Illinois Real Estate Practice Exam

A seller lists his property in an exclusive right to sell listing agreement with a licensee. Three weeks later the seller enters into another exclusive right to sell listing agreement with another agent. What should the licensee do:

1. Advise the seller to seek legal counsel because they may be liable to pay two commissions

2. Proceed with the sale and claim both commissions

3. Inform the new agent about the previous listing agreement

4. Offer to split the commission with the new agent

The correct answer is: Advise the seller to seek legal counsel because they may be liable to pay two commissions

In this scenario, the correct approach for the licensee is to advise the seller to seek legal counsel because there is a potential liability for having entered into two exclusive right to sell listings simultaneously. An exclusive right to sell listing agreement creates a binding contract between the seller and the listing agent, granting the agent the exclusive right to market and sell the property for the duration of the agreement. If a seller signs another exclusive agreement with a different agent without terminating the first one, they may be in breach of the first contract. The consequence of this situation can be that the seller may be responsible for paying commissions to both agents, as both have valid contracts. Legal counsel can provide guidance tailored to the specifics of the situation, and ensure that the seller understands the implications of their decisions, including potential financial liabilities. It is prudent for the licensee to take this action rather than pursuing further claims or negotiations, as the legal ramifications of dual agreements can complicate the sale process significantly.