Tadpole Inc wanted to sell a warehouse that it owned. It therefore entered into a contract with
Question:
Tadpole Inc wanted to sell a warehouse that it owned. It therefore entered into a contract with Bentley Properties Inc, a real estate agent. That contract contained a number of important terms. First, it gave Bentley the exclusive right to list and advertise the warehouse for 90 days. Second, it stated that Bentley would be entitled to receive a sales commission of 10 percent on "any successful sales contract created within the exclusive listing period." Eighty days into the listing period, Bentley showed the property to Janhelene Inc. Janhelene was seriously interested in the warehouse, but since it thought that it could get a better price by dealing directly with the owner, it sent an offer to Tadpole rather than to Bentley. After further communications, Tadpole and Janhelene signed a document, according to which Janhelene agreed to buy the warehouse "subject to the availability of suitable financing." That document was created on the eighty-eighth day of the listing period. A week later, Janhelene informed Tadpole that it had arranged financing, and the sale was completed two days later. When Bentley eventually discovered the details of the sale, it demanded the payment of a commission from Tadpole. Is Tadpole obligated to pay? What should Bentley have done to better protect itself in its contract with Tadpole?
Step by Step Answer:
Managing the Law The Legal Aspects of Doing Business
ISBN: 978-0133847154
5th edition
Authors: Mitchell McInnes, Ian R. Kerr, J. Anthony VanDuzer