By Pamela Núñez
Special for El Inmobiliario
In the dynamic world of real estate, clear and precise regulations are essential to protect both agencies and clients. Recently, our real estate agency, Canablue Real Estate, Punta Cana, was involved in a case that underscores the urgent need for more comprehensive legislation in the Dominican Republic.
It all started when a tourism professional, unfamiliar with the real estate sector, contacted us to sell a property to one of her clients. At our office, we explained our referral program in detail, designed to reward those who connect us with potential buyers. However, a small error in the wording of the referral agreement triggered a monumental mess.
The document failed to specify that the 10% commission applied only to the commission earned by our agency, not to the total sale price. This inadvertent but crucial oversight led the referring party to believe she was entitled to 10% of the property's total value, an amount exceeding even what our agency expected to earn in commissions from the transaction.
Despite our efforts to clarify the situation, the referring company chose to take the case to court. What followed was a lengthy and exhausting legal process that lasted two years. Finally, to our surprise and disappointment, the courts ruled in favor of the referring company, forcing us to pay 10% of the total sale, causing us a significant loss.
This verdict highlighted a painful reality: the lack of understanding of the specific terms of the real estate business by the judicial system and the absence of clear regulation to protect agencies in situations like ours.
The law currently supports agreements between the parties, and since our contract contained a procedural error, the ruling favored the referring agent. However, implementing specific regulations for the real estate sector could not only provide clear guidance for the courts but also prevent similar misunderstandings in the future, protecting agents, their referring agents, and clients alike.
This case not only highlights the current vulnerability of real estate agencies in the Dominican Republic, but also underscores the urgency of legislation that reflects the complexity and importance of the sector, ensuring adequate protection for all parties involved.
Although we have complied with the court order and completed the payment to the referring agency, it is crucial to highlight the ongoing concern regarding the lack of clear legal protections in our field. Effective regulation will not only strengthen agencies but also foster greater transparency and trust in the Dominican real estate market.
It is time for the real estate sector in the Dominican Republic to be supported by regulations that guarantee fairness, clarity, and justice for all its participants.
The author is Broker Owner of Canablue Real Estate, Punta Cana, with more than 10 years of experience in the real estate career.
