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Gebroe-Hammer Associates, Inc. v. Sebbag

May 8, 2006

GEBROE-HAMMER ASSOCIATES, INC., PLAINTIFF-RESPONDENT,
v.
DAVID SEBBAG, DEFENDANT-APPELLANT, AND THE FIRST BANK AND TRUST COMPANY OF ILLINOIS, DEFENDANT.



On appeal from the Superior Court of New Jersey, Law Division, Ocean County, L-1567-02.

The opinion of the court was delivered by: S.L. Reisner, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued April 4, 2006

Before Judges Collester, Lisa and S.L. Reisner.

Defendant, David Sebbag, appeals from a final judgment entered upon a jury verdict in favor of plaintiff, Gebroe-Hammer Associates, for $122,500 in brokerage commissions, plus interest, for services in connection with Sebbag's purchase of a promissory note. Raising a novel issue, Sebbag contends that the Statute of Frauds applies to agreements to pay mortgage broker commissions. We disagree and affirm.

I.

This is what happened. First Bank & Trust Company of Illinois held a mortgage on an apartment building located at 555 Elizabeth Avenue in Newark, New Jersey. In 2001, First Bank decided to sell the note and mortgage after the property owner defaulted. Sebbag, a real estate investor, heard about the possible sale from a friend and then contacted his attorney, Tom Cohn, to see if Cohn had any information about the property.

Around the same time, David Oropeza, a real estate broker who worked for Gebroe-Hammer, heard that the owner of the Elizabeth Avenue property was in financial difficulty, and he investigated to determine the identity of the mortgagee. He eventually determined that the mortgagee was First Bank. Oropeza spoke with Philip Edison, a bank employee, and offered Gebroe-Hammer's services in selling the note. He attempted to get an exclusive right to sell the property, but the bank did not agree and told Oropeza he "would have to get paid by the buyer." Thus, Oropeza began discussing the property with clients to see if he could find a buyer for the note.

After speaking with Sebbag, Cohn thought Gebroe-Hammer might have information about the property, and he contacted a friend, Ken Uranowitz, also an employee of Gebroe-Hammer. Uranowitz asked another colleague, David Jarvis, to get involved because he was an "expert" in property in the Newark area. During a telephone conversation among Sebbag, Cohn, Uranowitz, and Jarvis, Sebbag indicated he wanted to retain Gebroe-Hammer to help him with the purchase. Sebbag testified that he wanted exclusivity so Gebroe-Hammer would not try to sell the note to anyone else, but Gebroe-Hammer's representatives refused.

During a later conversation between Oropeza, Uranowitz and Sebbag, the brokers informed Sebbag that the buyer would be paying the commission and they negotiated a rate of 3.5 percent. Oropeza and Uranowitz testified that Sebbag agreed to pay the 3.5 percent commission. According to Oropeza and Uranowitz, Sebbag never mentioned exclusivity.

Uranowitz faxed a proposed letter agreement to Sebbag; the letter stated it was "to confirm our understanding that I agree to pay to Gebroe-Hammer Associates a brokerage commission of

[t]hree and one-half . . . percent of the gross purchase price of the captioned Note in cash at closing."

According to Oropeza's testimony, Sebbag orally agreed to this arrangement, but he never signed the agreement. Oropeza testified that Sebbag never explicitly refused to sign the agreement; he simply never signed and returned it to Gebroe-Hammer. According to Sebbag, he told Gebroe-Hammer's ...


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