on the purchaser even though the vendor retains possession.

Growing trend: Fortuitous loss will be on the party in possession.

Other jurisdictions will wait until the moment of the transfer of title.

Illusory Contract. Unenforceable. This puts all the discretion in the hands of one of the parties.

Indefinite Contract. Terms are indefinite. Usually unenforceable, but in some cases, the court may be able to fill in the terms.

Specific Performance

Damages (dif. mv and kx price with incidentals and losses)

Rescind and recover deposit

Vendee's lien

Specific Performance

Damages (dif. bt kx price and mv at date of breach)

Rescind and retain any deposits

Vendor's Lien

Purchaser of real estate is not required to tender payment prior to suing for specific performance where such a tender would be futile.

No legal right to specific performance. Specific performance is an extraordinary remedy that can provide relief when legal remedies are inadequate. SP should not be granted if unjust, oppressive, or unconscionable. Court should balance equities. In this case, the property was unique, and plaintiff had invested hopes and dreams into it (as well as money).

The notary signed the deed without one of the parties being present. The notary was held liable for damages two deeds down the road. Four elements:

1) Establish duty; 2) Violation of that duty;

3) Proximate cause; and 4) Damages.

Causation element does not require that notary be sole cause. Liability rooted in recording statutes.

Inhabitability

Sound workmanship

Proper construction

Three present covenants:

1. Seisin;

2. Covenant of the Right to Convey; and

3. Covenant Against Encumbrances.

Three future covenants:

1. Covenant of Warranty;

2. Covenant of Quiet Enjoyment; and

3. Covenant for Further Assurances.

1. Quit-Claim Deed. Without any warranties. Whatever I own, I'm transferring to you.

2. General Warranty Deed. Contains the six implied covenants and warranties.

3. Special Warranty Deed. The covenants apply. The title I'm transferring is what it is, and I did not do anything to affect the title while I owned the property. If something happened in the chain of title, sue someone else.

First in time, first in right.

This is a default rule.

1. Actual

2. Inquiry Notice or Implied Actual Notice

3. Constructive Notice or Record Notice

Once BFP establishes a good chain of title, the chain of title is valid, and notice of the defect doesn't affect subsequent purchasers.

Example: A -> B. B doesn't record. A -> C. C is a BFP without notice. C -> D. Even if D has actual notice of B's interest, under the shelter principle, the chain of title is still valid because C was a BFP.

Majority rule: If your filing is correct but improperly indexed, then it still gives notice.

Minoity rule: The burden is on you to make sure the clerk properly indexes the doc.

1. Attorney's Fees

2. Lienholder who is foreclosing

3. Remaining downstream lienholders by priority

4. Borrower

The money doesn't go to the senior lienholders because their interest is unaffected. The amount of this lien is facotred into the purchase price.

1. Judicial

2. Non-Judicial

3. Strict

1. To redeem the property from the senior mortgagee; and

2. The right to participate in a public foreclosure sale; and

3. Receive any surplus proceeds after the senior mortgage has been satisfied.

A fraudulent sale is void.

Failing to comply with statutory requirements is voidable.