In F. Richard Wolff & Son, Inc. v. Tutora , F. Richard Wolff & Son (Wolff) sued Anthony Tutora for a commission Tutora allegedly owed to the company.
Tutora hired Wolff as a real-estate broker to sell Tutora's "adult care resident facility" business and accompanying real estate, "as a package." The terms of their contract provided that Wolff's commission would be 6.5% of the selling price.
After Wolff found a prospective buyer, Tutora agreed to a $1.3 million deal, but the sale was subject to the purchaser getting a substantial bank loan. When that fell through, the parties continued their negotiations and the purchaser bought the business and leased the real property from Tutora, months after the brokerage agreement expired.
Wolff felt that it was still owed a commission based on the $1.3 million price because the company had procured a "ready and willing" buyer. The Westchester County Supreme Court felt otherwise and dismissed the case.
On appeal, the Appellate Division, Second Department, reiterated the established rule that "a real estate broker will be deemed to have earned his or her commission when he or she produces a purchaser who is not only ready and willing to purchase ... but able to do so as well." As the sale of the business and real estate was contingent upon bank financing, and the purchaser was unable to close the deal originally contemplated without those proceeds, Wolff wasn't entitled to a commission.
The AD2 wasn't afraid of no Wolff.
For a copy of the Appellate Division's decision, please use this link: F. Richard Wolff & Son, Inc. v. Tutora