Understand the Real Estate’s Responsibility for the Performance of its Contracts

performance real estate

It is true that in the rush of daily life there are many challenges. If you are a real estate agency, you know that constant contact with the public demands a lot of attention. There must be good management, a trained team, etc. Well, otherwise the losses will knock at the door.

Due to so many details, it is necessary that the real estate agency and its employees take care in transactions and contracts. In other words, pay extra attention to whether they are acting in accordance with the law. Because if you do so, you will avoid many legal hassles in the future.

The first step towards this shielding is to understand the real estate’s responsibilities and what the law says about its obligations.

Often, a real estate company’s reputation is tarnished because of minor mistakes and lack of knowledge of some duties and obligations, so the main weapon is knowledge.

If you want to avoid having problems with the law and have a good image in the real estate market, this post is for you.

Check out now the responsibilities of a real estate agency and ensure responsible work and within the law!

What does the Real Estate Liability Law say?

Intermediary work in the purchase, sale, administration and leasing of real estate involves several tasks. For example, fundraising, dissemination, evaluation, negotiation, transfer of values ​​etc. But each of these activities brings with it obligations and responsibilities.

For all Contractors

These responsibilities (obligations), generally, are provided for in article 422 of the Brazilian Civil Code. In other words, from this reading, I conclude that the actions of the real estate agency must follow the principles of probity and good faith.

“The contractors are obliged to keep, in the conclusion of the contract, as in its execution, the principles of probity and good faith. 

Article 422 of the Brazilian Civil Code

Although these terms seem very broad, it is possible to understand what justice demands of real estate brokerage professionals. Furthermore, although this article deals with the responsibility of real estate companies, it should be remembered that these principles apply to all contractors.

In fact, both in the pre-employment period and in the completion and fulfillment of the contract, probity and good faith must be observed.

But, let us proceed with the analysis of the obligations and responsibilities of brokers and real estate agents.

For brokers and real estate agents

Main Obligation of Real Estate Brokerage

As for the main contractual obligation of the real estate and brokerage professionals, article 722 says:

“Through the brokerage contract, a person, not connected to another by virtue of a mandate, provision of services or any dependent relationship, undertakes to obtain for the second one or more deals, according to the instructions received.”

So, in brokerage, the real estate agent is obliged to get the contracted business. That is, a buyer or tenant for the property etc. But not only that!

That is, it is not enough to present an interested party to the property owner. But yes, the useful result. In other words, you must get the business ordered as per the instructions received from the customer. Thus, the importance of formalizing a serious and detailed service provision contract becomes more evident.

How should Real Estate Brokerage be performed?

In Article 723, the Civil Code says how the broker or real estate agent must perform the work:

“The broker is obliged to perform the mediation with diligence and prudence, and to provide the client, spontaneously, with all information about the progress of the business.”

Thus, real estate should not neglect the care that the business requires. As well, one must not be reckless in conducting business. In this sense, one can adopt as a standard of conduct what the law establishes as obligations, in addition to what is customary in the market.

Further on, we will give some examples, in the purchase and sale and lease, which demonstrate diligence and prudence, as well as the duty to inform.

Real estate’s responsibilities in buying and selling

There are several obligations of the real estate agent or the realtor in the purchase and sale of properties.

As they are the intermediaries of the transaction, the responsibilities lie with both the seller and the buyer. Furthermore, these obligations derive from special laws that regulate the profession and the Civil Code.

Special legislation requirements

The first obligation of the real estate agency is that professionals are duly registered with CRECI (Regional Council of Real Estate Brokers). This is because CRECI is the body that oversees and regulates all activities of companies in the sector. Therefore, in addition to being mandatory, it is also a measure that conveys credibility and seriousness to consumers.

Another attribution of the real estate agency is to draw up a specific and detailed contract, with all the rights and duties of the buyer, seller and Real Estate Company.

The General Rules of Brokerage

In addition, the real estate agency is also responsible for analyzing all documents of the parties involved in the purchase and sale. Likewise, seek to certify the validity and veracity of all information, which must later be passed on to the buyer.

These obligations derive from articles 722 to 729 of the Civil Code. Below is an example:

“Under penalty of being liable for damages, the broker will provide the client with all clarifications about the security or risk of the business, changes in values ​​and other factors that may influence the results of the incumbency.”

Sole paragraph of article 722 of the civil code

Examples of diligence and prudence in buying and selling

For example, the law says that you must present the property’s tax and liens certificates. That is, to grant the purchase and sale deed and register the property. Thus, the real estate agent must provide such information to the client.

Furthermore, although they are no longer mandatory, certificates of deeds must be obtained in court. Well, it is a market practice that demonstrates prudence.

These certificates, however, may not be negative and point to possible condominium debts, legal disputes, default of IPTU (Territorial and Urban Building Tax) and other pending issues.

Therefore, legal obligations such as these generate the expectation that the real estate agency instructs you to research and even ask for certificates. That is, both personal and property certificates, among other details.

Likewise, if the broker is aware of any problem related to the property’s documentation, it must inform. For example, disputes over inheritance.

So, cases like these must be informed to the interested party before closing the deal. Therefore, omission, in this case, is an offense that can be punished if the lack of information causes damage to one of the parties.

In summary, the real estate agent’s duty is to ensure that the company will take care of all the purchase and sale procedures, in a way that provides security to the parties.

The responsibility of the real estate agency in real estate leasing

When a landlord goes to a real estate agency to handle the lease of his property, he signs a contract. In addition, in the contract or separately, he grants the company certain powers to administer these procedures on his behalf. And, in return, you are obliged to pay for the provision of services. But what does it mean?

real estate management contract

The real estate management contract is considered to be of a complex nature. That is, it comprises several typical contractual modalities, such as brokerageagencyservice provision and mandate . Therefore, this is a relationship full of demands and care that must be taken.

Therefore, that particular instrument signed by the parties under the name of real estate management, in fact, is several contracts. And each of these contracts has its own laws that regulate them.

For example, the real estate brokerage part is provided for in the Civil Code and in a special law. Furthermore, the power of attorney part is already regulated by the mandate rules.

So, to determine the responsibility, you have to verify where the problem occurred, as there are several legal regimes applied.

Power of attorney or mandate in the lease

According to the Civil Code, on the part of the command, the real estate agent may be responsible for indemnifying the owner. That is, in cases of negligent conduct on the part of the company – article 667 of the aforementioned Code.

Furthermore, as already highlighted, it is the responsibility of the real estate agency to lease the property with all the care and security of the owner. Furthermore, it must provide proof of the acts to prevent defaults carried out and that the guarantees for the payment of arrears are correct.

In case the real estate agency wants to close the deal at all costs; as well as not requiring proof of income, in addition to other information to fulfill the contract, she may be responsible for the tenant’s or guarantor’s default.

A common situation, equally, is that the real estate agency does not require documents and proof of assets from the guarantor. If you call the guarantor and do not find goods, because of such errors by the real estate agency, the responsibility will be hers and she will have to bear the losses.

Even so, it is not the responsibility of the real estate agency to pay rent, condominium fees or other fees if it has acted within the law.

All these measures, however, must be renewed every year, ensuring that there were no problems during the contract. This is because it is necessary to know if all these guarantees continue to assure the owner of the property.

Final considerations

Finally, for a real estate company to protect itself from possible lawsuits, it must act with clarity and within legal principles. By doing so, you will avoid real financial breaches and blemishes on the company’s reputation.

However, the ideal is to have experienced lawyers with experience in the real estate market. Well, specialized professionals are the best people to take care of all the details that involve the sector’s business.

Do you feel safer to close new contracts and capture properties for your company? Want to know more about real estate responsibilities and other issues related to the sector?


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