#7 Authority to exchange contracts
Agents are authorised under the Property, Stock and Business Agents Act 2002 to participate in the exchange of contracts for the sale and purchase of land. This authority is not absolute and is limited and excluded in certain circumstances. Agents need to be aware of their rights and where the limitations lie in order to avoid the risk of any potential litigation. An example of a particular situation where issues may arise is where a party is represented by a solicitor or conveyancer. The agent may not then participate in the exchange unless expressly authorised to do so by solicitor/conveyancer or Vendor/Purchaser. As a matter of best practice this should be obtained as a written authority to avoid the potential for the agent to be opened up to a claim for negligence when a sale falls through.
Please watch our video on the pitfalls for agents that may arise in the exchange process and how best to fully discharge their duty when participating in the exchange process.