SALESPERSON'S COMMISSION ACTION LEADS TO INVESTIGATION INTO BROKER'S BUSINESS PRACTICES
Real estate salesperson initiated this lawsuit seeking payment for commissions she alleged were earned in the course of her duties are working in the office of the defendant real estate broker. The broker denies that the claimant is entitled to any money.
Plaintiff is a former employee of the defendant broker named Mrs. Cash, Inc. The broker hired the claimant to work as a salesperson to try and sell pieces of property which were difficult to sell. When the plaintiff found a buyer for a piece of property which the defendant owned, she was not paid her share of the full commission since the buyer failed to pay all the money due at closing. As a result, the seller decreased the claimant's commission by the amount it lost.
At the time of trial, the position of the defendant's witness was that the claimant should sue the buyer for the balance of the money he owed the defendant and then the claimant would receive the balance of her fee. Claimant countered that her agreement was with the broker and it was the broker owner who owed the claimant her commissions, not the buyer.
During the course of the trial, it was discovered that the claimant was not a licensed real estate salesperson. In fact, none of the people who were hired by the broker were licensed salespersons under Article 12(a) of the Real Property Law which provides in part that "No person, co-partnership, limited liability company or corporation shall bring or maintain an action in any court of this state for the recovery of compensation for services rendered in the buying, selling upon any real estate without alleging and proving that such person was a duly licensed real estate broker or real estate salesperson on the date when the alleged cause of action arose."
The plaintiff acknowledged that she was not a licensed real estate salesperson on the date of the sale and as a result, the court denied her the commission she rightfully earned. On the other hand, understanding that the defendant broker continued to profit from hiring unlicensed salespeople who performed services which provided financial benefit to the broker, left the workers with no means of obtaining their just due. As a result, the court forwarded a copy of the decision to the Secretary of State and the Attorney General of the State of New York to commence an investigation into the business practices of the defendant broker. If it is determined that the broker knowingly hired unlicensed salespeople and then failed to pay for the services rendered, the authorities are to investigate as to whether the broker should be entitled to keep its real estate license in the State of New York. Both the Secretary of State and the Office of the Attorney General were directed to inform the court as to the result of its investigation.
Sasson v. Mrs. Cash, Inc., Civil Court, Kings County
Capuder Fazio Giacoia LLP
90 Broad Street
New York, New York 10004-2627
Telephone: 212-509-9595
Fax: 212-509-9597
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