can a buyer be liable to pay commission to agent if he backs out of a transaction after signing docs at escrow

I have been working with this Buyer for 3 months, hours of committment only to see him walk, loosing Earnest Money of $5,000. Do I as a Selling agent have any grounds to pursue my commission from the Buyer after defaulting?
In Selling Property - Asked by Scott G. - Nov 22, 2010
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Wilbur B.
Lake City, SC

In most states the seller has a right to sue for Specific Performance or Damages. You should have your attorney look at the Contract of Sale, your Listing Agreement, and other documents connected to this matter. Question? Why did the buyer walk? What does the seller want to do about the walk? You may want your seller to meet with you and your attorney to see if the two of you have a right to sue for Specific Performance--that is complete the transaction.

Nov 22, 2010
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Rob B.
Chandler, AZ

This is a legal question that you should ask legally within your state. You might call the title company you use and ask them to answer this for you. They may refer a question like this to their company lawyer as one of their services to you.
However, my general answer would be, what does the written agreement you have with the Buyer say with regard to this issue?
Good luck....
Rob Baird, CA RE License #544165 (One of the oldest, active licenses in CA) 951 515-5855 Email:

Nov 22, 2010
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Jamiel C.
Richmond, VA

This depends. The purpose of escrow is ''I don't know", that is to say, you are letting a third party hold the funds until you are certain you want the deal. So the typical contract does allow you a back door if you do not want to move forward. That exit means you won't pay closing fees, of which brokerage commissions are included. Various components could alter this outcome. The actual clauses in the escrow agreement, and legal obligations the broker my have obliged you to in advance, state laws and brand consideration, given that you don't want to be known as someone that never closes a deal. Taken together, you should be able to opt out, but as I said earlier,- it depends.

Nov 22, 2010
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Alan S.
Huntersville, NC

You need to consult an attorney and ask yourself how much money are you willing to spend on legal fees.

Nov 22, 2010
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Robert S.
Property/Asset Manager
Walnut Creek, CA

Scott you are on shaky ground! Remember, your "contractural right" to a commission is with the listing broker and through the Seller, not the buyer. Usually, in many states, it specifies (a) listing agent is entitled to a commission IF the seller cancels the listing, (b) upon the completion of escrow evidenced by a change in ownership, or (c) maximum of one-half of any forfeited buyer deposits into or through escrow, or the amount of your commission, if it is less than one-half of the forfeited amount. Your specific question is whether you have any legal grounds to pursue the "Buyer" for damages to you as a result of his defaulting on the escrow? I think the answer is clear...If the listing agreement with the Seller allows the listing broker to participate in the forfeited earnest money deposit, you would be entitled to share in it as the selling agent. However, you do not have legal standing to go after the buyer, unless you have something in writing, from the Buyer (with knowledge and approval of the Seller), granting you a commission, fee, or a right to all or a part of the defaulted earnest money deposit. Lick your wounds and move on...That's just a part of the business!

Nov 23, 2010
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Beth W.
Claremont, CA

Do you have a buyer - broker agreement or similar document specifying damages in the event of a breach of contract?
Beth Walsh, Tarbell, Realtors DRE # 01276309

Nov 30, 2010
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