I recently sold my home, or thought I did. Using a realtor, an offer was accepted and a waiver signed on last day of conditional sale. 3 weeks later the purchaser backed out, claiming he was pushed into the sale by his agent. My question is not regarding the purchaser, but the commission of the pending sale. Although there was a contract and the purchaser is in breach of the contract, am I responsible for paying commission to my agent on the sale that never closed?

Hello grusha:

Well, I'm not Canadian, but I think Canadians are pretty smart. So I would think Canadian law would say that one shouldn't earn a commission on an almost sale.

If I earned commissions on all the sales I almost had, I'd be a wealthy dude today.

excon

PS> By the way, what does the listing contract say? If it says that you're going to pay if they ALMOST do their job, and YOU signed it, shame on you.

I recently sold my home, or thought I did. Using a realtor, an offer was accepted and a waiver signed on last day of conditional sale. 3 weeks later the purchaser backed out, claiming he was pushed into the sale by his agent. my question is not regarding the purchaser, but the commission of the pending sale. Although there was a contract and the purchaser is in breach of the contract, am I responsible for paying commission to my agent on the sale that never closed?
Unfortuantely I do not have the contract in front of me, but when I was reading the pages and pages of fine print yesterday, I did not come across anything that would answer my question. I would agree with your statement and that is why I never thought about it, until I got a call from the realtor who said he would consider waving his fee if I can not re-coup costs for damages through the courts. I now own 2 houses (1st purchaser backed out 20 days before closing) and am going through small claims court to recover about 80% of damages, but if I have to pay commission (we are talking thousands) that 80% will dwindle to nothing and I may still be more out of pocket.

Hello again, grusha:

The cool thing about your situation is that there isn't going to be any closing where the escrow agent hands out commission checks.

Therefore, any money he gets from you is going to be given to him or sued for. I wouldn't give him any, and in my view, he can't win any.

Even if YOU win damages from the non-buyer (which you are indeed, entitled to), a SALE was NOT consummated. This realtor is off the wall. You can tell him so, or ignore him - your choice.

excon

Thank-you for your reply. I have reviewed the listing agreement and if I interpret the langugage correctly, I believe I am only liable for a default in contract if I was the cause of the break of the contact.

Should you be interested in reviewing the contract I can send it to you directly

I agree, that sounds like a standard clause. Your realtor might have a cause of action against the buyer, but not against you. All he seems to have accomplished would be getting you to go to another agent to sell the house.

One other point here. Aren't you getting a binder payment upon going to contract? This binder should cover most of the costs if the buyer defaults.

Your terminology is different than that used in Canada. I am guessing you mean the purchaser's deposit? If so, yes, they did put $3K down. That is very little considering the house sold for $303K. I did not like it from the start, but with resale homes, this is standard. At the moment the $3K is in trust and only a judge can release it to me, but I have to go to court. The house did sell again using the same agent. Only reason I used same agent was in case I needed him for court later. I believe the purchasers are now suing their agent. What a mess!

1% as a binder seems awfully low. In the US 5% is the usual amount.