Broker Wins Non-Compete Suit
Judge issues injunction to stop agent from competing with her former employer.
(Mountain Lakes, NJ, July 19, 2018) — In a ruling that might pave the way for brokers to set tougher contracts with agents, a Florida judge sided with a broker who accused a former agent of violating a non-compete agreement.
Shelly Gibson worked for five years as an agent at Signature Real Estate Cos. She handled sales and rentals at Kings Point Signature Real Estate, a division of the company that specializes in sales and rentals at the Kings Point retirement community near Delray Beach, FL.
In August 2017, Gibson negotiated a slightly more generous split agreement that boosted her share of some deals to 75 percent from 70 percent. She agreed to pay a termination fee of $1,495 if she left within two years.
As part of the deal, Gibson signed an agreement not to compete with Signature Real Estate in any of its retirement communities for two years.
A few weeks later, she resigned and moved her license to her own brokerage.
In May, a judge issued an injunction in which he ordered Gibson to stop competing with her former employer.
The real estate industry long has been characterized by a revolving door of agents, and it’s rare for brokers to insist on formal contracts that spell out non-compete agreements and other penalties when agents leave. However, Ben Schachter, head of Signature Real Estate, says the contracts have worked well for him. His company has 650 agents and has been adding offices in South Florida.
More on non-competes, disclosure issues, commission competition, and discounter models appears in the July issue of Real Estate Broker’s Insider. Click below to learn more about the Insider, the only news source exclusively for residential real estate brokers, owners, and managers.
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