In Rhode Island, Broker Adams has a listing agreement with a seller. A cooperating buyer's broker, Broker Bell, procures a buyer who submits a full-price offer. The seller accepts the offer, but before closing, the seller defaults and refuses to sell. Broker Adams has collected no commission. Under Rhode Island law, what is Broker Bell's most appropriate legal recourse for his commission?
Correct Answer
C) Broker Bell's claim for commission is solely against Broker Adams, based on the cooperative compensation agreement in the MLS
In a cooperative transaction, Broker Bell's compensation agreement is with Broker Adams (the listing broker), typically through the MLS cooperative compensation offer, not directly with the seller. Broker Bell has no direct contractual relationship with the seller. Therefore, Broker Bell's legal claim for commission runs against Broker Adams based on the cooperative compensation agreement. Broker Adams, in turn, may pursue the seller for the full commission under the listing agreement.
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