A recent case which took place in the Western Cape High Court addressed the matter of whether or not a sole mandate agreement is binding.
A sole mandate is a contract between an estate agent and seller where the seller agrees to appoint the specific estate agent to sell his property.
This means that no other estate agent may sell the property for the amount of time stipulated in the exclusive mandate agreement.
In the above-mentioned case, the husband signed a sole mandate agreement with one estate agency during the time in which he was getting divorced from his wife. The couple was married in community of property.
His wife had not signed the sole mandate agreement. The agency had found a purchaser during the time of the mandate; however, the offer was not accepted.
It was at this point that the property was sold to another purchaser who was introduced by a different agency. The first agency sued for commission.
The husband’s attorney presented the argument that in accordance with the Matrimonial Property Act, in order for a sole mandate agreement to be binding, the written consent of both spouses married in community of property is required.
According to the section of the Matrimonial Property Act that the attorney had referred to, spouses are prohibited from acting alone with regards to joint estate.
This resulted in their joint estate losing its property rights and therefore, the judge found in favour of the initial estate agency and that the mandate was enforceable and valid.
As a result, the estate agency was entitled to be paid their commission.
Our attorneys specialise in property law and can provide you with expert legal advice regarding property matters in South Africa, including sole mandate agreements. Contact us to find out more.
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