Carmagnola v. Hann

In Carmagnola v. Hann, 233 N.J.Super. 547, 559 A.2d 478 (App.Div.1989), the Court invalidated a regulation promulgated by the Real Estate Commission that required all real estate contracts subject to attorney review to contain "an agreement to honor" clause effectively barring brokers from "showingthe property to other prospective purchasers" during the review period. Id. at 550, 559 A.2d 478. Citing the Supreme Court's approved settlement, we said that "the attorney review clause renders enforceability of realtor-drawn contracts illusory, at least during the three day review period." Ibid. The Court held that the "agreement to honor" mandated by the contested regulation collided with the underlying purpose of the settlement, i.e., to protect parties against being bound by broker-prepared contracts without the opportunity to obtain adequate protection of their separate interests. Id. at 552, 559 A.2d 478. The Court noted in passing that "the plenary power of either party's attorney to cancel a contract rendered problematic enforcement of the agreement to honor," adding that "arguably, no damage could flow to an aggrieved party from violation of such an agreement if timely disapproval by an attorney abrogates the underlying contract." Ibid. n. 3.