Simon Says: Can you recover agency fees if your agent hid facts?

Published
08/16/2017 by

This is the twenty-fifth in a weekly series of legal advice provided in a short and entertaining story format.

 


Keywords: Contract, Estate Law, Agency, Duties of an agent, Sale and Purchase of Property, Agency fee

 

 

Can you recover agency fees if your agent hid facts?  

 

Jack, having invested successfully in stocks, decided to upgrade living. No longer was he going to live in that sorry coffin of a flat. He hated living in the heart of a city as it was always noisy and he needed an absolutely silent environment to sleep comfortably.

 

Off Jack went to look for a flat in SongJiang District of Shanghai. SongJiang was the countryside of Shanghai, and a half hour drive away from the city. It had many newly-built mansions.

 

Jack, of course, wanted to get a bigger house to live in, but it was a little out of his budget. The real estate agent recommended him an old house which he could buy for a cheap price, and redecorate it. The house and redecoration costs combined was half of a new mansion, so Jack decided to go for this deal.

 

After signing the sale and purchase agreement and paying the deposit, Jack hired his Feng Shui master, Master Zhu to look at the place before redesigning it. Jack was a very superstitious man. The moment Master Zhu stepped inside the old house, his eyes widened and stopped in his tracks. He turned clammy and there was the glisten of a cold sweat. Feeling that something wasn’t right, Jack pulled the old Master out and asked him what had happened, fearing for a heart attack.

 

“I see blood all over the walls, and a family of four staring at me. I believe this house is haunted, and the family were murdered. These ghosts are red in colour, and they have this aura of revenge and hatred revolving around them. I fear for your life, Jack. You had better terminate the agreement and get another house.” Master Zhu said solemnly.

 

Seeing four gravestones not far away from them, Jack knew that the Master was not bluffing. He went back to the real estate agent and told him about the case. However, once Jack mentioned about terminating the agreement and getting the agency fee back, the agent was very uncooperative.

 

So can Jack terminate the agreement and get the fee back?

 

 

Prof Simon Says:

 

Yes, Jack can get the fee back in full.

 

Making sure the house is in a good condition and telling the buyer every detail is an obligation of the agent. If the agent deliberately cheated Jack to buy the house by not telling him it was haunted, it is a breach of the China Contract Law and he has to refund the fee in full. To avoid any uncertainty, it is recommended that agency fee not be paid until and unless the transaction is completed.

 

Simon Says - Episode 25: Can you recover agency fees if your agent hid facts?

 

 

For more about this or to contact Professor Simon Choi at www.acmeardent.comsimonhkchoi@163.com, +86 13823677853 or by WeChat: simonhkchoi. 

 

ACME Ardent's Simon Choi WeChat QR Code

 

"This article was originally written in Chinese by Mr Huanyu Li and rewritten into English by Simon Choi."

 

Simon Choi

About the Author: Professor Simon Choi

Prof Simon Choi, solicitor and linguist, is an international lawyer, qualified to practise law in England & Wales and in Hong Kong, China. Simon graduated from law schools of the Peking University, the University of London and the University of Hong Kong respectively, with an in-depth knowledge of Chinese laws and common laws and with more than 20 years experience in China practice and international trade, investment, finance, merger & acquisition. He is an adjunct professor of laws at the Zhongnan University of Economics and Law. Simon is the founding partner of Acme Ardent and can be reached at simonhkchoi@163.com or +86 13823677853.

Simon Says: Can you recover agency fees if your agent hid facts?

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