Real Estate Sales Contract and Commissions

In a Jamaica real estate transaction, the brokers andsale. This is true because performance is the essence
salespersons can assist the owner or principal withof a broker's contract with a principal. A broker's legal
understanding the sales contracts.claims to compensation are based on employment
A sales contract is a bilateral contract since itand performance.
contains promises to perform by both parties. AllIn instances involving open listings where several
sales contracts must identify the property affected;brokers have buyers for the same Jamaica property,
therefore, a complete legal description must bethe owner-principal must take care to ensure that he
included in the contract.or she does not become liable for two commissions.
The following information also must be in theIn some cases, competition among buyers causes
contract: the name of the parties to the contract,would-be purchasers to offer higher prices than the
the vendor and the vendee a valuable consideration;owner has asked. In this event, the first broker who
the total purchase price; any terms that have beenproduces a buyer ready, willing and able to meet the
agreed to; any arrangements for financing theterms of the open listing is entitled to a commission,
purchase: the closing date; remedies for breach byregardless of whether the owner accepts or rejects
either parties; or all agreements reached betweenthe offer. If the owner refuses the first offer that
the two parties. It is also a good idea to indicate thatmeets the seller's terms and accepts a second
the time allowed for acceptance of the offer and thebroker's contract for a higher price, then the owner
time allowed for performance, followed by time is ofis obligated to pay two commissions.
the essence.When a Jamaica real estate broker has been the
Be certain that the sales contract specifies a dateprocuring cause of a real estate sale, the broker's
and time for transfer of ownership responsibilities andactions have led directly to the sale. The courts
expenses. If no meeting of the minds is indicatedusually rule that a broker is considered to have
regarding this issue, the licensee (or his employer)performed the contract of employment if his or her
may be held responsible should the transaction not beefforts are the procuring cause of a transaction.
concluded later. This is vital during the sale of JamaicaSometimes two or more brokers will claim to be
beach front homes.entitled to compensation as a result of a single sale.
When is the vendor or principal obligated to pay twoIt is not enough that broker may have shown the
commissions:property first or that a broker may have submitted
It is entirely possible that the actions of a principal;the binding offer.
may obligate him or her to pay a commission toTo be declared the procuring cause, it is must be
more than one broker. For example, if the principaldefinitely established that a broker's effort were
had previously given an exclusive-right-of sale listingdirectly responsible for the buyer's decision to acquire
to broker A and then learnt of broker's B'sthe property. Or is another situation, a broker may
negotiations with an interested buyer and consentedshow a property to a prospect who thereafter
to the actions of broker B, who then concluded aleaves the broker and negotiates directly with the
sale, the principal would be obligated to pay aseller. If a sale results the broker is entitled to a
commission not only to broker A because of thecommission as the procuring cause of the sale of
terms of the exclusive-right-of sale listing contractproperties such as Jamaica long beach properties.
but also to broker B because of an implied listing and