When selling your property in most circumstances you will engage the services of a Real Estate Agency to manage the sale process. They will advertise the property, draft the Contract of Sale, liaise with buyers and organize an auction if you choose.
When listing your property with an Agency you can either list it with them and other Agencies, or enter into an Exclusive Agency Agreement with the one Agency. Entering into an Exclusive Agreement often has many benefits as Agents know that they will be receiving 100% of the commission if they manage to sell the property and will often offer a better rate and include extra advertising free.
It’s important though that you are aware of your legal obligations when entering into such an Agreement. Not only will you not be allowed to have any other Agency advertise or sell the property, but you will also bound by a Contract and must terminate it formally following its conclusion.
In a recent case a couple had listed their property with an Agency in an Exclusive Agency Agreement. The Agency failed to sell the property and after the Agreement expired after 3 months they couple listed the property with a different Agency who promptly sold the property.
Unfortunately the couple had just presumed that their Agreement with the first Agency automatically expired after the initial period and they made no request to them to terminate it at this time. Because of this the couple were legally obliged to pay commission to both the original Agency who failed to sell the property and the second Agency.
Due to their failure to terminate the Agreement with the first Agency they were still bound by it and were left out of pocket after paying two lots of commission.
Your lawyer can ensure you don’t end up in this situation by reviewing an Agreement before you enter into it with an Agency.