By Natalie Smyth
When it comes to selling residential property in Queensland, most people will engage the services of a real estate to assist them with marketing the property and introducing prospective buyers to the property.
The contractual relationship between the seller and the real estate agent with respect to the agent’s fees and commission for marketing and selling the property is formalised by way of a Property Occupations Form 6 Appointment and reappointment of a property agent, resident letting agent or property auctioneer.
Many Sellers do not obtain legal advice regarding the Form 6 and as a result are uncertain on when commission will and won’t be payable to the real estate agent who has been appointed by them by way of the Form 6.
Don’t get caught out paying Double Commission when Selling residential property in Queensland
Term of Appointment
Sellers can appoint the agent for a single appointment for a particular service or services, or for a continuing appointment. A single appointment will specify the start and end date for the appointment, whereas a continuing appointment will specify a start date but will be continuing until the service is provided, or in most cases, the sale is complete.
Type of agency
The type of agency the Seller selects in the form 6 will have a bearing on when the Seller will be required to pay the appointed agent commission. For example, should the Seller appoint the agent “exclusively”, the Seller must pay the agent commission whether or not the agent, a different agent, or any other person sells the property during the term of the appointment. For example, If the Seller has also appointed a different real estate agent who is the effective cause of the sale, the Seller may be liable to pay commission twice, being once to the agent who was the effective cause of the sale, and twice, to the other agent who was appointed exclusively by the Seller.
REIQ terms of appointment
Annexed to a Form 6 is an REIQ Appointment of Real Estate Agency form, which contains Essential Terms and Conditions regarding the appointment. We have identified that these terms, which are often overlooked by Sellers, make provisions for when commission will be paid to an agent after the Contract for Sale is signed by the Seller and the Buyer.
If you are selling a property in Queensland, we recommend that you obtain independent legal advice from our property and commercial solicitor Natalie Smyth prior to signing a Form 6 and an REIQ Appointment of Real Estate Agent form. Failure to obtain legal advice prior to signing these documents may result in you having to pay double commission to an agent, or being liable to pay commission when a Contract of sale is terminated by no fault on your part.
We also recommend that you seek pre contract advice from our team at Just Us Lawyers prior to signing any Contract for the Sale and Purchase of residential or commercial property in Queensland.
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