Contract: Realtor’s claim for commission is reinstated

Where a realtor alleged facts making it plausible that it was owed a commission, the circuit court erred when it granted a demurrer on this claim.

Background                                            

When Ann Darst decided to sell her home and property in Williamsburg, the property was subject to a right of first refusal held by the City of Williamsburg. However Darst and the City could not come to an agreement on the purchase price.

Darst then spoke with Walker Ware, the owner of Ware Creek Real Estate Corp., about her displeasure that the city did not offer her an amount “that she believed reflected its value.” During the same time, George and Susan Valashinas contacted Ware about their interest in buying a farm in the Williamsburg area. Ware told the Valashinases to look at Darst’s property, and, after doing so, they offered Darst $1 million for the property.

After the city then invoked its right of first refusal, Ware Creek maintained it was entitled to a commission. To proceed with closing on the property, Darst and the city entered into an escrow agreement to deposit the disputed commission with an escrow agent.

Ware Creek then filed suit, alleging the city purchased the property “under the same terms and conditions” of the offer to purchase and accordingly had an obligation to pay Ware Creek the commission. It also alleged that it was a third-party beneficiary of the escrow agreement. As to Darst, Ware Creek alleged that she also breached the offer to purchase and had a “legally enforceable obligation” to pay the commission to Ware Creek. The circuit court ruled against Ware Creek on all claims.

City

The offer to purchase states that “[p]urchasers hereby direct the closing agent to pay [Ware Creek] 6% (six percent) of the total sales price at closing.” It is further specified that “the purchaser(s) shall pay the realtor fee.”

Ware Creek alleged that the city purchased the property “under the same terms and conditions as set forth” in the offer to purchase, “including but not limited to, paying Ware Creek the Commission it earned.” The deed confirms that the city, if it chooses to accept an offer on the property, purchases the property “upon the same terms and conditions as set forth in the offer.”

Accordingly, Ware Creek sufficiently alleges that the city agreed to direct the closing agent to pay Ware Creek its real estate commission, and thus breached the agreement by not doing so. Therefore, the circuit court erred in sustaining the city’s demurrer.

Escrow agreement

Ware Creek argues that the circuit court erred in sustaining Darst’s demurrer because it sufficiently alleged it was third-party beneficiary of the escrow agreement. The court disagrees.

The escrow agreement plainly states that Darst and the city disputed Ware Creek’s right to the commission. Indeed, the escrow agreement states that Ware Creek “has asserted a claim to a 6% commission on such sale, which Darst and [the city] dispute.” It is clear from the language of the escrow agreement that Darst and the city entered into this agreement for their own benefit, not Ware Creek’s.

Darst

Ware Creek’s breach of contract action against Darst fails as a matter of law, because the offer to purchase never became an operative contract. The offer to purchase stated “[p]urchasers understand and acknowledge that there is a ‘first right of refusal’ with the [C]ity of Williamsburg with terms and conditions which may affect the outcome this contract of purchase.”

It follows that the offer to purchase was not operative as a contract until the city declined to exercise its right. And so, because the city elected to exercise its right of first refusal, the condition precedent was not met and the offer to purchase never took effect.

Affirmed in part, reversed in part and remanded.

Ware Creek Real Estate Corp. v. Dandridge K. Davis and Jonathan B. Keyser, co-executors of the Estate of Ann B. Darst, Record No. 2128-24-1, Nov. 25, 2025. CAV (unpublished opinion) (Frucci). From the Circuit Court of the City of Williamsburg and County of James City (Smith). Bruce E. Arkema (Matthew B. Arkema; Durrette, Arkema, Gerson & Gill, on briefs), for appellant. Lynn K. Brugh, IV (Williams Mullen, on brief), for appellee Dandridge K. Davis and Jonathan B. Keyser, Co-Executors of the Estate of Ann B. Darst. Christina W. Shelton, City Attorney (Jacob Rogers Lambert, Assistant City Attorney, on brief), for appellee City of Williamsburg. VLW 025-7-339. 8 pp.