It's Time To Rewrite Wisconsin's Single-Party Listing Agreement

A note to the drafters of Wisconsin's single-party listing contract: It's time to redefine what triggers the payment of a commission under the contract after a recent decision of Wisconsin's supreme court in Ash Park, LLC v. Alexander & Bishop, Ltd, 2015 WI 65, where the court permitted a broker to collect its commission, despite never having delivered a viable buyer.

Ash Park is no stranger to the appellate courts in Wisconsin. The case first wound its way through the courts over five years ago when the buyer, Alexander & Bishop, failed to perform on a contract to purchase a vacant parcel of land for $6.3 million from the seller, Ash Park. The supreme court's first foray into the dispute, Ash Park, LLC v. Alexander & Bishop, Ltd., 2010 WI 44, affirmed the award of specific performance in favor of Ash Park.

Specific performance is an extraordinary remedy, but, if the buyer doesn't have the cash, which was the case with Alexander & Bishop here, it's also a toothless remedy. The third branch might have a considerable number of powers, but printing money still wasn't one of them when we last checked.

Ultimately the parties settled for $1.5 million, covering Ash Park's cost of holding the property during the litigation and its cost of securing the award. The messy ordeal appeared to be at an end.

But not so fast. Enter the deal's broker, arguing that Ash Park and Alexander & Bishop had an "enforceable contract" by virtue of the order for specific performance, which would entitle it to a 6% commission under its listing agreement with Ash Park, or $378,000 (which is 6% of $6.3 million). Never mind that the order wasn't worth (to Ash Park) the paper that it was written on.

The circuit court granted Ash Park's summary-judgment motion, for it wasn't about to create what it viewed as a windfall for the broker, who, to its thinking, hadn't produced anything of value. "The reality of it is the realtor brought to these...