Q&A: Monetary Law
Monetary Law
Question
Hello Michi,
In April 2021, the client summoned me to a meeting and expressed his desire to sell the property.
His idea was to turn it into a boutique hotel or small apartments for short-term rental.
At that stage, no fee arrangement was finalized.
I began a process with a professional architect, who recommended not going in those directions but rather turning the building into 3 huge apartments.
The client accepted the recommendation.
After that, the client was in the middle of renewing a lease with the tenant in the building and asked to put the project on hold.
On October 25, 2021, he summoned me again to a meeting in order to move the sale forward.
We met and agreed on my fee.
Below is what I wrote to him, and I received his approval for it on November 10, 2021.
Before presenting the correspondence between me and the client, the events were as follows:
“Hello Pierre,
Regarding 19 Yavne:
Following our meeting today, we agreed as follows:
1/ We are preparing a brochure for the project with the architect, which will include 2 options:
A) One apartment per floor
B) A private residence
You will tell me if you want to be present at the first closing meeting with the architect
2/ Once the brochure is ready, we will put the property on the market at 70 million NIS as is.
3/ I will handle everything; in return, I will receive 2% of the sale price up to 70 million NIS, and 5% of any amount above that, if there is any.
4/ Good luck
Please confirm” (he confirmed).
Following the above summary, I decided to replace the architect (the first one also was not willing to work on the project without completing it, and he also asked for an 85,000 NIS fee.
I found someone no less professional—perhaps more so—for only 50,000 NIS, and she was also willing to work under these conditions.
On 11/18/21, a work agreement was signed with her, and she was paid an advance.
She started working and managed to prepare an initial proposal (which I sent to the client).
On November 28 (after about two weeks), I asked him in a voice message what would happen if he found the buyer, and he answered me like this:
“If I bring the buyer, your commission will be reduced to 1.5%, but you are responsible for seeing it through until closing.”
In practice, when he found the buyer, he asked me to do a quick check of the property’s market value so he could be sure he wasn’t making a big mistake by selling at 65. I did that and got back to him within 48 hours with a warm recommendation to sell (I was, of course, far from thinking that he would refuse to pay me… and of course he did not mention that, in his view, our agreement was void…).
He did not need me at all regarding the contract, since the buyer speaks French and the client has a regular lawyer, and everything went smoothly.
At the beginning of January, a sale agreement was signed without any assistance at all from the architect’s work (although I believe he did present the buyer with the idea of the 3 apartments together with some sort of business plan showing the sale prices of the three apartments and the potential profit from the deal, but never mind).
What is the law regarding my commission on the sale?
Answer
I can’t manage to follow all this. I suggest you go ask a halakhic decisor in person.