For most property practitioners, few things are more frustrating than closing a deal - only to have it collapse before registration.

The question that follows is always the same:

“Do I still get my commission?”

The answer depends on the contract, the timing, and the reason the sale fell through.

Here’s what every agent, buyer, and seller should know about commission rights, breach of contract, deposits, and how to protect your income when things go wrong.

When Is an Agent Legally Entitled to Commission?

An estate agent earns commission when they have fulfilled the mandate and introduced a willing and able buyer to the seller.

That typically means:

• A valid offer to purchase (OTP) was signed;
• The offer was accepted by the seller; and
• The buyer was able to perform (financially qualified or bond approved).

Once these elements are met, the agent’s right to commission vests - even if the sale hasn’t yet transferred.

💡 The key principle: Commission is usually earned upon the conclusion of a binding sale agreement, not upon registration - unless the mandate or OTP states otherwise.

When the Buyer Is in Breach

If the buyer breaches the contract (for example, fails to obtain finance, pay the deposit, or perform obligations), the agent may still have a valid claim for commission if the breach occurred after a binding sale existed.

• The buyer may be liable to pay the commission, even if they didn't accept a bond grant after getting approved.
• The buyer could also be held liable for damages if their breach caused the agent’s commission loss, though this requires legal action and proof of causation.

This is why a clear, written sale agreement is critical - it defines what constitites as breach an non-performance in terms of the buyer's obligations..

When the Seller Is in Breach

If a seller wrongfully cancels the deal, refuses to sign transfer documents, or otherwise prevents registration, the agent may have a strong claim for:

• Full commission (as the agent performed their duties), and/or
• Damages for lost income caused by the seller’s breach.

In these cases, courts generally protect the agent’s rights - provided the buyer was ready, willing, and able to proceed.

Example: If the seller accepts a better offer after signing an OTP, they may owe the agent full commission even though the property never transferred.

The Importance of Buyer Deposits

One of the most effective ways to protect all parties - especially the agent - is to ensure buyer deposits are held in trust by the conveyancer or estate agency.

Deposits serve several vital purposes:

• They prove buyer commitment and financial readiness.
• They provide security for damages or penalties if the buyer defaults.
• They create a clear, traceable record of good faith for the transaction.

If a buyer walks away from a valid OTP, part or all of the deposit may be forfeited to the seller - and in some cases, a portion can be used to pay the agent’s commission.

Deposits also prevent misunderstandings around “conditional” offers and help ensure that both parties take the process seriously.

Common Pitfalls Agents Should Avoid

1. Unclear commission clauses
   Always specify when commission is earned - on acceptance, bond grant, or registration.
2. No written mandate
   Verbal agreements are risky and hard to enforce in court.
3. Relying on trust
   Deposits should never be held privately or by an unregistered third party.
4. Failing to act on breach
   If a deal collapses, get legal advice immediately - delaying action can weaken your claim.
5. Not verifying suspensive conditions
   If finance or other conditions aren’t met, the agreement lapses and commission isn’t earned.

Claiming Damages or Commission Through the Courts

If informal resolution fails, agents can pursue:

• Contractual claims (for commission due under the mandate or OTP);
• Delictual or damages claims (if a breach caused measurable loss); or
• CSOS or PPRA complaints (in cases of unethical conduct by other practitioners).

Each situation is fact-specific - success depends on the documents, timing, and legal advice obtained early in the process.

How to Protect Your Commission from the Start

• Use written mandates with clear commission triggers.
• Keep email or WhatsApp trails proving your introduction and involvement.
• Ensure buyer deposits are safely held in a registered trust account.
• Partner with an experienced conveyancer who can secure the agent’s rights from day one.
• Seek legal advice immediately if the deal begins to unravel.

How VDM Attorneys Can Help

At VDM Attorneys, we work closely with estate agencies, developers, and conveyancers to:

• Draft watertight mandates and OTP clauses;
• Enforce commission and damages claims;
• Manage deposit disputes; and
• Represent agents in litigation or mediation when deals collapse.

Your time, expertise, and reputation deserve protection.

Don’t let uncertainty - or someone else’s breach - cost you your income.

📩 Contact VDM Attorneys for advice on commission disputes, breach of contract, or recovering damages.