Authorization to sell

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Authorization to sell
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Authorization to sell is a listing contract whereby a representative is employed by a seller to secure a buyer for the property. An authorization to sell does not give the agent the authority to enter into a binding contract of sale. For an agent to enter into a binding contract she/he requires a special authorization just like a limited power of attorney. Unlike the contract for the sale of real property, the broker's authorization to sell need not contain all of the terms and conditions upon which the real property is to be sold. The details of the sale may be supplied orally pursuant to the broker's authorization, so long as the fact of employment is reduced to writing (this definition is based on estate principles)[1].

Types of authority

Two types of authority[2]:

  • Actual authority - the principal conveys to the agent the right and power to act on the principal's behalf the with third parties. Actual authority may be express or implied. Express authority: principal expressly tells the agent, she/he has the authority. Implied authority: agent's authority is inferred from the principal's conduct (an agent has implied authority to do what is needed to accomplish assigned tasks)
  • Apparent authority - the principal gives the appearance to third parties than an agent is authorized. The principal is liable to third parties if an agent acted with apparent authority, but the principal may hold the agent liable for exceeding his/her authority. The test for apparent authority is was it reasonable for the third party to believe the agent was authorized. Disregard secret instructions given to the agent by the principal unless the instructions were known to the third party.

Exclusive authorization and right-to-sell listing

This is example from real estate principles. The most commonly used form of agreement is the exclusive authorization and right-to-sell listing. With this type of listing, the broker is entitled to a commission no matter who sells the property. Even if the owner appears to find a buyer without the broker's assistance. The buyer may have found the property address on the Internet, for example, or may have seen a sign on the property and contacted the owner directly. The listing broker is the owner's agent but has the option of being a dual agent. The commission typically is shared with any cooperating broker or subagent who procures a buyer. This type of listing agreement usually contains a safety clause that will cover a buyer the broker is working with even after the listing expires, as long as the broker has registered that buyer with the owner. The contract will specify the length of time after the listing expires during which the broker may still be compensated[3].

Multiple listing clause

The multiple listing clause that is a part of the exclusive authorization and right-to-sell listing allows the property to be made available to other brokers participating in the multiple listing service (MLS). The requirements of the broker's multiple listing service determine whether the broker must place every listing into the MLS and how members of the MLS will be treated[4].


  1. P. S. Atiyah, J. N. Adams, H. L. MacQueen 2005, p.141
  2. P. DeBole, J. E. Lanciano 2007, p.63
  3. C. O. Stapleton, M. R. Williams 2004, p.142
  4. C. O. Stapleton, M. R. Williams 2004, p.142


Author: Paulina Czarnota