SRA Handbook

Statement of agreement

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Rule 4: Statement of agreement

4.1

When accepting instructions to act in the sale of a property, you must, at the outset of communication between you and the client, or as soon as is reasonably practicable, and before the client is committed to any liability towards you, give the client a written statement setting out whether or not you are to have "sole agency" or "sole selling rights". The statement must also include a clear explanation of the intention and effect of those terms, or any similar terms used, which shall, subject to (4.3) below, take the following form:

(a)

"Sole agency: You will be liable to pay a fee to us, in addition to any other costs or charges agreed, if unconditional contracts for the sale of the property are exchanged at any time: with a buyer introduced by us with whom we had negotiations about the property in the period during which we have sole agency; or with a buyer introduced by another agent during the period of our sole agency."

(b)

"Sole selling rights: You will be liable to pay a fee to us, in addition to any other costs or charges agreed, in each of the following circumstances:

(i)

if unconditional contracts for the sale of the property are exchanged in the period during which we have sole selling rights, even if the buyer was not found by us but by another agent or by any other person, including yourself; or

(ii)

if unconditional contracts for the sale of the property are exchanged after the expiry of the period during which we have sole selling rights but to a buyer who was introduced to you during that period or with whom we had negotiations about the property during that period."

4.2

If the statement refers to a "ready, willing and able" buyer (or similar term), you must include a clear explanation of the term, which shall, subject to (4.3) below, take the following form:

(a)

"A buyer is a "ready, willing and able" buyer if he or she is prepared and is able to exchange unconditional contracts for the purchase of your property. You will be liable to pay a fee to us, in addition to any other costs or charges agreed, if such a buyer is introduced by us in accordance with your instructions and this must be paid even if you subsequently withdraw and unconditional contracts for sale are not exchanged, irrespective of your reasons."

4.3

If, by reason of the provisions of the statement in which any of the terms referred to in (4.1) or (4.2) above appear, any of the prescribed explanations is in any way misleading, you should alter the content of the explanation so as accurately to describe the liability of the client to pay a fee in accordance with those provisions. Subject to this requirement, you should reproduce the explanations prominently, clearly and legibly without any material alterations or additions. They should be given no less prominence than that given to any other information in the statement apart from the heading, firm names, names of the parties, numbers or lettering subsequently inserted.

Note

(i)

The requirements of rule 4 correspond to those in the Estate Agents (Provision of Information) Regulations 1991 (SI 1991/859) and the Schedule to those Regulations. The requirements of rule 4 are in addition to the requirements in the SRA Code of Conduct in Chapter 1 in respect of client care.