Professional Report - Q4 2013 Winter

guessed, the seller then gave the property back to its lender in a deed in lieu of foreclosure, and the contract buyer quickly came to terms with the lender. Meanwhile, my client’s lien, based on the exclusive sale listing and the Owner/Buyer contract, remained of record. We claimed the fee was earned when that contract was procured and signed by both parties.

Instead of a battle where the lender would have had to actually foreclose to clear title and erase the lien (which could have taken several months), I received a call from the bank’s attorney, as preparer of the Notice of Lien. The bank’s attorney recognized me as attorney for the listing broker. The bank’s lawyer advised that the contract price had been slightly reduced, but the bank agreed to pay the broker’s commission at the same rate, on the new price, so long as we provided a recordable release of lien at closing. We happily complied with a letter to the closing agent:

“When you are prepared to pay the sum of $[commission] to [lien claimant] in accordance with the attached invoice, you may deposit the enclosed Release of Lien into escrow and record same after payment of the commission. Wiring instructions are enclosed.”

We lawyers learn from reported case law, brokers learn from their peers’ experiences. Teamwork often leads to better results. It bears mention that one of my clients on the deal described above is an SIOR.

Is there a lesson to be learned? Of course: know your rights, and if you have broker lien rights, understand what that means and how to use this powerful remedy to protect the fee that you have earned, before a deed in lieu of foreclosure or a foreclosure could eliminate your right to a fee.

As Coman & Anderson's Real Estate Partner, Jim Hochman represents many commercial real estate brokerage firms, receivers, landlords, tenants, and real estate investors by assisting in commercial and residential real estate transactions. Prior to joining Coman & Anderson, Jim was Senior VP & Senior Counsel for CBRE for 22 years, representing CBRE in all aspects of real estate services. Jim can be reached at jahochman@arnstein.com.