No I am not giving you legal advice, but this is the way I have done it.
If you want just a little advice, here it is. After years and years of mostly dealing with attorneys and legal sales, I can tell you that divorce is the hardest, most messy and most unforgiving. If you don't want to deal with a headache, don't do divorce. Here endeth the lesson.
In other types of legal sales such as bankruptcy and receivership (possibly probate also), professionals are engaged by the party responsible for the property. Sometimes this is by an owner as in a Chapter 13 or Chapter 11 bankruptcy (known as personal or corporate reorganization). Sometimes this is by the fiduciary as in a Chapter 7 bankruptcy (liquidation) or the Receiver (state court insolvency or dispute).
Following the signing of the listing agreement, a Motion must be filed with the appropriate Court approving both the broker and the transaction. Following the Motion, a period of time will elapse and during this period of time any party with standing in the case may Object. If there is an objection, the parties will either negotiate out of court and the objection will be withdrawn or there will be a Hearing. Following the hearing, the objection may be sustained meaning that your employment has been rejected. This does not happen often. Most times the objection period will expire and an Order will be entered finally approving your retention.
In bankruptcy the retention Motion is called an APPLICATION TO EMPLOY BROKER.
In receivership it is called a MOTION TO RETAIN BROKER.
This is how it is typically done here in the Columbus OH area.
Once you obtain a purchaser for the property, another round of Motions and Orders are required. This is typically in the form of a MOTION TO SELL FREE AND CLEAR.
The same process as before will ensue where parties disputing the sale at the price and terms are afforded the opportunity to object, have a hearing, etc.
Once the final Order is entered, the property can transfer to the purchaser, usually by a Fiduciary Deed. Sometimes the seller pays for title insurance and sometimes they do not. It all depends on the contract.
A couple of more items on this....
Should you decide to market the property without being properly retained in the Courts, you may run the risk of not being compensated.
Even if your listing agreement spells out your commission in detail, it can always be changed by the ultimate Court Order.
In bankruptcy, there is also an application for fees and expenses. It is not uncommon for the trustee to receive all of the funds at closing and require an additional application to the courts for a disbursement of your fees. This is a Motion that is brought by the Trustee, so my last word of advice here is to bust your butt if working in these situations because your fee is in the hands of others and is not guaranteed, especially if the Trustee feels that value of service was not commensurate with the fee amount.
Gotta Luv It.
Do you have questions about distressed assets, receivership or bankruptcy sales, auctions? Email me at rfk@gryphonusa.com and I'll try to answer it in an upcoming post.
Richard F. Kruse is the President of Columbus, Ohio based Gryphon USA, Ltd. (www.gryphonusa.com). The Gryphon Organization includes Gryphon Asset Management providing receivership and consulting services in the distressed marketplace, United Country Gryphon Realty & Auction Group (www.ucohiorealty.com & www.ucohioauctions.com) providing real estate brokerage and auction services throughout Ohio and OnlineAuctionUSA.com (www.onlineauctionusa.com) providing commercial asset liquidations from the Midwest to East Coast.
United Country Gryphon Realty & Auction Career Opportunities Available. Call 614-885-0020 x 17
Thanks for the info Rich. I learn something everyday!