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What Are Your Estate Agent's Responsibilities In Terms Of The EAAB's Code Of Conduct?


What Are Your Estate Agent's Responsibilities In Terms Of The EAAB's Code Of Conduct?

Estate agents have according to the Code of Conduct a general duty to protect the public's interest.

The Estate Agency Affairs Board (EAAB) is empowered by law (Act 112 of 1976) to protect consumers against unscrupulous estate agents and those agents who generally do not follow the Code of Conduct. Therefore, the EAAB has the responsibility to process all claims lodged against the Fidelity Fund by members of the public as a result of misconduct by estate agents.

In the event of a seller or buyer of property feeling uncomfortable with the way in which an estate agent has been conducting his or her business, the following guidelines should give a fair indication of what the state agent's duties and obligations are in terms of the Code of Conduct.


An Estate agent;

- Shall not in the conduct of his business do or omit to do any act, which is contrary to the integrity of estate agents in general;

- Shall protect the interests of his client at all times, with due respect for all the parties involved;

- Never wilfully or negligently, fail to perform any work or duties with care and skill;

- Shall comply with the Act and all regulations;

- Never use a front to perform any duty, which would not be permissible for him to do as an estate agent;

- Never deny equal services to any person for reasons of race, gender, creed or country of origin;

- Never discriminate against a prospective purchaser on the grounds that such purchaser will not or is unlikely to, make use of financial assistance made available by a specific person or financial institution and which the estate agent offers to arrange on his behalf.


An Estate agent;

- Never act without a mandate (sole or open mandate);

- Never act on behalf of a prospective purchaser, unless the purchaser has given the mandate to act;

- Never accept a sole mandate unless;

- all the terms are in writing and signed by the client; and

- the expiry date of the mandate expressed as a calendar date and specifically recorded on the mandate.

- never accept a sole mandate which contains a provision conferring upon him;

- an option to extend for a certain period after expiry; or

- a mandate to continue to render the same estate agency services referred to in the sole mandate, unless-

- the client has prior to signing the sole mandate, expressly consented in writing to the inclusion of such provision;

- the document explains the reasons for and implications of such provision; and

- both the client and the estate agent sign the document.

- Never accept a mandate which confers power of attorney to act on behalf of the person conferring the mandate, unless the intention and effect is fully explained in the document;

- Include or accept the benefit in a contract of sale of immovable property negotiated by him, where a sole mandate is directly or indirectly conferred upon him to sell the said property;

- Never accept any mandate if his interest would compete with any obligations towards an existing client without first disclosing such interest;

- Never knowingly or negligently make misrepresentations concerning the likely market value or rental income in order to obtain a mandate;

- Never accept a mandate if it requires specialised skill or knowledge falling outside his field of competence;

- Never accept a sole mandate unless;

- The legal implications have been explained to the client should the client sell without his assistance;

- The specific obligations in respect of marketing the property.


- Convey to prospective purchaser all the facts concerning the property that are reasonably be within his personal knowledge;

- If he conducts business in terms of a franchise, disclose clearly the that he operates as such state his name and the name of the franchisor;

- If he conduct business under a trade name other than his own name, clearly disclose his full name in all correspondence and all documentation;

- Never accept a mandate if it conflicts with a previously accepted mandate;

- No estate agent shall purchase or lease for himself a property for which he has a mandate, without the consent of the person who granted the mandate;


- Never publish an advertisement which could create the impression it was published by the owner;

- Wilfully or negligently make any false statements (oral or written);

- Claim to be a specialist with regards to any estate agency service, if false;

- Market a property at another price other than the agreed upon price as per the mandate;

- Wilfully or negligently mislead or misrepresent any matter pertaining to the property;

- Use any harmful or misleading marketing techniques to influence any person to confer a mandate to him;

- Use any firm name which may cause confusion on the part of the public in respect of the nature of the business carried by him;

- Never inform any person involved in the property transaction that an offer has been received, unless;

- It is in writing;

- Has been signed by the offeror;

- And to his knowledge is a bona fide offer.

- Never affix a sale or lease board to the property, unless;

- The seller / lessor has given his written consent;

- The estate agent has a mandate


- Always present an offer to the seller, unless you have been instructed by the seller not to;

- Never present competing offers to a seller in such a way as to induce the seller to accept an offer without regard to the advantages and disadvantages of both;

- Never amend a signed offer, prior to rejection or a written mandate without the consent of all parties involved;

- Always explain the meaning and consequences of all the provisions of a contract prior to signature;

- If an offer has or has not been accepted by the expiry date, he must inform the offeror;

- Immediately, furnish every contracting party with a copy of the agreement of sale / lease agreement.


- Never without good cause, directly or indirectly solicit, encourage, persuade or influence and party or potential party to utilise or refrain from utilising;

- The services of a particular attorney, conveyancer or firm of attorneys;

- The services or financial assistance offered by any financial institution;

- The financial assistance offered to such party by any person.


- No agent shall stipulate or demand or receive directly or indirectly any remuneration, commission or benefit arising from a pending or completed contract which is subject to -

- A suspensive condition, until such time that the condition is fulfilled

- A resolutive condition, during this time the transaction may fall away as a result of the resolutive condition provided that the following does not apply;

- Good cause exists;

▪ The party liable for the payment of the remuneration consented to payment in a written document separate to the contract

▪ Such document contains an explication of the implications and financial risks for such payment;

▪ The document must be signed by the party and the estate agent

- Never convey to a client or any other party to a completed or proposed property transaction that he is precluded by law from charging less than a particular commission of fee or that the commission / fee is prescribed by any law or anybody

- Never introduce a prospective purchaser to the property or the seller, if he knows or has reason to believe that such a person has already been introduced to the seller or property by another agent

- Never include any provision providing for the payment of the commission by the seller, regardless of the fact whether the purchaser is financially able to fulfil his obligations in terms of the agreement, unless;

- Good cause exists

- The seller, prior to signature of the contract or mandate consented in writing in a document executed independently of the said mandate

- Such document contains an explication of the financial implications and risks

- Such a document is signed by both the seller and the estate agent

- Never include any clause negotiated by him, entitling him to deduct from any money entrusted to him in terms of the agreement, provided the a foregoing shall not be construed so as to prohibit the agent from making such deduction when the money is paid over by him to the party entitled.


- Never solicit or influence any person entitled to trust funds in the agents possession to pay the estate agent directly or indirectly any interest on monies deposited

- Before any money is received in the trust account, it must be disclosed to the parties that unless they agree in writing to whom the interest earned on such money must be paid, the interest accrue to the Estate Agents Fidelity Fund.

- Any money in trust must be invested at the best interest rate available in the circumstances at the bank or building society where he normally keeps his trust account

- The full amount of interest must be paid over to the party entitled to it

- Never include any provision providing for payment to the seller, prior to registration of transfer of the property in the purchasers name, unless;

- Good cause exists

- The purchaser has prior to signature of the contract, consented in writing in a document executed independently of the contract of such payment

- Such a document explains the implications and financial risk of such payment

- Signed by the seller, purchaser and the estate agent


- No agent shall without good cause divulge to any third party any confidential information obtained by him concerning the business affairs, trade secrets or technical information of a client or party to a transaction


- Every estate agent who is a sole proprietor of an estate agency or a partner in a partnership or a director of a company carrying on the business of an estate agent shall be responsible for any contravention of or failure to comply with this code of conduct by any other partner, director, or by any estate agent in the service of such sole proprietorship, partnership, company or close corporation, unless he has prior to such contravention or failure to comply taken all reasonable steps to prevent such contravention or should have prevented the contravention.

Author STBB Attorneys - Maryna Botha / Annetjie Coetzee
Published 17 May 2019 / Views -
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