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Mich. Comp. Laws § 339.2512a provides that only parties licensed as real estate brokers may bring an action to collect a commission on certain types of real estate transactions.
Plaintiff, Turner Holdings, Inc. ("THI"), a New York investment banking company, entered into a "letter" agreement with defendant Howard Miller Clock Company ("HMCC"), a Michigan furniture manufacturing company, whereby THI agreed that it would "endeavor to locate appropriate candidates for acquisition and to advise you as to the best way to proceed towards one or more completed transactions." THI sought to recover $177,000, which it alleged is due as a success fee under the contract as a result of HMCC’s acquisition of Hekman Furniture Company, a company which THI claimed was "under consideration" during the term of the contract. THI also sought $968.44 to cover reimbursable expenses which it incurred during the term of the contract. HMCC contended that the action was barred by Mich. Comp. Laws § 339.2512a, which required real estate brokers to have a license to collect a commission, and that "under consideration" was latently ambiguous and had a special meaning which had not been communicated to the investment firm.
Was the suit barred by the operation of the Michigan Real Estate Brokers Act, MCL § 339.2501, et seq?
The court held that THI’s services were analogous to investment banking, not a real estate broker. Michigan Real Estate Brokers Act did not apply. Neither Turner nor THI are licensed in Michigan under this statute. HMCC could not bind THI with its uncommunicated special meaning. Judgment was entered for THI.