5520 Incarico irrevocabile in esclusiva

[LEFT]I was recently approached by some Brtits wanting to sell their house in Italy as they were worried about an irrevocable, sole agency agreement they entered into without knowing or understanding the contents of the document they signed. Unfortunately for them, not being able to understand Italian, they didn’t see the penalty clause. [/LEFT]

We have discussed the issue of signing contractual documents here on Forum before, but since this is a reoccurring theme, I would like to reiterate the importance about understanding your rights and obligations before signing legally binding agreements.

[FONT=Verdana]If you decide to sell your house via an agent then make sure you receive an authentic translation of the agreement before you sign anything. Personally I wouldn’t enter into a sole agency agreement and I certainly don’t use these with my own clients. [/FONT]

[FONT=Verdana]Agents may use their own format or adopt standard agreements. These agreements are known as the Conferimento d’Incarico di Vendita Immobiliare.[/FONT]

[FONT=Verdana]These agreements are normally: [/FONT]
[LIST]
[*][LEFT][FONT=Verdana]Irrevocable and exclusive (some agents will tie you in for a year)[/FONT][/LEFT]
[*][LEFT][FONT=Verdana]Binding upon the vendor only[/FONT][/LEFT]
[/LIST][LEFT][FONT=Verdana]Moreover, they contain penalty clauses that are hefty if: [/FONT][/LEFT]
[LIST]
[*][LEFT]You refuse to sell the property according to the terms and conditions of the incarico agreement[/LEFT]
[*][LEFT][COLOR=black][FONT=Verdana]You revoke the agreement before it expires[/FONT][/COLOR][/LEFT]
[*][LEFT][COLOR=black][FONT=Verdana]You sell the property directly before it expires [/FONT][/COLOR][/LEFT]
[*][LEFT][COLOR=black][FONT=Verdana]You sell the property, even after the agreement expires, to buyers that may have been introduced by the agent (the agent should provide you with a list)[/FONT][/COLOR][/LEFT]
[*][LEFT][COLOR=black][FONT=Verdana]The sale doesn't go ahead because of any errors or misrepresentation on the part of the vendor[/FONT][/COLOR][/LEFT]
[*][LEFT][COLOR=black][FONT=Verdana]You fail to provide all relevant documentation that is pertinent to the sale (deed of origin, plans, planning and building permissions, habitation certificates, condominium expenses and any documents that [/FONT][/COLOR][FONT=Verdana]regularise any infringements of local planning laws together with receipts to prove that fines have been paid)[/FONT][/LEFT]
[*][LEFT][COLOR=black][FONT=Verdana]You fail to give the agent adequate access to the property for viewings [/FONT][/COLOR][/LEFT]
[/LIST][LEFT][COLOR=black][FONT=Verdana]Additionally, these agreements may contain a clause that oblige the vendor to pay the agent a sum of money equal to the commission due in the event the buyer withdraws from the preliminary or final contract. Some clauses may even give the agent authority to make variations to the agreement, although this should only be done with the express agreement of both parties.[/FONT][/COLOR][/LEFT]

[COLOR=black][FONT=Verdana]The other point is that t[/FONT][/COLOR][FONT=Verdana]hese agreements also stipulate that by signing the document, the parties are not only declaring that they have read each and every clause set forth on the agreement, but also that they approve and accept its contents in accordance with articles 1341 and 1342 of the Italian Civil Code. [/FONT]

[FONT=Verdana]If you do not understand Italian, have no authentic translated version of the agreement and remain unaware of your legal rights and obligations, you shouldn’t be accepting and approving such terms and conditions.[/FONT]

[COLOR=black][FONT=Verdana]Be very careful, as there is absolutely no point in giving money away unnecessarily. Penalties are equal to both the commission payable by you the vendor as well as the amount paid by the buyer, plus any costs (as per the provisions contained in article 1756 of the Italian Civil Code) for marketing the property. [/FONT][/COLOR]

[FONT=Verdana]In the case of the people who contacted me, months went by without the agent producing any potential buyers. When the vendors decided that enough was enough, the agent told them that they couldn’t revoke the agreement before the expiry date without paying a penalty. They now have to wait until 31/12/06.[/FONT]

[FONT=Verdana]Another thing to watch for is that sometimes these agreements are automatically renewable, and so it pays to make sure you fully understand them before accepting, otherwise you may find yourself being tied down for longer periods. If you have entered into an irrevocable sole agency agreement then it is always wise to write (via posta raccomandata) to the agent to obtain written confirmation that the agreement will in fact be terminated forthwith upon its expiry.[/FONT]

[FONT=Verdana]Now the agreement will also contain your asking price. In essence, you are engaging the agent, on an exclusive basis, to sell your house at that stated price. But sometimes problems can and do occur. In another case, after the price had been established and written into the agreement, the agent subsequently told the vendor that he had received an offer from a prospective buyer, although the offer was considerably lower than the original asking price. [/FONT]

Are you obliged by the terms of the agreement to accept this lower offer? If you reject the offer, are you in breach of the agreement?

[FONT=Verdana]Unless you have expressly agreed to lower the price (and this must be in writing with a variation to the agreement) you do not have to accept the lower offer and you will not be in breach of the agreement by rejecting it. [/FONT]

[FONT=Verdana]The bottom line? If you have to sell your house and the agent wants an incarico irrevocabile in esclusiva, then check the agreement before you sign it. If you are still unclear then have it checked by an independent professional. If the agent later asks you to reduce your price, don’t make verbal agreements – put it in writing. [/FONT]