These agents generally offer their services under what are commonly known as ‘sole selling business rights’ which means that for the duration of the contract, unless and until terminated, they have the exclusive right to market the client’s business and property. Payment of the agent’s fees are usually contingent upon the conclusion of the contract for the sale of the business although there is often a ‘one off’ marketing fee which is paid up front.
Utilising a reputable commercial and business agent in the sale of a business or property can result in a very successful outcome for the client. However, it is advisable for any business who is contemplating instructing an agent to do so with caution.
Commercial agents usually operate under standard terms and conditions in small print which can obligate the client to pay a fee, in certain circumstances, long after the contract has come to an end. The terms may not stipulate what the client is getting for their money. Cancellation of the contract may be contingent on payment of a cancellation charge. The agent may seek to bind the person signing the agreement under a personal guarantee and if the client has second thoughts after signing, unless there is a ‘cooling off period’ in the agreement, the client will usually find that they are unable to cancel the agreement.
It’s also worth bearing in mind that the Sales Representative for the agent may work on a commission and will have a financial incentive to get the client signed up.
If you are approached by a commercial and business agent or you approach them, it is advisable to:
If you require any legal assistance from the Civil Litigation Department at Williamsons Solicitors, please do not hesitate to contact us on 01482 323697.
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