Lawsuit for Broker Commissions on Policies Renewals in New York

In Apostolos v. RDT Brokerage Corp. (159 AD2d 62, 559 N.Y.S.2d 295 [1st Dept 1994]), where an insurance broker sued for commissions allegedly earned on policies he secured and on subsequent renewals of those policies, the First Department held that the portion of the agreement for commissions earned by renewal of such policies violated the Statute of Frauds. The court explained that since the agreement was terminable at will as to the earning of commissions on original policies placed by plaintiff, defendant's agreement to pay commissions for original policies was enforceable. However, defendant's promise to pay commissions on the renewals of such policies violated the Statute of Frauds, since it was not alleged that defendant could decline the renewal policies and thus, the potential for defendant's liability was indefinite and dependent solely on the acts of a third party (Apostolos at 64-65).