Takeaway #1 for consumers - Be careful with whom you do business. The listing contract a home seller signs is a contract with the broker and not with the agent. The agent can sign for the broker when entering into the agreement but cannot modify or cancel the listing agreement without the broker's consent. You may believe that the agent would be fair and reasonable in making accommodations under a listing agreement, but it is not the agent's prerogative to change the contract. Some brokers are simply more litigious than others. When considering hiring a real estate brokerage, search the CCAP records for the company to see how many times the listing broker has been involved in litigation.
Takeaway #2 for consumers - Give careful consideration and seek legal advice before entering into a real estate listing agreement. People often treat the listing agreement as a mere formality. Sellers assume that the form must be fair since it is standard. They also assume that they know generally what it says without reading it. THIS IS DANGEROUS. Most people do not realize, for example, that a commission is earned regardless of whether a transaction closes!!?! The fact of closing does not affect whether a commission is earned under the standard form listing agreement. The agent presenting the agreement may offer assurances such as, "we never try to collect when the deal doesn't close." Do not believe it. The agent does not have the authority to modify the agreement to that effect and does not have the ability to live up to that promise even if he or she wants to. The contract is between the seller and the broker. Further, there are many cases where a listing company has sued a seller for a commission even though the transaction did not close.
Takeaway #3 for consumers. At a minimum, read the contract. For example, many sellers do not realize that the standard form listing contract default language includes a 1 year "tail" for protected buyers. This means that the listing company may have a claim for commission up to 1 year after the listing agreement has expired. Given a 6 year statute of limitations on contract claims, a broker may be able to bring a commission claim against a seller almost 7 years after closing.