Buyer Defrauded Estate Agent of Commission
Tuesday 15 March 2011
When the buyer is an accomplice to the fraudulent privation of the commission due to the estate agent, they are also liable for the damages payable.
That was the decision of the French Supreme Court (Cour de Cassation) in a recent case that came before them.
In the case, the estate agents SARL Tolosan Immobilier had been instructed by the sellers on the sale of their property, for which they had a formal written contract (mandat de vente) .
Although the contract had been terminated by the seller, the terms still required they pay the agent’s commission for potential buyers introduced to them up the end of the contract period.
Indeed, the commission continued to be payable for a period of 18 months for any clients who had been introduced to the seller up to expiration of the contract.
By dealing directly with a buyer introduced by the agent during this period, the court decided that the seller had committed a breach of contract.
The commission payment due under the contract was €15,400, and as the court considered that this sum was not excessive and reasonably justified, it was due by the seller.
However, the court went further, by examining the responsibility of the buyer in the matter.
They had dealt with the seller directly less than two months after having been introduced to the property by the agent.
The sale price agreed between the buyer and seller was €230,000, some €10,000 less than a previous offer made by the purchaser through the aupices of the agent.
The court ruled that the buyer could not escape their own responsibility for the commission by arguing that they were not party to the contract between the seller and the agent, for they signed a ‘bon de visite’ which bound the buyer to deal irrevocably with the agent in their dealings with the seller.
On this basis the buyer was equally complicit with the seller in defrauding the agent of their commission.
As a result, the court decided that the buyer was concurrently liable with the seller for the payment of damages.
This article was featured in our Newsletter dated 15/03/2011