What happens if an owner fires a brokerage firm prior to closing but agrees to pay the associate broker a fee?

In this scenario, the appropriate choice is based on the guidelines governing real estate transactions and the relationships between brokers, associates, and clients in New Mexico. When an owner terminates a contract with a brokerage firm, the status of the associate broker's ability to receive payment becomes a crucial element.

The associate broker, as a representative of the brokerage firm, typically operates under the umbrella of that firm’s agreements and policies. Even if the owner expresses a willingness to pay the associate broker directly, the broker must adhere to the commission structures set forth in their contract with the owner and the policies of the brokerage. Direct payment from the owner to the associate bypasses the brokerage firm and can create issues related to commissions, including potentially violating the terms of their agreement. Hence, the associate broker cannot accept the fee, as it would contradict the established protocols of the brokerage firm and could result in legal or ethical violations.

This clarification on the relationship between the brokerage, the associate broker, and the property owner highlights the importance of adhering to contractual obligations and the potential consequences that result from the termination of a brokerage agreement. The other options involve various facets of contractual law and real estate practice that do not accurately reflect the rules governing fee acceptance post-termination of a brokerage agreement.