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ARTICLE · 27 MAY 2015

When is a real estate agent really entitled to commission?

The exclusive agency period may be expired, but an agent may claim commission if he was the effective cause of the sale.

AustraliaReal Estate and Construction

It is not uncommon for an agent to attempt to claim commission from a vendor for having introduced the purchaser to the property even though the purchaser had ultimately signed a contract through a different agent after the initial agent's exclusive agency period.

Often in a contract for sale of property, the vendor will insist on a warranty from the purchaser that the purchaser was not introduced to the property by any agent other than the agent named on the front page of the contract, as well as an indemnity for any breach of the warranty. The vendor in such circumstances is attempting to avoid being out of pocket in paying another agent commission should another agent successfully claim commission for introducing the ultimate purchaser to the vendor or property.

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