New South Wales Consolidated Regulations

PROPERTY, STOCK AND BUSINESS AGENTS REGULATION 2003 - SCHEDULE 11

SCHEDULE 11 – Terms specific to agency agreement for sale of business

(Clause 13)

1 Exclusive agency and sole agency agreements

(1) If the agency agreement is an exclusive agency agreement the agreement must include the following statement:

IMPORTANT: This is an exclusive agency agreement. This means you may have to pay the agent commission even if another agent (or you) sell the business or introduce a buyer who later buys the business.

(2) If the agency agreement is a sole agency agreement the agreement must include the following statement:

IMPORTANT: This is a sole agency agreement. This means you may have to pay the agent commission even if another agent sells the business or introduces a buyer who later buys the business.

(3) An agency agreement is an "exclusive agency agreement" if the agreement provides for the agent to be entitled to commission on the happening of an event whether or not the agent is the effective cause of the happening of the event and whether or not the client is the effective cause of the happening of the event.

(4) An agency agreement is a "sole agency agreement" if the agreement provides for the agent to be entitled to commission on the happening of an event (whether or not the agent is the effective cause of the happening of the event) unless the client is the effective cause of the happening of the event.

(5) A statement that an agency agreement is required to include by this clause must be included in the agreement immediately following the term required by clause 9 (Remuneration) of Schedule 7 and must be no less prominent than that term.

2 Warning about other agency agreements

(1) The agency agreement must include the following statement:

WARNING: Have you signed an agency agreement for the sale of this business with another agent? If you have you may have to pay 2 commissions (if this agreement or the other agreement you have signed is a sole or exclusive agency agreement).

(2) A statement that an agency agreement is required to include by this clause must be included in the agreement immediately following the term required by clause 9 (Remuneration) of Schedule 7 or immediately following the statement required by clause 1 of this Schedule, and must be no less prominent than that term or statement.

3 Transfer of liability for the leasing or hire purchase of inclusions

The agreement must include any written confirmation prepared for the purposes of clause 3 of Schedule 4 of any specific instructions given to the agent by the principal before the agreement is entered into about arrangements for the transfer to the purchaser of any liability for the leasing or hire purchase of goodwill, plant, fittings or stock in inventory included in the sale.

4 Specific instructions about marketing and inspections

The agreement must include any written confirmation prepared for the purposes of clause 3 of Schedule 4 of any specific instructions given to the agent by the principal before the agreement is entered into about any of the following:

(a) the marketing of the business,

(b) the entitlement of prospective purchasers to inspect the premises of the business and the circumstances under which such an inspection can be made,

(c) the entitlement of prospective purchasers to inspect records, books of account and other documents concerning the business and the circumstances under which such an inspection can be made.

5 Sales inspection report to form part of the agreement

The agreement must include a copy of any sales inspection report prepared by the agent and given to the principal under clause 2 of Schedule 4.