Under an estate agency agreement, the agency undertakes activities aimed at concluding a property agreement, and the client undertakes to pay commission. The agreement should clearly define its scope, commission amount and payment date, duration, any exclusivity, and the agent’s duties. Where the client is a consumer, additional protection applies, including a ban on unfair terms.
What type of agreement is it?
Real estate brokerage is based on an agency agreement. Where the client is a business, it is governed by the Commercial Code: the intermediary works to give the client an opportunity to conclude a particular agreement, and the client pays remuneration, or commission (Section 642). Where the client is a consumer, such as an ordinary seller or buyer, the Civil Code’s agency agreement rules apply. Remuneration is payable only where the result was achieved through the intermediary’s efforts (Section 774), and it must be agreed in accordance with the applicable rules (Section 775).
What should the agreement include?
- A precise definition of its scope: the property and type of agreement to be brokered, whether a sale, purchase or lease.
- The commission amount and payment date, and the condition triggering entitlement, discussed further in our separate question on commission.
- The agreement’s duration and how it can be ended.
- Any exclusivity and its scope.
- The agent’s duties, such as advertising, viewings and assistance with preparing agreements, and the client’s duties.
The law also requires the agent to notify the client of material circumstances (Section 643) and not to propose an agreement with a person whom the agent knows there are reasonable grounds to doubt will fulfil their obligations (Section 649).
Take care with consumer clients
An agreement with a consumer is a consumer contract. It must not contain unfair terms, such as disproportionate commission on termination without a result. If concluded remotely or away from business premises, the consumer generally has 14 days to withdraw. We address these topics in separate questions.
We prepare templates and agreement terms through our legal services for estate agencies. Agents learn to use them through estate agent training, while our estate agency retainer provides ongoing support.
This answer provides general information on the law as at 21 July 2026. It does not constitute legal services or replace an assessment of an individual case. The details of your situation may differ. Book a consultation to discuss them.
