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Write All Deals or Get No Pay, State Judges Say

November 29, 1987

Brokers representing buyers or sellers, need written, not oral, agreements if they expect to get paid, the California Supreme Court has ruled.

The 5 to 2 decision upheld an earlier Court of Appeals ruling.

"There is no magic about whom the broker works for; the real question is, who does the broker expect to pay his or her commission," explained Kenneth B. Bley of the law firm of Cox, Castle & Nicholson, Los Angeles. "In California, a broker is required by statute to have a written agreement with the principal.

The court, in handing down its ruling, quoted movie producer Samuel Goldwyn who is alleged to have said, "An oral agreement isn't worth the paper it's written on."

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