In a widely covered story last week, a judge ruled that Jerry Seinfeld had to pay a commission for a property he purchased, trying to bypass the broker that had originally showed the property on more than one occasion to his wife.
- Seinfeld Tries To Stiff Real Estate Agent (Not that there is anything wrong with that [Realty Times]
- Seinfeld loses real estate dispute [CNN]
- Comedian Seinfeld Ordered to Pay Real Estate Broker Fee [Law.com]
- Seinfeld’s Broker Fee Stiffing Won’t Stand [Gothamist]
- Seinfeld: Master of a More Expensive Domain [Yahoo TV]
The story is pretty straight forward. The commission was earned but Seinfeld thought the fact that the broker was not available at the exact moment he wished to view the property, the $100,000+ commission wasn’t earned.
It brings to mind a few thoughts:
- Did Seinfeld think someone would walk away from a 6-digit commission?
- Could he be that insulated from reality by his advisors?
- Could there have been some bad blood between the broker and his wife after the initial visits that would motivate this illogical behavior?
- Was the amount of money to be saved worth the bad public relations?
I wonder if he learned anything to avoid make the same mistake in future deals, and I would bet brokers dealing with him in the future will make sure their legal t’s are crossed and i’s are dotted.
When I was a real estate agent in Chicago in a prior life (early 1980’s), some of the worst individuals trying to re-negotiate the commission were the real estate attorneys at the closing table, trying to “earn” their fee. Snide remarks were common, along the lines of “thats a big commission for two 30 minute showings of a property, I wish I could bill that hourly rate.” (This was a market with an average sales price of about $90,000.) There was no appreciation for the 60 other showings made without a commission before this sale, advertising and marketing costs, travel costs, and other expenses. My mentor in the realty office back then, and still a good friend, would basically assume a “take no prisoners” position. When a discount was proposed, he would tersely suggest the lawyer take the same dollar discount (which was preposterous because the dollars the lawyer was being paid was less than the discount proposed) and he would not be afraid to stand fast and kill the deal altogether if the commission was to be re-negotiated – our firm was big on that and it usually worked, even though the market was very weak at the time. Hopefully things are generally better at the closing table in Chicago these days.
The generally weak public relations efforts of NAR has resulted in an unfair stereotype of the typical broker as not earning their commission. Of course there are some agents that deserve this criticsm like in any other profession, but not everyone does. Its sounds like Jerry was under the same impression as the stereotype. Given the generally low pay of the average real estate agent [Slate], despite all the media stories about high powered agents, makes this criticism pretty simplistic (not that there’s anything wrong with that).