This is the Referral of Enquiries paragraph:
“5. REFERRAL OF ENQUIRIES: The Seller agrees that during the Listing Period, the Seller shall advise the Listing Brokerage immediately of all enquiries from any source whatsoever, and all offers to purchase submitted to the Seller shall be immediately submitted to the Listing Brokerage before the Seller accepts or rejects the same. If any enquiry during the Listing Period results in the Seller accepting a valid offer to purchase during the Listing Period or within the Holdover Period after the expiration of the Listing Period, the Seller agrees to pay the Listing Brokerage the amount of Commission set out above, payable within five (5) days following the Listing Brokerage’s written demand therefor.”
Review
Set out below and marked in bold and italics are those words that are inserted by me to assist in the review. They are not set out in the clause itself. Let’s look at that paragraph in a little more detail:
“5. REFERRAL OF ENQUIRIES:
When
The Seller agrees that during the Listing Period,
Referral to Listing Brokerage
the Seller shall advise the Listing Brokerage immediately of all enquiries
From Whom
from any source whatsoever, and
Offers Immediately
all offers to purchase submitted to the Seller shall be immediately submitted to the Listing Brokerage
Prior to Acceptance
before the Seller accepts or rejects the same.
Any APS: Commission Payable
If any enquiry during the Listing Period results in the Seller accepting a valid offer to purchase
- during the Listing Period or
- within the Holdover Period after the expiration of the Listing Period,
the Seller agrees to pay the Listing Brokerage the amount of Commission set out above,
Due on Demand
payable within five (5) days following the Listing Brokerage’s written demand therefor.”
COMMENT
This provision is intended to ensure that the Seller will not try to avoid the Listing Agreement. If they fail to refer the person or the Offer to the Listing agent, then, that person would still fall within the “introduced to the property” provisions during the Listing period.
Here, the possible breach is noted and the Seller’s obligation is to pay the commission within 5 days of the DEMAND for payment. That’s interesting since other provisions set the time as due on the completion date. Here, we could be still three months prior to completion. The assumption in this paragraph is that completion has already taken place. Hence, the demand!
Brian Madigan LL.B., Broker