Question:
Holdovers, do they really protect us? Sellers were under contract and backed out of a conditional deal they didn’t want to agree to terms of the deal. Listing terminated. They relist during holdover period with another brokerage (exclusively) and seller calls buyer agent to reignite the negotiation and they ultimately do a deal. Is it worth pursing?
Answer:
A holdover clause will ordinarily continue following Cancellation, Suspension or other Termination. It is designed to prevent the “end run” by the client. Here, you are entitled to the full amount. You have to sue in Small Claims Court to recover from the Client.
It will also protect you during the holdover period for the difference in what you charged and any lower rate charged by the Second Brokerage. Here, you are entitled to the differential. This amount should be available to you through Arbitration at your Board.
The Board might not take jurisdiction if the Brokerage is not a member, or if it is an exclusive as you mention.
Brian Madigan LL.B., Broker