Real Estate Agent Suing Me

[Jason Callahan]

Hello BP,

Last September I wanted to get in the flipping game. I had some cash and wanted to rehab a property. The long and the short of the story is that I signed a "Exclusive Buyer Agreement" with an agent to help me find a home that I could rehab and flip to make around $20,000. I immediately wanted him to send me RMLS properties that he said he would comb over daily and send me links to. He knew I was inexperienced and said that he would find me the deals. This never happened despite my asking and following up with regarding it. We did go out twice and looked at a total of six properties. I even made offers on two of them, one was rejected. The other property I made the offer on was a short-sale and I literally never heard back from him regarding the decision the bank made. By the middle of January I received no communication from him at all. No properties, nothing. I started looking for properties on my own in a different county than the one we agreed he would work. I found one at the end of March. It was presented by a consultant and I paid cash for it. I actually didn't even think about the agreement because it was an off-market property in a different county than the agreement stated. I rehabbed the property and it is on the market now. 

This afternoon, Friday at 1:00pm. I received an extremely threatening email from this agent that stated I had breached the agreement. His first option he gave me was that I commit to paying him the 2.5% buyer commission and $2500 in penalties equalling $10,000. I had to commit to him in 24 hours that I would pay him this amount or he was going to demand more money. He would then want the buying and selling commissions and penalties which amounted to almost $20,000. The day I settled on my off-market property was 1 day before the buyer agreement expired. 

I need advice about what to do.  I hate to give my money away to some lazy *** real estate agent. I consulted my attorney, he said that we should write a letter to him stating that he did not fulfill his obligation as an agent in the agreement, that the county I bought the property in is not listed on the agreement,  that the property was not on mls. Also, that he would write a complaint with the real estate ethics board.  Going through with this would also affect his reputation as word would get around regarding this.

My feeling is that I was a good faith buyer in that I made offers on the limited properties that he gave me. There was no follow-thru on his end on oral promises about presenting properties. Then he gave up entirely on me in January and that was that. I worry that the agreement lists  "county + surrounding areas" for the agreement. The property I bought was one county over and many miles away from the listed county in an area that he never articulated to me that he worked. 

Please help with any advice. Should I just pay? Fight it?