In late 2014 the Property, Stock and Business Agents Regulation 2014 came into effect. There were several changes introduced as part of the update to the regulations and one of the changes introduced was in regards to agency agreements.
Under clause 8, section 3 of the regulations it is stated that on and from 1 March 2015, if the agency agreement includes a term that a commission is payable even if the sale of the property is not completed, the agency agreement must include a warning notice.
The notice must be in the form of:
“WARNING: The term immediately above provides that a commission is payable under this agreement even if the sale of the property is not completed.”
This notice must be included in the agency agreement immediately following the commission term and must be no less prominent than the commission term.
Sample clause from the updated EAC Sales Inspection and Exclusive Selling Agency Agreement.
The change applies to agency agreements for the sale of residential (including land) and rural property and Businesses. We have updated our printed and electronic forms to include this change and they are now available for purchase and use on-line.
To ensure compliance I recommend that you check if the agency agreements being used for the sale of the property types outlined above include a term that a commission is payable even if the sale of the property is not completed and if so that the warning notice is also included.
