Enable button when scroll bootstrap modal to bottom

your modal-body need the scroll event, and you need a small change to the if:-

$('.modal-body').scroll(function () {
    if ($('#agreement').height() == ($(this).scrollTop() + $(this).height())) {         
        $('#closeBtn').removeAttr('disabled');
    }
});

working snippet below (updated to toggle on/off)

$('.modal-body').scroll(function() {
  var disable = $('#agreement').height() != ($(this).scrollTop() + $(this).height());
  $('#closeBtn').prop('disabled', disable);
});
.btn-group {
  z-index: 1051;
}
.modal-body {
  height: 300px;
  overflow: auto
}
<link href="http://cdnjs.cloudflare.com/ajax/libs/twitter-bootstrap/2.3.1/css/bootstrap.css" rel="stylesheet" />
<script src="https://ajax.googleapis.com/ajax/libs/jquery/2.1.1/jquery.min.js"></script>
<script src="http://cdnjs.cloudflare.com/ajax/libs/twitter-bootstrap/2.3.1/js/bootstrap.min.js"></script>

<div class="container">

  <h3>User Agreement</h3>

  <!-- Button to trigger modal -->
  <div>
    <a href="#myModal1" role="button" class="btn" data-toggle="modal">Launch Modal</a>
  </div>

  <!-- Modal -->
  <div id="myModal1" class="modal hide" tabindex="-1" role="dialog">
    <div class="modal-header">
      <button type="button" class="close" data-dismiss="modal" aria-hidden="true">×</button>
      <h3>User Agreement</h3>
    </div>
    <div class="modal-body">

      <div id="agreement" style="height:1000px;">
        A very long agreement
      </div>

    </div>
    <div class="modal-footer">
      <button id="closeBtn" class="btn btn-primary" data-dismiss="modal" aria-hidden="true" disabled>I Accept</button>
    </div>
  </div>

</div>