A listing agreement in Alberta expires on December 31st at 11:59 PM. An offer is presented at 11:45 PM on December 31st but is not accepted until 12:30 AM on January 1st. What is the commission entitlement?

Q: What is the correct answer to: A listing agreement in Alberta expires on December 31st at 11:59 PM. An offer is presented at 11:45 PM on December 31st but is not accepted until 12:30 AM on January 1st. What is the commission entitlement?

The correct answer is No commission is owed as acceptance occurred after expiry. Option B is correct because under Alberta's Real Estate Act and RESA regulations, a listing agreement's expiry terminates the agent's authority to act for the seller. Commission entitlement is typically triggered by acceptance of an offer, not mere presentation. Since acceptance occurred at 12:30 AM on January 1st, after the December 31st expiry, the agent had no valid authority and therefore no automatic commission entitlement. The agency relationship had legally terminated, making any subsequent acceptance outside the scope of the original listing agreement.

Q: What background knowledge is needed for this Contracts & Agreements question?

Under Alberta's Real Estate Act and RESA regulations, listing agreements create agency relationships with specific terms including expiry dates. The agent's authority to act for the seller terminates upon expiry unless renewed or extended. Commission entitlement typically arises when an offer is accepted during the valid listing period, creating a binding purchase contract. Key timing elements include when offers are presented, when they're accepted, and whether both occur within the listing period. Holdover provisions may extend certain rights beyond expiry for specific circumstances, but these don't automatically apply to all situations.

Q: What is a good way to remember the answer to this Contracts & Agreements question?

Like Cinderella's carriage turning back into a pumpkin at midnight, a listing agreement's magic (authority and commission rights) disappears at expiry. If the 'prince' (buyer) doesn't accept the 'glass slipper' (offer) before the clock strikes twelve (expiry), the 'fairy godmother' (agent) loses her powers and gets no reward. When you see timing questions about listing expiry, think 'Cinderella Rule' - did the acceptance happen before or after the midnight expiry? If after, the magic is gone and no commission is owed.

Q: What exam tip applies to this Contracts & Agreements question?

Focus on when acceptance occurs, not when the offer is presented. If acceptance happens after listing expiry, no commission is owed unless specific holdover provisions apply. Always check the exact timing of acceptance versus expiry.

Q: How does this Contracts & Agreements concept apply in real world practice?

An agent lists a property with a December 31st expiry. On December 31st at 11:45 PM, they present a strong offer to the sellers who are traveling. The sellers can't be reached until the next morning and accept at 12:30 AM January 1st. Despite the agent's hard work and the offer being presented during the listing period, they have no automatic right to commission since acceptance occurred after expiry. The agent would need to negotiate a new agreement or rely on any applicable holdover provisions.

Question

Contracts & AgreementsListing AgreementsABHARD

A listing agreement in Alberta expires on December 31st at 11:59 PM. An offer is presented at 11:45 PM on December 31st but is not accepted until 12:30 AM on January 1st. What is the commission entitlement?

Answer Options

A

Full commission is owed as the offer was presented during the listing period

B

No commission is owed as acceptance occurred after expiry

C

Half commission is owed due to the timing circumstances

D

Commission is owed only if specifically negotiated in a new agreement