Question

business law

Edison was the owner of a large vacant lot in Kansas City. She hired Simpson, who had extensive experience in both real property management and sales, to sell the lot for $420,000 in return for a commission of 5%. After a great of effort, Simpson entered into negotiation with Dennison, a land developer, who was willing to pay up to $500,000 for the lot. During the negotiation, Dennison promised to pay Simpson $25,000 if he could make the purchase for $420,000. Simpson was able to sell the lot for that price. Does Simpson have the right to the 5% commission payment and the $25,000 payment from Dennison?

Answer 1

No, Simpson does not have the right to the commission and the payment. He had entered into a contract with Edison, with the offer to sell the land in return for a consideration of 5% commission payment. This was accepted by Simpson. In addition both parties had the capacity and competency to enter into a contract. As all the elements of the contract were valid, an enforceable contract was established. Hence, as per the original contract, Simpson has the right to the commission payment.