• Non-Compete Agreements
• Tortious Interference
• Breach of Fiduciary Duty
• Breach of Contract

Commission Agreements, Finders Fees and New York's Statute of Frauds

While there is more than a grain of truth to these thoughts, it should come as no surprise that many of these assumptions are also erroneous. In point of fact, absent a written agreement (which is often the case, particularly in an at-will employment), New York's courts have distinguished between an employee's commissions - which may be recoverable - and a non-employee's finder's fees - which are generally not recoverable.

Generally speaking, the Statute of Frauds (N.Y. Gen. Obl. Law 5-701, et seq.) , bars a claimant from recovering damages on a breach of contract claim if the agreement was not reduced to writing, and the agreement could not have been performed within one year. Applying that rule, New York's courts have held that the "negotiation of business opportunities," or "fee-finders" arrangements fall squarely within the ambit of the Statute of Frauds, and therefore, the essential terms of agreement must be reduced to writing in order to be enforceable.

On the other hand, as in Nichols v. SG Partners, Inc., where the claimants were not mere "negotiators," and their role vis-a-vis the defendant was neither transitory nor limited, and the oral contract is intended for the hiring of individual employees rather than the formation of a new business entity (or the acquiring of an existing entity), such damages can be recoverable, as they fall outside the purview of the "business opportunities" provision of the Statute of Frauds.