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The Procuring Cause Doctrine in Florida Real Estate Transactions

On Behalf of | Oct 30, 2023 | Real Estate Broker |

The procuring cause doctrine, as it applies to real estate transactions, is an equitable doctrine that holds a broker is entitled to a commission when the broker has introduced the buyer and seller and inaugurates continuous negotiations of which the broker is a part, leading to a sale unless the buyer and seller intentionally exclude the broker. When the buyer and seller exclude the broker the requirement that the broker engage in continuous negotiations is vitiated.

The question arises “Is the doctrine applicable when the listing agreement contains an integration clause?” The answer may be “Yes” or “No.” If the integration clause provides that there are no other terms than those contained in the contract and the contract can only be modified by an instrument in writing, it is likely all rights to a commission come to an end at the expiration of the listing agreement and any protective period.  The rationale for this is that where the parties have a written agreement that is the final expression of their terms, the court cannot inferentially incorporate a term not agreed to by the parties and supersede the written terms of the contract.

In practical terms, the procuring cause doctrine is applicable to oral listing agreements or written listing agreements that do not contain an integration clause, or an express agreement between the parties, broker and seller, whether written or oral, that the procuring cause doctrine is a term of their listing agreement.

If you are a real estate broker, it pays to have your listing agreement reviewed by an attorney before signing.