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Listing or Commission Agreements
Provisions Not Related to the Commission
The property that will be subject to the listing or commission
agreement should be clearly described. A legal description is
best because it removes all ambiguity but if a legal description is
not available then the property that will be subject to the listing
or commission agreement must be described as clearly as
possible to avoid potential problems and conflict. Street
addresses and unit numbers can help eliminate confusion but
common names of areas or properties and ambiguous
descriptions of the property should be avoided because such
non-precise names or terms may have different meanings to
different people which can introduce uncertainty and discord
into the transaction as well as the relationship of the parties.
The listing or commission agreement should also clearly
describe the type of transaction that will result in a commission
being earned by the broker. Some listing or commission
agreements contemplate only a sale of the subject property. If
the broker identifies a potential tenant then such a transaction
will not fall within the terms of the listing or commission
agreement, though the broker in such a case may have a claim
to a commission based upon the procuring cause theory. While
such a point seems obvious, owner expectations, inclinations,
and intentions can change over time, especially if a suitable
buyer is not identified after an extensive period of time. In such
a case, the owner may decide to broaden their potential deal
partners by expanding the types of transactions they would
agree to undertake in which event the applicable listing or
commission agreement that only contemplates a purchase and
sale should be amended or supplemented to also contemplate
Return to Listing or Commission Agreements
Law Office of
Craig W. Little, P.A.