"A review of the discussions on the bill in the Knesset's Economic Affairs Committee shows that the basis of the amendment was primarily a consumer purpose, namely to ensure the interests of the customer entering into an exclusivity agreement and to prevent its exploitation, along with the desire to ensure certainty and uniformity in the implementation of the Brokers Law in the courts in situations of exclusivity, profits in the market (see: Minutes of Session No. 148 of the Economic Affairs Committee, 16th Knesset, 3-2 (9.2.2004). See also: The Real Estate Brokers Bill (Amendment No. 4) (Limitation of the Exclusivity Period), 5764-2004, H.H. 62 (hereinafter: the Real Estate Brokers Bill (Amendment No. 4)). Accordingly, Amendment No. 4 anchored a number of restrictions on the possibility of acting as an exclusive intermediary."
(Emphasis is not in the original - A.H.).
- Thus, both the exclusivity agreement signed between the parties and the Realtors Law defined exclusivity as the client's obligation to hand over the marketing of the property to the sole care of the realtor, in a manner that obligates the client to pay the broker the brokerage fees that were agreed upon, in our case 2% plus VAT, for every transaction they signed during the exclusivity period (provided that the realtor performed marketing activities).
This is the meaning of exclusivity.
- Admittedly, in clause 2 of the exclusivity agreement, the defendants undertook, inter alia, to refer any potential buyer to the plaintiff. Indeed, in clause 3 of the exclusivity agreement, it was determined that the defendants were aware that the plaintiff would charge the buyer a brokerage fee, and therefore in the event of a breach of clause 2, the defendants would pay agreed compensation in the amount of 2% plus VAT. However, this is not enough to substantiate the plaintiff's claim that he is entitled to the agreed compensation because the defendants did not refer the buyers to him. In my opinion, in view of the other provisions of the exclusivity agreement quoted above (sections 2 and 7 of the exclusivity agreement) together with the provisions of the Realtors Law that were cited above, the provision in the exclusivity agreement that obligates the defendants to refer to the plaintiff any potential buyer should be interpreted as intended to ensure the defendants' undertaking to market the property through the plaintiff and to pay him the brokerage fees as they undertook. The buyer's referral to the plaintiff is intended to ensure that the defendants will not bypass the plaintiff and enter into the transaction without informing him. The referral also increases the plaintiff's chances of promoting a transaction and receiving the plaintiff's brokerage fees in respect of it.
- The meaning of exclusivity is not an undertaking by the customer that the buyer will also enter into a brokerage agreement with the broker (a matter that is in any case not under the control of the client); Exclusivity does not mean that the customer is charged an additional brokerage fee by the buyer, in the event that the buyer does not enter into a brokerage agreement with the broker; The meaning of exclusivity is not a commitment by the client to a brokerage fee of 4% plus VAT; Exclusivity does not mean a commitment by the client to enter into a transaction only with a buyer who is willing to pay the broker a brokerage fee.
Therefore, a breach of the exclusivity agreement cannot grant the plaintiff the right to receive the additional 2%, which he is not entitled to receive by virtue of the agreement in any case.