Hillis v. Lake
Massachusetts Supreme Judicial Court
658 N.E.2d 687 (1995)
Hillis, Brady, and their brokerage firm (plaintiffs) negotiated a 1988 contract for Lake (defendant) to sell his commercial property, contingent on an inspection confirming Lake's good-faith belief the property was free of hazardous materials; the sale collapsed when the inspection found contaminants. The following year, Lake negotiated and closed a second sale without the firm's help, but under materially riskier terms that later forced him to repurchase the property when he could not remove the contaminants in time. The trial court found Lake responsible for the first sale's failure and awarded the firm its commission, but the appellate court reversed, and the firm appealed.
Whether a real estate broker is entitled to a commission on an unsuccessful transaction when the failure to close was due to the seller's bad faith or wrongful conduct.