Broker Lawsuit: Mike Joyce Is Right, But Does That Really Matter?
Who Really Pays Those Commissions?
This story is part of a series that Loose Cannon and Phil Friedman of For Yacht Builders, Buyers and Owners have teamed up to write in covering the multiple class-action suits that have been filed against several major players in the U.S. yacht brokerage sector. It also takes up a theme introduced in a previous Loose Cannon story introducing a confidential source, “Deep Bilge.”
Michael Joyce, CEO of Hargrave Custom Yachts of Fort Lauderdale recently published an article on LinkedIn posing the question, who really pays the commission in a yacht brokerage deal? In Joyce’s somewhat ironic view, the yacht broker does.
I’ve known Mike Joyce since I was a senior editor at Power and Motoryacht magazine. In the intervening years, if I learned anything about Mike, it’s that he doesn’t run with the current. Consequently, whether or not you agree with him, it’s generally worthwhile to at least consider what he has to say:
The seller knows he pays all the commission in yacht brokerage, right? I mean the entire commission is listed right there on the seller's closing statement.
Joyce then goes on to make the point (as did “Deep Bilge” in a previous story about the litigation) that both buyer and seller know and agree to the rate of commission prior to initiating the transaction that results in the sale of the yacht. So, Joyce argues, the commission rate certainly doesn’t come as a surprise to either party to the sale; and neither should have a beef about it post-closing.
Another Joyce quip:
When it comes to commissions, the only thing the seller and buyer both agree on is that the broker is not worth the money.
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