AN ESTATE AGENT’S CLAIM FOR PAYMENT OF COMMISSION, PARTIAL COMMISSION, DAMAGES, PENALTIES AND A QUANTUM MERUIT

Abstract

Estate agents often become engaged in disputes regarding remuneration, and their legal representatives need to have a clear understanding of the remedies that are available in the circumstances and the different causes of action that can form the
basis of a claim. The traditional claim is one for payment of commission, based on common law, on the grounds that the estate had performed the mandate. This requires proof that the estate agent was the effective cause of the transaction contemplated by
the mandator. A commission claim may also be based on a stipulatio alteri contained in a sale agreement negotiated by an estate agent, in which event only the terms of the stipulatio (express or implied) need to be established. The stipulatio may be worded to the effect that commission would be payable regardless of whether or not the estate agent was the effective cause of the sale. In certain instances the claim would be a claim for damages, not commission, requiring proof of the damages suffered. Claims for the enforcement of a penalty clause are subject to the Conventional Penalties Act 15 of 1962. A claim based on enrichment is a possibility in certain, rare instances. Generally an estate agent’s claim would be a claim for the full commission (or damages in lieu of commission), but a claim for payment of a portion of the commission is nevertheless possible in certain instances.