California Real Estate SalespersonLaws of Agency and Fiduciary DutiesMedium
A seller enters into an open listing with three different brokers simultaneously, retaining the right to sell the property herself without owing any commission. The seller personally finds a buyer through a friend and completes the sale without involving any of the three brokers. What commission, if any, is owed to the brokers?
- ANo commission is owed to any broker, since the seller was the procuring cause
- BAll three brokers split the commission equally regardless of who found the buyer
- CEach broker is owed an equal one-third share of the standard commission
- DThe broker who invested the most marketing effort is owed the full commission
Show answer & explanationAnswer & explanation
Correct answer: A. No commission is owed to any broker, since the seller was the procuring cause
In an open listing, a seller who reserves the right to sell without owing a commission and personally procures the buyer owes no commission to any listed broker. Commission under an open listing is only earned by whichever broker actually produces a ready, willing, and able buyer who completes the transaction.
Why the other options are wrong
- B. Incorrect; open listing commissions go only to whichever broker is procuring cause, not split among all.
- C. Incorrect; open listings do not entitle non-procuring brokers to any share.
- D. Incorrect; marketing effort alone does not earn a commission absent actually producing the buyer.
Open Listing Commission Rules
Under an open listing, only the broker who actually produces the buyer earns a commission; if the seller finds their own buyer while reserving that right, no commission is owed to any broker.
- Multiple brokers can hold open listings simultaneously.
- Only the procuring broker is paid.
- Seller can self-sell commission-free if the right is reserved.
Memory trick: Open listing: first to the finish line (or the seller alone) gets the prize.