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REIQ Journal : August 2008
While it is true that no sale can proceed without the execution of a contract, very rarely (if ever) could it be said that the execution was itself the “effective cause” of the sale. Signing the contract that is subject to the satisfaction of conditions is more properly seen as a component of the sale process itself. In most, if not all, cases the effective cause of a sale will occur prior to the execution of the contract. While the Appeals Tribunal considered that conclusion to be common sense, it is also supported by the wording of clause 2.1 of the REIQ Schedule to the PAMD Form 22A, which reads: The Client agrees to pay the Agent commission as specified in the Appointment if a Contract of Sale of the Property is entered into with a buyer, whether within the Term or after the Term, where the Relevant Person is the effective cause of sale within the Term… [emphasis added] There is a clear distinction between the entering into of a contract of sale, and the effective cause of the sale. The Appeals Tribunal also did not deem that the satisfaction of Special Condition 5 was the effective cause of the sale. Special Condition 5 was satisfied. In the Appeal Tribunal’s finding, there was no break in the causal relationship between the respondent’s actions and the eventual sale. Conclusions The effective cause of sale was the introduction of the buyers and the subsequent negotiations, both of which took place outside the term of the claimants’ appointment. Therefore the Appeals Tribunal decided: 1. The respondent was the effective cause of sale by its introduction of the buyers and negotiation of the contractual terms on 26 – 27 November 2007; and 2. The actions that were the effective cause of sale of the property were performed prior to 28 November 2008. It followed that the Appeals Tribunal affirmed the decision of the Tribunal which was: 1. That the claim for commission by the claimant was dismissed; 2. That the claimants’ allegations of breaches of the Articles of the Standards of Business Practice by the respondent be dismissed; 3. That the respondent’s allegations of breaches of the Articles of the Standards of Business Practice by the claimants be dismissed; and 4. That there be no order as to costs. Limited EXCLUSIVE Areas U SNOOZE U LOSE inquire today email@example.com p: 3265 3546 www.gogecko.com.au REIQ Journal August 2008 357% Growth in 9 months with EXCLUSIVE areas, once there gone there gone Go Gecko here to STAY We are breeding Multiplying like RABBITS GECKO’s