The procuring cause standard is a potential area of contract uncertainty for investment bankers, principals, and counsel in New York.
Under New York law, it is well-established that, absent an agreement otherwise, a real estate broker is not entitled to a commission unless she is the “procuring cause” of the sale or lease. The procuring cause requirement is not common in investment banking contracts. Nonetheless, a 2014 decision by the Court of Appeals. In this article, Curtis Leitner and MarcAnthony Bonanno assess the case law applying the procuring cause standard to investment banking contracts and suggest that contracting parties tread carefully.