In a ruling handed down on 9 April 2015, the Court of Cassation ruled that it is possible for an estate agent to receive remuneration from both the buyer and the seller for the same transaction.
In the Court's view, there is no provision in Act no. 70-9 of 2 January 1970 and Decree no. 72-678 of 20 July 1972 that would prevent a real estate intermediary from asserting his right to double remuneration on the basis of the existence of two mandates, one with the seller and the other with the buyer. This is, of course, subject to compliance with the aforementioned legislation.
In this case, the estate agent had a mandate to sell a house and a search mandate. Both contracts provided for remuneration.
The estate agent subsequently negotiated the sale of the house with the person who had given him the search mandate, resulting in a promise to sell, which subsequently lapsed when the seller withdrew.
The following year, the same parties to the preliminary contract finally signed the deed of sale without the assistance of the estate agent.
As a result, the agent took legal action to recover damages.
In their defence, the sellers and buyers argued that it was impossible for the agent to receive two commissions for the same transaction. This defence was upheld at first instance, and then by the Pau Court of Appeal, which ruled that, under article 73 of the decree of 20 July 1972, a duly appointed estate agent may not directly or indirectly request or receive any other remuneration or commission in respect of a transaction specified in article 1 of the law of 2 January 1970. As a result, estate agents cannot receive double remuneration from the vendor and the purchaser.
Not satisfied with this ruling, the estate agent appealed to the French Supreme Court.
On 9 April 2015, the Court of Cassation's 1st Civil Division ruled in favour of the estate agent, overturning the appeal ruling. There is nothing in French law to prevent a real estate agent from receiving double remuneration for the same transaction, provided that a sales mandate and a search mandate coexist.
"The right to commission exists for each of the mandates as long as the prescribed requirements are met". The sellers and buyers were ordered to pay €3,000 in damages to the estate agent. The case has been referred back to the Bordeaux Court of Appeal to be re-examined in the light of the Court of Cassation's ruling.
