Court Opinion

ID: 9760643
Source: CourtListenerOpinion
Date Created: 2023-08-29 01:06:31.393083+00
Date Added: 2024-06-11T07:29:15.317050
License: Public Domain

Justice LaVECCHIA,
dissenting.
As the majority duly notes, the obligation to pay a brokerage fee or commission is “personal.” Ante at 116, 965 A.2d at 1177. In other words, it does not attach to the land and run to a subsequent owner of the property. See VRG Corp. v. GKN Realty Corp., 135 N.J. 539, 556, 641 A.2d 519 (1994) (citing Longley-Jones Assocs., Inc. v. Ircon Realty Co., 115 A.D.2d 272, 496 N.Y.S.2d 155, aff'd, 67 N.Y.2d 346, 502 N.Y.S.2d 706, 493 N.E.2d 930 (1986) (stating that “grantee is only liable for those covenants that run with land [and a] covenant in a lease to pay a broker’s commission upon renewal of the lease does not run with the land”) (internal citations omitted)). For such an obligation to attach to a purchaser of real estate, when the seller had only a personal contract requiring the payment of commissions to a real *120estate broker, the purchaser must “affirmatively assume” the obligation. Id. at 556, 641 A.2d 519.
For more than a decade, skilled professionals in the world of commercial real estate relied on our decision in VRG. Through its insistence on an affirmative assumption of a specific fee obligation to a real estate broker, VRG provided clarity for that marketplace. Because, in my view, the requirement of a clear and unequivocal affirmative assumption of such an obligation brings valuable structure and certainty to the commercial real estate marketplace, I would take a strict approach when examining documents said to contain a purchaser’s affirmative agreement to assume an otherwise personal contractual responsibility of the seller. Thus, the bar should be high when examining the documents said to contain an affirmative undertaking by the purchaser to pay to a broker the fees or commissions that would have been due under the seller’s purely personal contract with the broker.
In this ease, I find, quite simply, that what was, in fact, done, did not pass muster. As the Appellate Division noted in its own examination of this matter,
[n]owhex-e in this record has defendant agreed to pay any commissions to Pagano. Defendant merely agreed to assume all of the lessor’s obligations in the leases. The only obligation the lessor has in the leases regarding the broker’s commissions is the duty to indemnify and hold the tenants harmless for claims of the broker. Paragraph 44 of each lease states that “Lessor represents and warrants to Lessee that Lessor has dealt exclusively with Pagano Company and that by separate commission agreement letter of understanding said broker shall be paid a commission by Lessor-.” This sentence is a x-epx-esentation and wax-x-anty to the tenants, not the undertaking of an affirmative obligation to Pagano. The sentence further expressly states that the lessox-’s obligations to the broker ax-e detex-mined in a sepax-ate bx-okex-age agx-eement. Thus, Pagano’s x-ight to commissions ax-ises from the separate bx-okex-age agx-eement and not fx-om the lease. The balance of pax-agx-aph 44 requires the lessor to pay its obligations to Pagano and to indemnify and hold the tenants harmless if Pagano makes claims against the tenants for bx-okex-’s commissions.
The px-ovisions in the leases reflect the agx-eement between the lessor and lessees setting forth their rights and obligations to each other. Pagano is not a party to the leases, and no px-omises ax-e made to Pagano in the leases. Nowhex-e in the contract, closing documents, assignment, or indeed in any other document did *121defendant make a promise to either Heritage or Pagano to pay commissions to Pagano.1
Furthermore, in addition to the Appellate Division’s reasoned observations, neither the Exclusive Leasing Agreement nor the Schedule of Lease Commissions unequivocally indicates that it will have ongoing effect. Nor do the documents set forth any specific commission obligation to be assumed. The contradictory language in those documents, about what is due, when, and for how long, introduces ambiguity into the analysis, leading to an inconclusive combined effect in respect of any clear ongoing liability for fees. For me, that additional ambiguity further undermines the persuasiveness of the totality-of-the-circumstances analysis employed by the majority to reach its conclusion in this matter.
In sum, I find insufficient evidence in the pertinent documents to hold the purchaser of this property liable. I agree with the Appellate Division that held that the general assignment executed here, which incorporated by reference lease documents that did not contain any covenant or promise to the broker about the payment of commissions, failed to demonstrate a clear affirmative assumption by the purchaser to pay broker commissions. Accordingly, I respectfully dissent. I would affirm the judgment of the Appellate Division.
Chief Justice RABNER joins in this opinion.
For reversal and reinstatement—Justices LONG, ALBIN, WALLACE, RIVERA-SOTO and HOENS—5.
For affirmance■—Chief Justice RABNER and Justice LaVECCHIA—2.

 The Appellate Division further noted the important factual distinctions between this case and that of Bacharach v. Mitnick, 121 N.J.L. 401, 3 A.2d 92 (Sup.Ct.1938). In Bacharach, the lease contained language obligating the lessor to pay the broker and set forth the terms of the commission arrangement. Id. at 404, 3 A.2d 92.