SL 4000 Conn. LLC v. CBRE, Inc.

Summary

The Appellate Division, First Department held that CBRE's brokerage agreement with SL 4000 was void and unenforceable under the District of Columbia dual-representation statute because CBRE acted as a subagent and lacked the required written consents. The court vacated the judgment awarding CBRE approximately $19.9 million in additional commissions, declared that plaintiffs had no further obligation to pay the remaining commissions, and declined to order disgorgement of the commission already paid.

Holdings

1. The prior appellate determination that CBRE had a brokerage relationship with plaintiffs was the law of the case and controlled on remand.
2. CBRE was subject to the statutory written-consent requirement because plaintiffs' property manager was authorized to retain CBRE as a subagent, making CBRE an agent of plaintiffs for purposes relevant to the transaction.
3. The brokerage agreement was void and unenforceable because CBRE failed to obtain the written consents required by D.C. Code § 42-1703(i)(1) for its dual representation.
4. CBRE was not entitled to summary judgment on its counterclaims seeking the remaining commission because the brokerage agreement was void and unenforceable.
5. Disgorgement of the 50 percent commission already paid was not warranted on the facts presented.

Questions Presented

1. Whether the prior appellate determination that CBRE had a brokerage relationship with plaintiffs was binding under the law-of-the-case doctrine.
2. Whether CBRE's status as a subagent appointed by plaintiffs' authorized property manager subjected it to the written-consent requirements of D.C. Code § 42-1703(i)(1).
3. Whether the brokerage agreement was void and unenforceable because CBRE failed to obtain written consent to its dual representation.
4. Whether CBRE was entitled to summary judgment on its counterclaims seeking the remaining brokerage commission.
5. Whether plaintiffs were entitled to disgorgement of the commission already paid to CBRE.

Disposition

other