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Elements of a valid appointment to act


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Consumer Protection
ELEMENTS OF A VALID APPOINTMENT TO ACT
The following is a summary of the requirements under the Real Estate and Business Agents Act 1978 ("the Act"), Real Estate and Business Agents (General) Regulations 1979 and Code of Conduct for Agents and Sales Representatives 2011, which an agent must comply with in order to have a valid appointment to act. A valid appointment to act enables the agent to receive remuneration and or recover expenses as agreed with the principal for the services provided.
Section 60(1)(a)

An agent must be licensed and the holder of a current triennial certificate.


Section 60(1)(b)

An agent must have a valid appointment to act in writing signed by the person for whom the services are being provided or his lawfully authorised agent.


Section 60(2)(a)

The appointment must be contained in a document


Broome Real Estate Pty Ltd vs Howard [1999] WADC 73
Section 60(2)(a)(i)

The appointment must clearly set out the services to be rendered, eg Appointment to Sell, Auction, etc.


Section 60(2)(a)(ii)

Where specific property is to be the subject of those services the appointment must clearly identify the property; eg address of property, title details; business etc.


Section 60(2)(a)(iia)

Clearly set out a method by which the amount of remuneration is calculated.


Section 60(2)(c)

The person obtaining the signature of the principal(s) on the appointment must give a true copy of the appointment to the signatories immediately after the appointment is signed.



PENALTY $5,000

Applies to a person who demands or receives any commission, reward or other valuable consideration in contravention of the applicable legislation (s.60(3) of the Act).

Additionally, the State Administrative Tribunal can order repayment of commission, reward or other valuable consideration held in contravention of the Act or Regulations (Section 103(1)(d)).

Requirements under the Regulations
Regulation 6BA(2)
The appointment must contain a statement to the effect that commission charges are not pursuant to any scale fixed by law and are to be agreed upon between the parties. This statement must be placed immediately before any statement outlining the commission charges agreed to.
Regulation 6BA(1)(a)
Where the agreed commission, reward or other valuable consideration is expressed in percentage terms, it must also be expressed in monetary amounts (e.g. 3 percent of $450,000 equals $13,500)
Regulation 6BA(1)(b)(ii)
Where the agreed commission, reward or other valuable consideration to be received for services rendered (i.e. sales, as defined in s.61(4a) of the Act) is expressed as an hourly, weekly or other periodic rate, the maximum sum payable must also be specified in monetary terms (eg $500 per week to the maximum $3,000)
Regulation 6BA(1)(c)
Where the calculation of remuneration is dependant upon the use of certain services (e.g. property management and services) the appointment shall provide an explanation of the charges (eg gross rent, gross collections, letting fee) on which the fee for those services is based.
Regulation 6BA(1)(d)
Where any expenses are to be recovered by the agent, the agent must specify the nature of those expenses and clearly set out the method by which those expenses will be calculated.
Regulation 6BA(3)
The appointment to act must contain a statement in plain language to the effect that clients may seek assistance from the Commissioner if they have a dispute in relation to fees.

Code of Conduct Articles: 16 & 17

Any appointment to act signed by a principal (Seller / Landlord) must provide that any agreed commission, reward, or other valuable consideration, and any advertising or general expenses, be in writing with a maximum amount specified and initialled on the agreement by the principal.




The material provided by the Department of Commerce is provided voluntarily as a public service. The information and advice provided is made available in good faith and is derived from sources believed to be reliable and accurate at the time of publication. However the information is provided solely on the basis that readers will be responsible for making their own assessment of the matters discussed herein and are advised to verify all relevant representations, statements and information.

Changes in circumstances after a document has been published may impact on the accuracy of the information. No assurance is given as to the accuracy of any information or advice contained after publication.


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