Salespersons shall disclose to their clients in writing – CPD courses
Example: CPD courses
Salespersons shall disclose to their clients in writing if the other party to the transaction or the other party’s salesperson is from the same estate agent. Salespersons should also make a disclosure in writing if they have a formal or informal arrangement to collect an overriding fee from, or otherwise share or receive a part of, the commission of another salesperson representing the other party in the same property transaction. CPD courses
Example 1:
Salesperson A is representing the seller in the sale of a property. Salesperson B is representing the purchaser and both salespersons have a co-broke arrangement. Salespersons A and B are from the same Estate Agent; B is the supervisor/team leader of A and will get the co-broke commission as well as an overriding fee from A. In such an instance, Salesperson B shall disclose in writing to the purchaser that (i) both salespersons are from the same estate agent and Salesperson B is the supervisor/team leader of Salesperson A; (ii) Salesperson B will be collecting the co-broke commission; and (iii) Salesperson B will be collecting an overriding fee from Salesperson A’s commission. CPD courses.
Salesperson A is similarly required to make the disclosure in writing to his client (the seller) that (i) both salespersons are from the same estate agent and Salesperson B is his supervisor/team leader; (ii) Salesperson B will be collecting the co-broke commission; and (iii) Salesperson B will be collecting an overriding fee from Salesperson A’s commission.
Example 2:
Salespersons C and D, who are representing the tenant, and Salespersons E and F, who are representing the landlord, are from the same Estate Agent. The tenant and the landlord both agree to pay commission to their respective salespersons. The commission earned by Salespersons C, D, E and F will be pooled together and divided amongst all salespersons of the Estate Agent as per the Estate Agent’s remuneration policy. CPD courses.
Salespersons C and D as well as Salespersons E and F are to disclose to their respective clients that such a remuneration policy is practised by their Estate Agent. This is to avoid the possibility of complaint that there was an undisclosed direct or indirect conflict of interest e.g. a complaint by the landlord that his salespersons chose to transact with the tenant to maximise their own personal remuneration instead of recommending another tenant who may not wish to pay commission but who may be prepared to pay a higher rental. CPD courses.
Source: Professional Service Manual – PSM
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