Agent’s Negligence: Breach of Contract at Common law
Aside and apart from the Agent’s fiduciary duties, an Agent is obligated to fulfill any contractual promises made. That’s a simple common law obligation, just like anyone else, there’s nothing special here.
When an Agent has entered into a Listing Agreement there will be some fundamental issues clarified in the contract.
Listing the property, performing a comparative market analysis, reviewing the previous recent sold properties, comparing the properties currently on the market, advertising, marketing, showing the property, renovating, photography, videography, developing websites, planning a social media presence, painting, decorating, rental of furniture and artwork, conducting open houses, determining the hours, frequency, duration of MLS listing presence, withdrawal from market, commission offered to co-operating brokerages; these are all matters which should be addressed and identified specifically in the contract.
If the Agent signs the contract, but falls short, then, that’s breach of contract, and we have to look at the remedies available.
When we are simply talking about the contractual term, often there is “no big deal”, and you can “patch it up or do it next week”.
However, there are negligence issues too. The Agent leaves the door unlocked and someone enters and steals some property. That’s actionable. So too, would be a lawsuit from someone who tripped and fell down the basement stairs during a showing. They sue the Owner and the Owner claims over in negligence against the Agent.
When it comes to Buying, it’s more likely that the Agent will do something in error by omission or oversight.
First, simply looking for properties, then searching for appropriate properties which meet the pre-established criteria, maintaining good records of what is suitable, sending listings to the clients, booking showings, meeting to view the premises, identifying issues, writing up suitable Offers with the appropriate Conditions and Terms, arranging, supervising and reviewing the home inspection report, conducting “due diligence”, securing appropriate mortgage commitments from financial institutions; these are all basic and regular activities that are part of the Buyer’s Representation Agreement. Making an error is a breach of contract. Making a very serious error which causes the Client financial loss can amount to negligence.
Breach of Contract
Anything which happens to fall short of what was expected in the agreement is a breach of contract. There are remedies for that under contract law.
Negligence is conduct which falls short of what would be expected of a reasonable professional in the same circumstances. It has to be serious. Negligence is a category falling under the Law of Torts. A tort is a civil wrong. There must be actual injuries, financial loss or damages which befall an individual before a Court will conclude that there has been negligence.
But, it is interesting that a simple, but serious breach of contract may be all that is required.
Brian Madigan LL.B., Broker