Early Release (Or Stealing?) Of Commission

Posted on May 10, 2007 by | 1 Comment

Tim O'Dwyer M.B., LL.Bby Tim O’Dwyer M.A., LL.B Queensland Solicitor & Consumer Advocate watchdog@argonautlegal.com.au

A solicitor mate of mine, Chris Bridge, recently had two celebrations: thirty years of legal practice and his first (possible) win with Queensland’s Office of Fair Trading. Early release of deposit or greedy grab for commission?

Queensland has no statutory equivalent to Section 27 of Victoria’s Sale of Land Act (for early deposit releases) as mentioned in Peter Mericka’s article “Early Release of Deposit”. Here it is quite uncommon for the parties to a contract to agree to an early deposit release, but it is not illegal.

There is no Queensland law permitting agents to take sales commissions from deposits held in their trust accounts before settlement even if both parties authorise it. Honest agents wait till their sales are settled. The occasional dishonest agent will steal money from the trust account, but that is another story.

Alarm bells rang when Chris Bridge noticed the following special condition in a contract which arrived all signed sealed and delivered on his suburban legal office desk:

“The client agrees that as and from the date upon which the contract of sale becomes unconditional, the agent shall immediately be entitled to payment of commission…and such commission shall be paid from the deposit monies AND FURTHER the client directs the stakeholder to release the commission to the Agent immediately the Contract of Sale becomes unconditional.”

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