[RPPTL Leasing Committee] Listing/Commission agreements in a PMA

[RPPTL Real Estate Leasing Committee]

Dear Group,

Our firm does not handle any real estate closings or real estate licensing or sales law.

I was under the impression that a “listing agreement” cannot be for more than 1 year and it cannot auto renew.  I could be wrong.

Routinely I see clauses in my client’s Property Management Agreements stating that in the event of sale, the owner must use the property manager’s real estate company, or it has a clause stating the commission due to the property manager’s real estate company if the property sells while under management. Sometimes it is due if the property sells to the tenant, sometimes, if it sells to anyone. Isn’t this the definition of a “listing agreement”?  A million years ago, I remember a case where an owner challenged this and won.

Most property management agreements have an autorenewal clause.

Does this make the clause unenforceable or even in direct violation of FREC rules?  Is the clause not a “listing agreement”?

Thanks!

Harry Heist

LAW OFFICES OF
HEIST, WEISSE & WOLK PLLC
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website:  www.evict.com<http://www.evict.com/>
Email:  harry at evict.com<mailto:harry at evict.com>


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