An escrow officer was handling a sale transaction involving separate listing and selling brokers. On January 22, 2016, a commission advance company emailed the escrow officer a Commission Advance Agreement and a Commission Disbursement Authorization electronically signed by the selling broker — who was also the selling agent — who we will refer to as "Ms. Jones." The escrow officer received the email but did not respond affirmatively to the receipt of the commission advance company documents.

On January 25, 2016, the commission advance company emailed again, insisting the escrow officer acknowledge receipt of the agreement and authorization forms. Again she did not respond. Eventually Jones emailed the escrow officer and requested she acknowledge receipt of the agreement and authorization documents. She replied she had received the documents.

On January 29, 2016, the listing broker deposited Instructions to pay commission in the amount of $9,270 to the listing broker and $7,270 to Jones. The escrow officer sent the instruction to Jones to acknowledge.

Much to the escrow officer's surprise, Jones directed her to wire transfer the funds directly to her personal checking account — not to the commission advance company as previously instructed.

The escrow officer contacted Jones who again insisted the commission be wire transferred to her personal checking account. At closing the escrow officer proceeded as instructed and wired $7,270 to Jones' personal account.

The commission advance company emailed and called the escrow officer repeatedly for payment. The escrow officer referred the commission advance company back to Jones. When they were unable to collect repayment of the advanced commission, they filed an action in small claims court against Jones and the title company.

On the assigned court date two representatives from the commission advance company appeared, as well as a representative of the title company — Jones did not appear. The judge asked the plaintiff to explain why they were suing the two defendants.

The plaintiff provided a copy of the signed Commission Advance Agreement and Commission Disbursement Authorization, as well as an email response from the escrow officer acknowledging she had received both documents. The commission advance company representatives thought they had produced enough evidence to force the title company to pay their advance, since they failed to collect on their behalf at close of escrow.

The title company representative was then given an opportunity to explain why they were not a party to the agreement. The title company representative explained the listing broker owned 100% of the commission through the listing agreement signed by the owner of the subject property.

The title company representative provided the written instructions from the listing broker directing payment to Jones and the instructions from Jones dated after the date of the agreement and authorization documents, re–directing payment to her personal checking account via wire transfer.

The judge stated he sold real estate to pay his way through law school and had been a real estate agent for forty years. He told the commission advance company they had no grounds for a suit against the title company as they were not a party to the agreement, nor were they the collection agent for the commission advance company.

The judge dismissed the title company from the lawsuit altogether. He did grant the commission advance company a default judgment against the real estate agent/selling broker for the maximum allowable in that jurisdiction under small claims, which was $5,000.