I respectfully dissent.
The majority opinion broadly holds that except in cases of actual fraud, a licensed real estate broker may not assert equitable estoppel to avoid the statute of frauds—regardless of the particular facts and circumstances of the case, of the relative equities of the parties, or of the injustice that may result absent an estoppel. Neither settled law nor sound public policy supports such a harsh and inflexible rule. My views on the matter are set forth below.
The first statute of frauds was enacted several hundred years ago to prevent “many fraudulent practices . . . .” (An Act for Prevention of Frauds and Perjuries, 1677, 29 Car. 2, ch. 3 (1677).) Its function in modern society has been described as two-fold; first, “evidentiary,” in the sense that a writing obviates the opportunity for fraud through perjury and limits disputes over whether a contract has been formed or over the terms thereof; and second, “cautionary,” on the theory that a writing serves to prevent hasty bargains and impresses upon the parties the solemnity of the agreement. (See Comment, Equitable Estoppel and the Statute of Frauds in California (1965) 53 Cal.L.Rev. 590, 591.) Thus as the majority opinion points out, the statute of frauds enjoys continued vitality today in the form of numerous and varied consumer protection statutes. (Majority opn., ante, at p. 1265.) And both evidentiary and cautionary functions are clearly well served by provisions such as the one at issue here, subdivision (d) of Civil Code section 1624 (hereafter section 1624(d)), which provides, inter alia, that agreements authorizing a broker to find a purchaser or seller of real estate must be in writing and signed by the party to be charged. As the majority opinion notes, section 1624(d) serves both to “protect real estate buyers and sellers from unfounded claims for brokers’ commissions . . .”, as well as to impress on “contracting parties the significance of their agreement.” (Majority opn., ante, at p. 1266].)
The doctrine of equitable estoppel developed out of the recognition that equity must occasionally estop the assertion of the statute of frauds precise*1272ly in order to prevent the perpetration of a fraud. (See Colon v. Tosetti (1910) 14 Cal.App. 693, 695 [113 P. 365] [“The statute of frauds is for the prevention, not in aid of the perpetration, of fraud.”].) In Monarco v. Lo Greco (1950) 35 Cal.2d 621, 623-624 [220 P.2d 737], this court established and explained the modem doctrine as follows: “The doctrine of estoppel to assert the statute of frauds has been consistently applied by the courts of this state to prevent fraud that would result from refusal to enforce oral contracts in certain circumstances. Such fraud may inhere in the unconscionable injury that would result from denying enforcement of the contract after one party has been induced by the other seriously to change his position in reliance on the contract [citations], or in the unjust enrichment that would result if a party who has received the benefits of the other’s performance were allowed to rely upon the statute. [Citations.] In many cases both elements are present. Thus not only may one party have so seriously changed his position in reliance upon, or in performance of, the contract that he would suffer an unconscionable injury if it were not enforced, but the other may have reaped the benefits of the contract so that he would be unjustly enriched if he could escape its obligations. [Citations.]” (Italics supplied.)
Under the broad equitable principles set forth in Monarco, the trier of fact exercises considerable discretion in determining whether to enforce the statute of frauds or to estop its effect in the interests of justice. (See Mehl v. People ex rel. Dept. Pub. Wks. (1975) 13 Cal.3d 710, 715-716 [119 Cal.Rptr. 625, 532 P.2d 489] [“Estoppel is a question of fact, and the determination of the trier of fact is binding on appeal unless the contrary conclusion is the only one that can reasonably be drawn from the evidence.”].) Each case requires a balancing of the interests of the plaintiff that would be lost through enforcement of the statute against the interests of the state that the statute was designed to protect. (Tri-Q, Inc. v. Sta-Hi Corp. (1965) 63 Cal.2d 199, 219-220 [45 Cal.Rptr. 878, 404 P.2d 486]; Macaulay, Justice Traynor and the Law of Contracts (1961) 13 Stan.L.Rev. 812, 828, fn.46 [“The new position [under Monarco] calls for a case-by-case definition of when reliance is ‘unconscionable’ and when enrichment is ‘unjust.’”].)
Nothing in the holding or the reasoning of Monarco, supra, 35 Cal.2d 621, suggests that the general equitable principles set forth therein were meant to be limited to any particular class of contracts or group of plaintiffs. Indeed, as this court wrote years earlier in Seymour v. Oelrichs (1909) 156 Cal. 782 at page 795 [106 P. 88]: “We can see no good reason for limiting the operation of this equitable doctrine to any particular class of contracts included within the statute of frauds, provided always the essential elements of an estoppel are present, or for saying otherwise than as is intimated by Mr. Pomeroy in the words already quoted, viz., that it applies *1273‘in every transaction where the statute is invoked.’ ” (See also Moore v. Day (1954) 123 Cal.App.2d 134, 138-139 [266 P.2d 51].) Although the doctrine of equitable estoppel has certainly expanded since Seymour v. Oelrichs was decided, nothing we have said or intimated since then has indicated an intent to reverse that holding or to prohibit use of the equitable doctrine in the context of any particular class of contracts within the statute of frauds.
Nevertheless, the notion has gained currency among the Courts of Appeal, partly in reliance on this court’s decision in Pacific etc. Dev. Corp. v. Western Pacific R. R. Co. (1956) 47 Cal.2d 62 [301 P.2d 825], and partly on the basis of the public policy underlying section 1624(d), that licensed real estate brokers are precluded as a matter of law from invoking equity to estop the assertion of section 1624(d). Neither settled law nor sound public policy supports this conclusion.
Since Monarco, supra, 35 Cal.2d 621 this court has considered a licensed broker’s suit on an oral employment contract in three cases. The first of these, Pacific etc. Dev. Corp. v. Western Pac. R. R. Co., supra, 47 Cal.2d 62, involved a broker’s suit for a 5 percent commission on an oral contract to procure an option to purchase certain land. Nelson, the broker, had engaged in negotiations with the defendant, the prospective buyer, over various propositions and offers that might be made for the purchase, but no final arrangements were made for Nelson’s employment or for the final terms of any offer. During the course of negotiations, Nelson left his employer, the Fortune Realty Company, to become an employee of plaintiff, the Pacific Southwest Realty Corp. Subsequent negotiations between Nelson, plaintiff’s president and defendant resulted in an offer of $2,500 per acre and $1,500 for the option, but the owner of the property declined the offer. One month later, without further call on Nelson or plaintiff, defendant purchased the property for $2,750 an acre and forwarded a check representing a 2 1/2 percent commission to Nelson’s former employer, Fortune Realty, with the understanding that half of the commission was to go to Nelson. Plaintiff thereupon sued defendant on an alleged oral agreement to pay it a 5 percent commission. The trial court entered judgment in favor of defendant on the ground that the agreement was not in writing as required by the statute of frauds.
We affirmed, holding, inter alia, that defendant was not estopped to plead the statute of frauds merely “by reason of the fact that [defendant] . . . finally concluded an option agreement with [the owner] for purchase of the property and the sale was subsequently consummated.” (47 Cal.2d at p. 70.) We further stated: “The fact that plaintiff rendered services and conducted unsuccessful negotiations with [the property owner] does not constitute a change of position to plaintiff’s detriment, nor does the fact that defendant *1274refused to pay plaintiff a real estate commission . . . constitute an unjust enrichment within the meaning of the estoppel doctrine. . . .[ft] Plaintiff is a licensed real estate broker and, as such, is presumed to know that contracts for real estate commissions are invalid and unenforceable unless put in writing and subscribed by the person to be charged.” (Ibid.)
The foregoing language from Pacific has been cited as the basis for a strict application of section 1624(d) (see, e.g. Jaffe v. Albertson Co. (1966) 243 Cal.App.2d 592, 605 [53 Cal.Rptr. 25]), and indeed, constitutes the principal authority in the majority opinion in support of that proposition (majority opn. ante at p. 1260). Such reliance is misplaced. Nothing in Pacific suggests that this court was announcing an ironclad rule of law prohibiting the use of equitable estoppel in any action by a licensed real estate broker on an oral contract. Rather, it is reasonably clear from the court’s extensive recitation of the facts in its discussion of estoppel, that the decision was based simply on the grounds that the facts did not establish an estoppel. (47 Cal.2d at pp. 70-71.) The equities in favor of the plaintiff brokerage firm were not compelling: it had entered the negotiations late and apparently had contributed little to what Nelson had already accomplished while employed by Fortune Realty; furthermore, as the court noted, “no option to purchase at $2,500 per acre was ever obtained,” and finally, there was no unjust enrichment, since defendant had paid a broker’s commission, albeit to the original parties, Nelson and Fortune Realty, rather than to the plaintiff. (47 Cal.2d at p.71.)
Since the 1956 decision in Pacific, this court has considered a broker’s suit on an oral contract in two cases, Beazell v. Schrader (1963) 59 Cal.2d 577 [30 Cal.Rptr. 534, 381 P.2d 390] and Franklin v. Hansen (1963) 59 Cal.2d 570 [30 Cal.Rptr. 530, 381 P.2d 386]. Although neither case involved an assertion of equitable estoppel, both cases clearly suggest that such a claim would not have been precluded. In Beazell, the plaintiff broker had actually received a 2 1/2 percent commission provided for in the escrow instructions but sued the seller for a 5 percent commission based on an oral agreement. We held that the broker was limited to the amount set forth in the escrow agreement by reason of the statute of frauds, but noted: “The complaint fails to charge defendant with any improprieties other than his failure to perform the oral contract.” (59 Cal.2d at p. 582.) Clearly, there would have been little point in noting that plaintiff had failed to allege a basis for equitable relief, if such relief were unavailable as a matter of law.
Similarly, in Franklin v. Hansen, supra, 59 Cal.2d 570, the plaintiff failed to allege estoppel, although unlike in Beazell the facts might have supported a claim of unconscionable injury, because plaintiff had clearly relied on an oral agreement to his serious detriment. However, as the Franklin court *1275noted, “Plaintiff herein has neither alleged nor urged the application of an equitable estoppel, pursuant to which doctrine a party to an oral agreement might be estopped to rely on the statute of frauds in instances where the elements of the doctrine can be established. (See Monarco v. Lo Greco, 35 Cal.2d 621, 626 [220 P.2d 737].)” (59 Cal.2d at pp. 576-577.) Again, by expressly noting that plaintiff had not alleged equitable estoppel, and by specifically citing Monarco in this context, the conclusion is fairly inescapable that we did not consider equitable relief from the statute of frauds to be foreclosed as a matter of law.
Notwithstanding the absence of any compelling legal authority, the majority opinion concludes that a rigid application of section 1624(d) is nevertheless compelled by reasons of public policy. Because of their training and experience, licensed brokers are presumed to know that contracts for real estate commissions must be in writing. (Pacific, supra, 47 Cal.2d at p. 70.) Section 1624(d) is thus designed to protect buyers and sellers of property from possible exploitation by licensed brokers asserting false claims for conmissions. (Pacific, supra, 47 Cal.2d at p. 70.)
I certainly have no quarrel with either of these propositions; the relative sophistication of the broker and the prophylactic purposes underlying the statute are undeniably relevant factors to be considered in balancing the respective equities in any given case. However, as this court has recently recognized in circumstances strikingly similar to those in the case at bar, the policies underlying the statute of frauds are not uniformly implicated in every case, and in any event such policies must be considered in light of the equitable interests of the plaintiff and the economic realities of the particular transaction. (See Asdourian v. Araj (1985) 38 Cal.3d 276, 292 [211 Cal.Rptr. 703, 696 P.2d 95].)
The majority opinion cites a number of consumer-oriented statutes to demonstrate the continued vitality of the statute of frauds in modem society. Among the statutes cited is Business and Professions Code section 7159, which provides that “home improvement” contracts between licensed contractors and property owners must be in writing and signed by all of the parties to the agreement. Violation of the statute constitutes a misdemean- or. In Asdourian v. Araj, supra, however, we held that even a contract which is illegal under this section may be enforced to avoid unjust enrichment or unconscionable injury. In that case, a licensed contractor brought an action against a property owner for work performed pursuant to an oral remodeling contract. Defendant asserted that the action was barred under Business and Professions Code section 7159. The trial court found in favor of the plaintiff and awarded damages for the reasonable value of the work performed.
*1276We affirmed. While acknowledging that courts generally will not enforce an illegal contract or one against public policy, we also noted that “ ‘the rule is not an inflexible one to be applied in its fullest rigor under any and all circumstances,’” and that in compelling cases “illegal contracts will be enforced in order to ‘avoid unjust enrichment to a defendant and a disproportionately harsh penalty upon the plaintiff.”’ (38 Cal.3d at pp. 291-292, quoting Southfield v. Barrett (1970) 13 Cal.App.3d 290, 294 [91 Cal.Rptr. 514].) “ ‘ “In each case, the extent of enforeceability and the kind of remedy granted depend upon a variety of factors, including the policy of the transgressed law, the kind of illegality and the particular facts.” ’ ” (Id. at p. 292, quoting South Tahoe Gas Co. v. Hofmann Land Improvement Co. (1972) 25 Cal.App.3d 750, 759 [102 Cal.Rptr. 286].)
Applying these principles in Asdourian, we found that the policy behind section 7159—to protect “unsophisticated consumers”—did not apply to the defendant, a relatively knowledgable real estate investor. (38 Cal.3d at p. 292.) We also noted that the parties “had had business dealings in the past,” that plaintiff had “fully performed according to the oral agreements” and that defendants had “accepted the benefits” of the agreements and would be unjustly enriched if allowed to retain such benefits without being required to compensate the plaintiff. (Id. at p. 293.) While conceding that, “[a]s a contractor, plaintiff should have been aware that the contracts were required to be in writing,” we nevertheless concluded: “The penalty which would result from the denial of relief would be disproportionately harsh in relation to the gravity of the violations.” (Id. at p.294.)
Thus, even where a licensed contractor brings suit on an illegal oral contract, we have recognized that the countervailing facts may be so compelling as to preclude the court or jury in good conscience from enforcing the statute. A fortiori, where the failure to execute a writing violates public policy but the contract is not otherwise illegal, I can perceive no reason to categorically deny equitable relief if the facts otherwise warrant it.
As Asdourian, supra, 38 Cal.3d 276, further demonstrates, the theoretical underpinnings of the statute of frauds cannot be viewed in isolation. Occasionally, as in Asdourian, the economic realities are such that the defendant is simply not a member of the class which the statute was designed to protect. This point has been stressed by a number of commentators critical of the view that equitable relief should not be extended to licensed real estate brokers. (See Comment, Equitable Estoppel and the Statute of Frauds in California (1965) 53 Cal.L.Rev. 590, 602, 609; Note, Oral Employment Contracts and Equitable Estoppel: The Real Estate Broker as Victim (1975) 26 Hastings L.J. 1503, 1524-1526; 1 Miller & Starr, Current Law of Cal. Real Estate (1975) § 1.54, pp. 69-74, fn. 8.) As we noted in Tenzer v. Super*1277scope, Inc. (1985) 39 Cal.3d 18, 28, fn. 6 [216 Cal.Rptr. 130, 702 P.2d 212], these critics have pointed out that “[i]n today’s market . . . brokers often deal with sophisticated principals in superior bargaining positions.” In such circumstances, the broker may be powerless to compel the principal’s cooperation in executing a written commission agreement, and the refusal to grant equitable relief from the statute of frauds may be unjust. (Ibid.) Indeed, as the record in the matter before us reveals, this was precisely such a case.
The majority opinion recites the facts well enough, but because of its conclusion that section 1624(d) precludes equitable relief as a matter of law, it ignores the story they tell. Defendant, Shapell Industries, Inc., is a publicly traded corporation engaged in the development of residential subdivisions and, as such, is continually engaged in the acquisition of land for that purpose. Although Shapell employed a well-trained staff to locate and acquire property (both Shapell and its vice president, Joseph Aaron, were licensed brokers), it relied to a large extent on outside brokers for leads. Because of its experience and expertise, however, Shapell generally used its own staff to negotiate the terms of sale directly with the property owners.
Shapell became acquainted with Phillippe, a licensed real estate broker, in 1972 when it purchased a 78-acre parcel of land on which Phillipe was the listing agent and paid Phillippe $153,100 for his services as broker. Thereafter, in January 1973, Shapell contacted Phillippe to engage his services in locating parcels in excess of 50 acres on the Palos Verdes Peninsula. Phillippe explained that he had no listings in that area and that his commission would have to be paid by Shapell as the buyer. Shapell agreed, orally promising to pay Phillippe a commission for any land submitted by him and purchased by Shapell, and also promising that his commission would be stated in any written offer made by Shapell to a seller.
Phillippe thereupon proceeded to familiarize himself with the Palos Verdes Peninsula, inspecting the area for vacant parcels, researching the land records and establishing contact with property owners and their representatives. In April 1973, Phillippe wrote to Shapell about a parcel of land owned by the Filiorum Corporation, stating in conformity with the master oral agreement his “understanding that Buyer will pay our firm a commission, which, when added to the net price of the land, will equal 6% of the total consideration.” Shapell responded in early May with an offer to purchase the Filiorum property that faithfully conformed to the oral agreement, stating as promised that the buyer, Shapell, agreed to pay a commission to Phillippe’s firm equal to 6 percent of the total consideration.
Although the Filiorum deal eventually fell through, Shapell asked Phillippe to continue his work on the Palos Verdes Peninsula. Several months *1278later, in August 1973, Phillippe wrote to Shapell again, informing the company of four additional properties which met Shapell’s requirements, including a ninety-four-acre parcel located in the City of Rolling Hills Estates belonging to Great Lakes Properties. As he had previously done pursuant to the general oral agreement, Phillippe restated in his letter the ongoing fee agreement, to wit, that the “properties [were] presented with the understanding that Buyer agrees to pay [Phillippe] ... a commission which when added to the net purchase price of the land will equal 6 percent of the total consideration . . . .” Phillippe received no written reply to the August letter.
The primary obstacle to the Great Lakes purchase proved to be not the asking price but the fact that the property was zoned for low density housing. Accordingly, Phillippe continued to work on the Great Lakes deal throughout 1973 and early 1974, meeting or talking on a regular basis with representatives of Shapell, the planning and zoning department of the City of Rolling Hills and the owner of the property. Phillippe’s contact at Shapell during this period was Bill Snow, vice president of land acquisitions. Snow testified that in one of his early meetings with Phillippe the latter had reminded him that he had no listing with the seller and expected to receive payment from Shapell; Snow recalled that he told Phillippe such payment was “not a problem as long as the deal [was] otherwise satisfactory.” He recalled: “We occasionally pa[id] the broker’s commission, the buyer did . . . if a broker brought a good piece of land to me and I ended up buying it, I saw to it that he got compensated.” It was Snow’s specific understanding that “there was an agreement to pay [a\ commission [to Phillippe] if we bought the property.”
Phillippe continued his efforts to facilitate a sale during the early months of 1974. In January, he met with the representative of the property owner and obtained a copy of an engineering study showing the feasability of a higher density project, which he passed on to Shapell together with a cover letter updating Shapell as to the current status of negotiations and progress before the planning commission. Phillippe continued to monitor the planning commission and in February informed Shapell of the commission’s decision to grant the rezoning. In April, Ron Prince, an employee of Shapell, called Phillippe for an update on the property and mentioned that the project was being turned over to Joseph Aaron, a vice president of Shapell and a licensed broker himself. In a letter dated April 22, 1974, addressed to Mike Steponovich, vice president of Great Lakes Properties, Phillippe stressed that Shapell was interested in the purchase and “ha[d] the full capability to close the escrow.” The letter closed as follows: “You may want to remind Joe Aaron that we have been working with you at the request of *1279Shapell over a period of time.” The letter indicated that a courtesy copy was being sent to “Ron Prince - Shapell Industries.”
In late April, Phillippe phoned Aaron to explain what had transpired in the negotiations thus far. In a followup letter addressed to Aaron and dated April 30, 1984, Phillippe reviewed the prior negotiations concerning the Great Lakes property and reminded him of the commission agreement, stating; “The commission arrangement on these properties between our firm and Shapell is spelled out in the August 9, 1973, letter [to Prince].”
Several subsequent attempts by Phillippe to discuss the sale with Aaron were rebuffed. Shapell eventually purchased the Great Lakes property in August 1976; the offer did not provide for any commission to Phillippe.
The story that emerges from these facts may be summarized as follows: Shapell, a major firm engaged in the acquisition and development of real property, contacted Phillippe, the proprietor of a small brokerage firm; Shapell engaged Phillippe to locate properties on the Palos Verdes Peninsula pursuant to a general oral agreement to pay a commission for any property that Phillippe located and Shapell purchased; in reliance on the agreement, Phillippe engaged in a concentrated effort to locate properties in the area with Shapell’s full knowledge and implied encouragement; although no purchase resulted from Phillippe’s locating the Filiorum property, Shapell did, as promised, provide in its offer for a 6 percent commission to be paid to Phillippe; thereafter, Shapell reaffirmed its desire for Phillippe to continue his efforts to locate properties and, through its employee Bill Snow, reconfirmed the master oral agreement to pay a commission with respect to the Great Lakes property; in reliance thereon, Phillippe continued to work on facilitating the Great Lakes deal, meeting or talking regularly with representatives of the city, the property owner and Shapell; Shapell employees were kept informed of and encouraged Phillippe’s efforts to facilitate its purchase of the Great Lakes property; Phillippe, both orally and in writing, frequently reminded Shapell of the terms of the oral commission agreement, yet Shapell never once demurred to Phillippe’s repeated affirmations of the oral commission agreement until shortly before the Great Lakes purchase was consummated.
It is difficult to conceive a more suitable occasion for the assertion of equitable estoppel. Clearly, both tests of estoppel, unconscionable injury and unjust enrichment, are present. The principal, Shapell, initiated the contact with Phillippe and not only induced reliance, but continually monitored and encouraged his performance. Furthermore, Shapell reaffirmed its original commitment to the general oral agreement, first in writing (in connection with the Filiorum deal), then orally (in connection with the *1280Great Lakes property) and finally through silent acquiescence as Phillippe labored and periodically sought confirmation of the oral understanding. Under the circumstances, failure to enforce the contract would clearly result in unconscionable injury.
It is true that Phillippe, as a licensed broker, must be presumed to have been aware of the requirement of a written contract. As we recognized in Asdourian, however, such presumed knowledge merits far less consideration when the principal, as here, is not only as sophisticated as the broker, but exercises even greater economic leverage. In this factual context, enforcement of the oral contract does not impair the policy of the statute. (Asdourian v. Araj, supra, 38 Cal.3d at pp. 292-294.)
Moreover, it is clear that Phillippe fully performed according to the oral agreement, and that Shapell richly profited from that performance. Under the circumstances, if Shapell is allowed to retain the benefits of Phillippe’s performance without paying the agreed upon commission, Shapell will be unjustly enriched. (Monarco v. Lo Greco, supra, 35 Cal.2d at pp. 623-634; Asdourian v. Araj, supra, 38 Cal.3d at p. 293.)
As I stated in the beginning, it is axiomatic that the statute of frauds “is for the prevention, not in aid of the perpetration, of fraud. It is to be used as a shield, not as a sword.” (Colin v. Tosetti, supra, 14 Cal.App.at p.695, italics supplied.) The holding of the majority opinion inverts this principle, wielding the statute as a sword in the name of “public policy” to condone an obvious injustice. As the facts in this case demonstrate, however, public policy is not seriously implicated and “would not be effectively served by allowing such an inequity.” (Asdourian v. Araj, supra, 38 Cal.3d at p. 294.) Accordingly, I would affirm the judgment.
Broussard, J., concurred.