Author: Aiesha Isaacs
If you have decided to sell your property and have found whom you consider as a favourable fit when it comes to a real estate agent, the next thing to consider would be the terms of the agency agreement. Before you sign, some considerations should be made.
Agency agreements are often termed as exclusive in that you are bound to engage the agent’s name in the agreement exclusively for a particular period of time. An exclusive agency agreement would entitle the said agent to be paid their commission regardless of whether the purchaser was introduced by you or anyone other than the agent. This type of agreement is usually referred to as the agent having sole mandate to sell your property.
Non-exclusive agency agreements therefore allow you to appoint more than one agent at any one time during the sale of your property and the agent who effects the sale will be entitled to the commission thereof.
Ordinarily, agency agreements will provide for a particular period of time. Once that time has lapsed, the agreement will then continue as a non-exclusive agreement until the property is sold, or the agreement is terminated.
Should the agency period exceed ninety (90) days, the seller can terminate the agreement by providing thirty (30) days written notice to the agent at the end of the ninety (90) day period. Once the agreement is terminated, the agent is required to stop marketing the property but will still have the option to claim a commission if they caused the sale of the property.
Just as any person is entitled to file a lawsuit against another, a real estate agent has the right to institute legal proceedings against you, whether you are their client or another party to a sale. This is usually done because they feel a commission has been incorrectly withheld or over a breach of contract.
Important to note, unless otherwise agreed, an agent is not entitled to commission by merely introducing a potential purchaser who concludes a binding contract. The agent must be the effective cause of the sale which means that it must have been due to the agent’s efforts that the purchaser ended up purchasing the property. At Velile Tinto Cape Incorporated we pride ourselves in our excellent client service and good relations with our estate agents. Should you require more information regarding this article or seek legal advice regarding same, kindly contact our offices where our team of property law experts will be more than willing to advise you on same.