Substitute Senate Bill No. 1395

Public Act No. 01-88

AN ACT CONCERNING COMMERCIAL REAL ESTATE BROKERAGE.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

(NEW) (a) If a landlord or tenant in a commercial real estate transaction enters into an agreement pursuant to subsection (b) or (c) of section 20-325a of the general statutes for the payment of compensation, or the promise of payment, to a real estate broker in consideration for brokerage services rendered in connection with the consummation of a written lease, then notwithstanding any provision of law under which such compensation may otherwise be considered the personal obligation of the original landlord or tenant specifically named in the written lease, the agreement shall constitute a binding contractual obligation of such landlord or tenant, as the case may be, and the landlord's or tenant's grantees, successors and assigns. Upon any sale, transfer, assignment or other disposition, including, but not limited to, any such disposition by reason of the enforcement of a mortgage, lien, deed to secure debt or other security instrument of a landlord's interest in real property or upon any sale, assignment, transfer or other disposition of a tenant's leasehold interest, the succeeding party shall be bound for all obligations under such agreement accruing after the sale, transfer, assignment or other disposition with the same effect as if such succeeding party had expressly assumed the landlord's or tenant's obligations relating to the written agreement if: (1) The real estate broker has complied with the provisions of subsections (b) to (d), inclusive, of this section; (2) the succeeding party assumes the benefits of the tenancy; and (3) the agreement has not been waived in writing by the real estate broker.

(b) A real estate broker shall be entitled to the protections afforded by this section only upon the broker's recording a notice of commission rights in the land records in the office of the town clerk in the town in which the real property or leasehold interest is located not later than thirty days after the execution of the lease or the tenant's occupancy of the leased premises, whichever is later. The notice of commission rights shall (1) be filed before conveyance of the real property, (2) be signed by the real estate broker or by a person expressly authorized to sign on behalf of the broker, and (3) be in substantially the following form:

NOTICE OF COMMISSION RIGHTS

The undersigned licensed Connecticut real estate broker does hereby publish this NOTICE OF COMMISSION RIGHTS to establish that the lease referenced below was procured by a real estate broker pursuant to a written brokerage commission agreement providing for the payment or promise of payment of compensation for brokerage services.

Owner: ....

Landlord: ....

Tenant: ....

Lease date: ....

Lease term: ....

Project or building name (if any): ....

Real estate broker name ....

Address ....

Telephone number ....

Real estate license number ....

(c) Not later than thirty days after the real estate broker receives final payment of commissions due under the written brokerage commission agreement, the real estate broker shall provide the owner, tenant or mortgagee a statement, in a form suitable for recording on the land records, that indicates that the broker's commission rights are terminated.

(d) Notwithstanding any provision of this section, nothing in this section shall be construed to create a lien on the real property that is the subject of the lease.

Approved June 6, 2001