## Facts

- Paul E. Drake owned land near North Pole, Alaska, and signed an exclusive listing agreement with broker Charles F. Hosley for March 5–30, 1984.
- The listing promised a 10% commission if Hosley (1) located a buyer “willing and able to purchase at the terms set by the seller,” or (2) the seller entered into a binding sale during the listing term.
- Hosley procured three buyers; on March 23, 1984, Drake and the buyers signed an “earnest money receipt” setting price and terms, calling for closing “within 10 days of clear title” and “ASAP, 1984.”
- A typed addendum, signed by Drake and Hosley, stated Drake would pay Hosley a commission of 10% of the price paid for the property.
- A preliminary title commitment identified a judgment in favor of Drake’s ex-wife as an encumbrance; Drake’s attorney stated it would be paid from closing proceeds.
- Drake sought an April 11 closing to take advantage of a discounted settlement deadline; the parties disputed whether Hosley agreed to an April 11 closing or only to try to close quickly.
- On April 11, Hosley informed Drake’s attorney the buyers could not close that day and would have the down payment around May 1.
- Drake withdrew from the transaction by letter dated April 11 and sold the property to different buyers on April 12 through another broker.
- Hosley later attempted to tender checks for the original buyers’ down payment, but Drake’s attorney refused them because the property had been sold.
- Hosley sued Drake for the 10% commission; the superior court granted summary judgment for Hosley.

## Issues

1. Whether the broker earned a commission under the exclusive listing agreement by producing buyers who executed a binding purchase contract on the seller’s terms, even though the sale did not close.
2. Whether alleged broker misconduct (including an asserted promise to close by April 11 or acting for the buyers) created a triable issue of fiduciary breach barring recovery of a commission.
3. Whether summary judgment was proper on the commission and fiduciary-duty defenses.

## Decision

- The Alaska Supreme Court affirmed summary judgment for Hosley.
- The court held Hosley earned the commission when he produced buyers who entered into a binding purchase contract on Drake’s terms; closing was not a condition to earning the commission under the agreement and governing rule.
- The court held no genuine issue of material fact existed that Hosley breached fiduciary duties sufficient to defeat the commission claim.
- The court concluded the sale failed because Drake withdrew and sold to others, not because of broker fault, and that the written contract terms governed the time for closing.

## Legal Principles

- Under the traditional rule for real-estate commissions, a broker earns a commission upon producing a buyer ready, willing, and able to purchase on the seller’s terms, even if the transaction is not completed, unless the failure is attributable to the broker.
- An executed purchase contract on the seller’s terms is strong evidence that the broker has satisfied the “ready, willing, and able” requirement.
- Courts will generally apply the written terms of the listing and sale contract to assess performance obligations; informal understandings about closing dates do not alter those obligations absent authority and proof.
- A seller’s unilateral withdrawal from a binding transaction and sale to another purchaser does not defeat a broker’s accrued right to a commission where the broker has already met the listing’s earning conditions.
- Summary judgment is appropriate where the material facts about the listing agreement, executed purchase contract, and causation of nonperformance are undisputed and the asserted defenses do not raise a genuine factual dispute.

## Conclusion

The court held the broker earned his commission by producing buyers who entered a binding contract on the seller’s terms, and the seller’s later withdrawal and resale did not defeat that right; alleged fiduciary breaches failed to raise a genuine issue of material fact.


Drake v. Hosley, 713 P.2d 1203 (Alaska 1986)