How to Handle a Breach of a Broker Agreement: Legal Steps to Take

When you hire a broker, whether for real estate, business deals, or investments, you expect them to honor the terms of your agreement. But what happens when they don’t? A breach of a broker agreement can cost you money, time, and opportunities. If you’re dealing with this situation, you’re not alone, and you have legal options.

At our law firm, we regularly represent business owners, investors, and professionals in disputes with brokers. Below, we break down what you need to know if you find yourself facing a breach of contract.

What Is a Broker Agreement?

A broker agreement is a contract between you and a broker (real estate, business, or otherwise) that defines the broker’s role, responsibilities, and compensation. Common terms in these agreements include:

• The scope of the broker’s duties (e.g., finding a buyer, negotiating terms)
• Commission rates or fees
• Exclusivity (whether the broker is the only one who can represent you)
• Duration of the agreement
• Confidentiality provisions

Because these agreements involve money and high-value deals, a breach can create serious disputes.

What Counts as a Breach of a Broker Agreement?

A broker breaches the agreement when they fail to perform their contractual obligations. Some examples include:

• Failing to bring qualified buyers or tenants despite an exclusivity clause
• Disclosing confidential information to third parties
• Demanding commission for a deal they did not facilitate
• Misrepresenting the terms of a transaction
• Engaging in self-dealing or conflicts of interest

Whether intentional or negligent, these breaches often lead to litigation when negotiations break down.

Legal Remedies for Breach of a Broker Agreement

If your broker violates the agreement, you may be entitled to several remedies under Florida law:

1. Damages (Financial Compensation): You may recover the money you lost as a result of the breach, such as lost profits or overpaid commissions.
2. Rescission of the Contract: In some cases, you may seek to void the agreement entirely.
3. Specific Performance: Less common in broker disputes, but in certain cases a court may require the broker to fulfill their obligations.
4. Attorney’s Fees and Costs: If your agreement has a fee-shifting clause, you may be able to recover the cost of your legal representation.

Steps to Take if Your Broker Breaches the Agreement

If you suspect your broker has breached the agreement, here are the immediate steps to protect yourself:

1. Review the Contract Carefully: Look for key provisions such as exclusivity clauses, commission details, and dispute resolution terms.
2. Gather Evidence: Emails, text messages, and transaction documents can all help demonstrate how the broker failed to meet their obligations.
3. Attempt Resolution First: Sometimes, disputes can be resolved without litigation. Sending a formal demand letter through your attorney can lead to a settlement.
4. Consider Mediation or Arbitration: Many broker agreements include alternative dispute resolution clauses.
5. File a Lawsuit if Necessary: If negotiations fail, litigation may be the best way to recover losses and enforce your rights.

Florida Broker Agreement Disputes: What You Should Know

In Florida, disputes involving broker agreements often overlap with business litigation and real estate litigation. Courts take these agreements seriously, especially when they involve real estate transactions, which are tightly regulated.

Key points under Florida law:

• Brokers must comply with Florida real estate statutes and fiduciary duties.
• Courts will look at whether the broker acted in good faith and performed their contractual duties.
• Oral agreements may be enforceable in some cases, but written contracts are far stronger in court.

Why You Should Involve an Attorney Early

Broker agreement disputes can escalate quickly, and mistakes at the beginning (like responding without legal advice) can weaken your case. An experienced business and real estate litigation attorney can:

• Assess whether a breach occurred
• Determine the strength of your claims
• Draft a demand letter that increases the chance of resolution
• Represent you in court if litigation is necessary

Conclusion: Protecting Your Business Interests

When a broker breaches the broker agreement, it’s not just about losing money, it’s about protecting your business and future deals. 

If you believe your broker has breached your broker agreement, contact one of our experienced real estate attorneys in Miami at 305-570-2208. 

You can also reach our founding attorney, Eduardo A. Maura, at eduardo@ayalalawpa.com.

Schedule a case evaluation online here.

[The opinions in this blog are not intended to be legal advice. You should consult with an attorney about the particulars of your case.]