A homeowner signs a sole agency agreement, then sells the house to a neighbour she found herself, with no agent involved. Is commission payable under the sole agency?
Correct Answer
D) No, because under a sole agency the owner may find her own buyer
The Act and Regulation define a sole agency agreement as one where the agent earns commission whether or not the agent is the effective cause, unless the client is the effective cause. An exclusive agency pays commission even if the client sells. NSW Fair Trading summarises: under a sole agency, if you find a buyer not introduced by the agent, no commission is payable.
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