Sole agreement clause - Private sale

pkmt22

I recently put my bungalow on the market with a well-known estate agent, one day after the cooling off period ended, my father in law suggested that he would like to buy our property (smaller, easier to maintain, cheaper to run etc). 

The clause in the sole agreement contract states ' you agree to pay our fee in the event you exchange privately within 2 years of terminating this contract – this is if you exchange with a purchaser we have introduced via our marketing' - I know this one will not apply to us. 

But the second part states 'In the event you exchange contracts privately with a purchaser we have not introduced and was introduced after the agreement expires (15 weeks) you agree to supply us with their name and address' 

So, am I right in thinking that as long as we don’t go ahead and sell to my father in law for 15 weeks, we will not be expected to pay? Can they say he was an interested party prior to the agreement ending because he is a relative, even though he never viewed it or offered on it via them? It was never discussed until now, we can just sit on it for 15 weeks until the agreement expires?

DE_612183

Not sure why you would need to divulge his name and address - maybe before GDPR but not sure thats allowed now...

Albermarle

DE_612183 said:

Not sure why you would need to divulge his name and address - maybe before GDPR but not sure thats allowed now...

I presume the EA wants the name and address, so they can check it is not someone introduced by them.
Whether the info should be supplied or not, is another matter.

eddddy

Does the contract use the term "Sole Selling Rights" or "Sole Agency"?  Both those terms have legal definitions.


For example, if it's a "Sole Selling Rights" contract, there should be a term saying something like:

You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, in each of the following circumstances:

• if [unconditional contracts for the sale of the property are exchanged] after the expiry of the period during which we have sole selling rights but to a purchaser who was introduced to you during that period ...

In that case, you would have to argue that your father-in-law wasn't introduced to the idea of buying your property during the estate agent's Sole Selling Rights contract period.

i.e. You had already introduced him to the idea of buying before instructing the estate agent. Or you didn't introduce him to the idea of buying until after the estate agent's contract had ended.



But if it's a "Sole Agency" contract, you won't have that problem. (That would only be a problem if another estate agent introduced your father-in-law - which clearly isn't the case.)

pkmt22

eddddy said:

Does the contract use the term "Sole Selling Rights" or "Sole Agency"?  Both those terms have legal definitions.


For example, if it's a "Sole Selling Rights" contract, there should be a term saying something like:

You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, in each of the following circumstances:

• if [unconditional contracts for the sale of the property are exchanged] after the expiry of the period during which we have sole selling rights but to a purchaser who was introduced to you during that period ...

In that case, you would have to argue that your father-in-law wasn't introduced to the idea of buying your property during the estate agent's Sole Selling Rights contract period.

i.e. You had already introduced him to the idea of buying before instructing the estate agent. Or you didn't introduce him to the idea of buying until after the estate agent's contract had ended.



But if it's a "Sole Agency" contract, you won't have that problem. (That would only be a problem if another estate agent introduced your father-in-law - which clearly isn't the case.)

Hi Eddddy 

The paperwork states on the front 'Sole Agency Agreement' 

It says 'You agree to pay our fee in the event that you exchange contracts privately within 2 years of terminating this agreement, with a purchaser we have introduced as a result of any of our marketing methods, inc website adverts, wither or not a viewing results or to any party with whom we have had negotiations about the property.  In the event that you exchange contracts privately with a purchaser we have not introduced after this agreement expired, you agree to supply us with the name and address of the purchaser.  If you already have interested parties introduced privately, please list them below - we left this blank. 

pkmt22

Albermarle said:

DE_612183 said:

Not sure why you would need to divulge his name and address - maybe before GDPR but not sure thats allowed now...

I presume the EA wants the name and address, so they can check it is not someone introduced by them.
Whether the info should be supplied or not, is another matter.

And technically my FIL wouldn't be someone introduced by them, so as long as we do this after the 15 week agreement ends, we wouldn't be breaching anything would we?

user1977

The buyer’s name and address will be publicly available as soon as they register the purchase, so not sure there’s much point being precious about confidentiality during what will probably be a matter of a few days.

propertyrental

It reads like a sole agency contract.

'You agree to pay our fee in the event that you exchange contracts privately within 2 years of terminating this agreement, with a purchaser we have introduced as a result of any of our marketing methods

But why

'In the event you exchange contracts privately with a purchaser we have not introduced and was introduced after the agreement expires (15 weeks) you agree to supply us with their name and address'

If the purchaser was introduced after the agreement expires, by the OP or another agent, I can't see how the agent could claim a fee or why they'd need the name/address.

eddddy

pkmt22 said:

The paperwork states on the front 'Sole Agency Agreement' 

OK - so you're probably safe then.

The legal definition of "Sale Agency" is:

“SOLE AGENCY

You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, if at any time [unconditional contracts for the sale of the property are exchanged] —

• with a purchaser introduced by us during the period of our sole agency or with whom we had negotiations about the property during that period; or

• with a purchaser introduced by another agent during that period.”

Link: https://www.legislation.gov.uk/uksi/1991/859/schedule/made

 And, presumably, none of that applies to your father-in-law.



FWIW, even though your estate agent isn't using the prescribed definition of "Sole Agency" (which is a breach of the regulations), their contract doesn't make you liable for their fees in this case...

pkmt22 said:

...we have introduced as a result of any of our marketing methods, inc website adverts, wither or not a viewing results or to any party with whom we have had negotiations about the property.  

i.e. Your father-in-law wasn't introduced by them (as a result of any their marketing methods or otherwise).

pkmt22

eddddy said:

pkmt22 said:

The paperwork states on the front 'Sole Agency Agreement' 

OK - so you're probably safe then.

The legal definition of "Sale Agency" is:

“SOLE AGENCY

You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, if at any time [unconditional contracts for the sale of the property are exchanged] —

• with a purchaser introduced by us during the period of our sole agency or with whom we had negotiations about the property during that period; or

• with a purchaser introduced by another agent during that period.”

Link:

 And, presumably, none of that applies to your father-in-law.



FWIW, even though your estate agent isn't using the prescribed definition of "Sole Agency" (which is a breach of the regulations), their contract doesn't make you liable for their fees in this case...

pkmt22 said:

...we have introduced as a result of any of our marketing methods, inc website adverts, wither or not a viewing results or to any party with whom we have had negotiations about the property.  

i.e. Your father-in-law wasn't introduced by them (as a result of any their marketing methods or otherwise).

Thanks so much, this has really helped.