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

[RPPTL Real Estate Leasing Committee]

Harry, I am aware that at least one of the large international brokerage firms take the position that their Florida agreements cannot contain automatic renewal provisions.

Their position is that Florida brokerage law requires a definite expiration date in listing agreements.  Specifically, they cite § 475.25(1)(r), Florida Statutes which states that disciplinary action may be taken against a licensee if it is determined that a licensee: “Has failed in any written listing agreement to include a definite expiration date, description of the property, price and terms, fee or commission, and a proper signature of the principal(s); and has failed to give the principal(s) a legible, signed, true and correct copy of the listing agreement within 24 hours of obtaining the written listing agreement. The written listing agreement shall contain no provision requiring the person signing the listing to notify the broker of the intention to cancel the listing after such definite expiration date.”

Although  this language only references listing agreements this company has taken the position that their property management agreements may not contain automatic renewal provisions either.

Arthur J. Menor
Partner, Board Certified in Real Estate Law | Shutts & Bowen LLP
Tel: (561) 650-8510 | Cell: (561) 358-1572
525 Okeechobee Blvd., Ste. 1100, West Palm Beach, FL 33401
Bio<http://www.shutts.com/professionals-arthur-j-menor> | E-Mail<mailto:AMenor at shutts.com> | vCard<http://www.shutts.com/vcard-895.vcf> | www.shutts.com<http://www.shutts.com>

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From: landten-bounces at lists.flabarrpptl.org <landten-bounces at lists.flabarrpptl.org> On Behalf Of RPPTL Real Estate Leasing Committee
Sent: Monday, September 11, 2023 6:48 PM
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Subject: [RPPTL Leasing Committee] Listing/Commission agreements in a PMA

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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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