Part Three(b) of Five: Listing Contract Addendum

This article and frequently asked questions (FAQs) is part three “b” (3b) of a five part series that will introduce the forms prior to their publication on August 1, 2024.

A redline of the revised Listing Contract Addendum can be found here.[1]

The title of the form now includes a blank spot to fill in which addendum number applies (e.g. the first addendum would be “1”).

Line 3 identifies the Broker.

Lines 7-16 allow three (3) potential terms that could be modified or added via click box:  The first is to modify Broker Compensation; the second is to modify the Term Expiration; and the third is any other term to be modified or added.

Lines 17-29 allow two (2) potential ways to cancel the agreement via click box.  The first includes no conditions to mutually cancel.  The second provides the parties space to include conditions that must be met for the cancellation to be effective.  Both cancellations include a mutual release.

FREQUENTLY ASKED QUESTIONS

Q1. Rather than draft two separate Addendums, why didn’t the workgroup draft a single Addendum that can be used to amend both a buyer representation agreement and a listing contract?

A1. Listing Contracts and their addendum are Multiple Listing Service forms.  These entities are separate and distinct from the Arizona REALTORS® and MLSs may choose to use, not use, or provide alternative forms in their discretion. Two separate forms were therefore needed to ensure that all REALTORS® across the state had access to an addendum that could be used to revise buyer representation agreements. As a result, the workgroup drafted a separate form titled the Buyer/Tenant Employment Agreement Addendum.

Q2. Cancellation is not a term of an agreement, why was it included in an addendum form?

A2. The workgroup felt cancellation of an agreement occurred often enough that it should be included in the addendum.  It therefore segregated the option to cancel from the revisions and titled it as a separate section to emphasize the distinction.

Q3. Why was the ability to add prerequisites to cancellation included?

A3. The workgroup felt a number of listing brokers include certain conditions upon cancellation, such as buyer exclusions, tail clauses, or representations of the seller (e.g. “I am no longer interested in selling the property”).  In such circumstances, the parties can include whatever specific conditions they want to facilitate their wishes. 

Aaron M. Green, Esq., a licensed Arizona attorney, is the General Counsel for the Arizona Association of REALTORS®.  This article is of a general nature and reflects only the opinion of the author at the time it was drafted.  It is not intended as definitive legal advice, and you should not act upon it without seeking independent legal counsel.

[1] Thank you to the Employment Contract Addendum workgroup for their efforts to revise this form and the Buyer/Tenant Employment Agreement Addendum.  The workgroup was chaired by Martha Appel.  Other workgroup members were Wednesday Enriquez, Serena Jones, and Mary Ann Shryack.