The Listing Agreement: Only licensees can claim real estate commissions

Occasionally we have a client either pursuing or defending againstĀ the payment of aĀ fee for professional services renderedĀ in conjunction with theĀ sale of a piece of real property in Ohio, essentially a realĀ estate commission.

One prerequisite that is not always met by the claimant, however, is licensure as a real estate broker. Ā It may be an accountant, attorney, or other individual who has assisted — or claims to have assisted — in the sale of real property. Ā But that person is not licensed as a real estate broker in Ohio. Ā Ā Still, they want to be paid just as a Realtor would have been. Ā And they may even have an expressĀ agreement — even a written agreement — for payment of those sums.

But it is a defense — perhaps an absolute defense — under Ohio law againstĀ the payment of those sums if the party claiming payment does not allege and prove in aĀ court action that they are a licensed realĀ estate broker. Ā O.R.C Ā§4735.21 provides, in pertinent part:

No right of action shall accrue to any person, partnership, association, or corporation for the collection of compensation for the performance of the acts mentioned in sectionĀ 4735.01 of the Revised Code, without alleging and proving that such person, partnership, association, or corporation was licensed as a real estate broker or foreign real estate dealer.

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