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Agent Retainer
Introductory Guidance Note
The property market can be a stressful and complicated space for those seeking out property to move into as well as those who want sell or lease/rent their own property. In the United Kingdom, the property market’s complex bureaucracy became fertile ground for the development of assistive and supportive professions related to real estate like property lawyers and estate agents. Access to the services these professionals provide can be extremely useful to prospective buyer, renter, seller or leaser. An individual interested in these services would typically enter into a legal agreement with the service provider through the signing and enactment of a retainer agreement.
Retainer agreements can come in a variety of forms and specifically can differ in the mode of payment and working schedule. For example, property solicitors typically bill their client following a standardised hourly rate, the client and the solicitor would also agree on whether the work is expected to be done in a set number of hours per month/week or whenever it is needed (which is more open-ended as maximum working hours are not set). A prospective buyer could request the assistance of a property agent to do the research and find a suitable property in their stead, in this case the agent, in addition to an hourly rate, may also request to be paid a finder’s fee. A seller, similarly, may pay an agent they have hired a commission, calculated a percentage of the property’s value or the final price of the property offered by the potential buyer.
Because of these variations and differences, it is important for inidividuals to understand how retainer agreements are composed and written, and what they legally imply. We have provided below a template for a standard retainer agreement with additional guidance notes for each clause of the agreement to help explain their content and any additional considerations worth keeping in mind as they may be different in other agreements.
1. The Parties
This Agent Retainer Agreement (the “Agreement”) is entered into as of [INSERT DATE] and is by and between:
Agent: [INSERT NAME], with an address of [INSERT ADDRESS], (the “Agent”)
AND
Client: [INSERT NAME], with an address of [INSERT ADDRESS], (the “Client”)
Collectively referred to as the “Parties”.
2. Term
The Agreement shall become effective on the date of signing the Agreement (the “Effective Date”) and will continue on a(n) [INSERT AGREEMENT DURATION] basis (the “Agreement Term”).
Upon the end of the Agreement Term, the Agreement will not be automatically renewed for another term.
3. Services
The Agent agrees to provide for the Client the following Services (the “Services”):
- [INSERT SERVICE]
- [INSERT SERVICE]
- [INSERT SERVICE]
- [INSERT SERVICE]
- [INSERT SERVICE]
- [INSERT SERVICE]
The Parties are in agreement that the Services shall be completed by [INSERT DEADLINE DATE] (the “Services Deadline”).
4. Retainer
It is hereby agreed that the Agent will provide an invoice with an amount of £[INSERT PAYMENT AMOUNT] to the Client on the first day of every month for all the Services provided, as well as any pre-approved expenses incurred during the previous month.
The Parties agree that the Client is to pay the invoice within [ ] days.
The Parties agree that the Client will pay the invoice by means of [INSERT PREFERRED PAYMENT METHOD].
5. Expenses
The Parties agree that the Agent is entitled to the reimbursement of all expenses incurred in providing the Services agreed upon.
The Client agrees to pre-approve all expenses that exceed the amount of [INSERT EXPENSE LIMIT], on condition that the Agent includes a proof of payment or a receipt for all of the reimbursable expenses.
6. Relationship Between the Parties
The Parties agree that the Agreement is a retainer agreement, where the Agent is an independent contractor who provides the services specified in the Agreement.
Under no circumstances shall the Agent be considered an employee, representative or partner.
The Agreement does not create any other partnership between the Parties.
7. Exclusivity
The Parties agree that this Agreement is not an exclusive arrangement and that the Parties are entitled to enter into other similar agreements with other parties.
This one is an interesting section because don’t some real estate agents ask to be the exclusive agent involved in the selling of a property? I understand there are also joint and multi-agent agreements where a single property is being managed for sale by multiple agents.
8. Termination
The Agreement may be terminated:
- Immediately, in the event that one of the Parties breaches the Agreement or one of the conditions set forth in the Agreement and does not amend them within a period of [INSERT AMENDMENT TIME LIMIT].
- At any given time by providing a written notice to the other party [INSERT TERMINATION NOTICE PERIOD] days prior to terminating the Agreement.
10. Dispute Resolition
Any dispute or difference whatsoever arising out of or in connection with the Agreement shall be submitted to Arbitration/mediation/negotiation (circle one) in accordance with, and subject to the laws of the United Kingdom of Great Britain and Northern Ireland.
11. Ownership
The Parties agree that all the work product that is created by the Agent will remain the exclusive property of the Client, as long as it is relevant to the performance of the Services set forth in the Agreement.
Would this clause be necessary in the real estate world?
12. Governing Law
The Agreement shall be governed and construed in accordance of the laws of the United Kingdom of Great Britain and Northern Ireland.
13. Confidentiality
All terms and conditions of the Agreement and any confidential information provided by the Client during the term of the Agreement must be kept confidential by the Agent, unless the disclosure is required pursuant to process of law.
Disclosing or using this information for any purpose beyond the scope of this Agreement, or beyond the exceptions set forth above, is expressly forbidden without the prior consent of the Company.
The Consultant’s obligation to maintain confidentiality will survive termination of this Agreement and will remain in effect indefinitely.
14. Severability
In the event that any provision of the Agreement is found to be void and unenforceable by a court of competent jurisdiction, then the remaining provisions will remain in force in accordance with the Parties’ intention.
15. Entire Agreement
The Agreement contains the entire agreement and understanding among the Parties hereto with respect to the subject matter hereof, and supersedes all prior agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter hereof. The express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof.
16. Amendments
The Parties agree that any amendments made to the Agreement must be in writing, where they must be signed by both Parties to the Agreement. Accordingly, any of the amendments made will be applied to the Agreement.
17. Signature and Date
By signing below it is demonstrated that the Parties hereby agree to the terms and conditions set out in the Agreement:
Agent:
Name:
Signature:
Date:
Client:
Name:
Signature:
Date: