Based on the 2026 Supreme Court of Nigeria ruling in Ojo v. SDV Nigeria Ltd & Anor, an estate agent is not entitled to commission merely by introducing a buyer or tenant to a property. The agent must prove their action was the “effective cause” of the transaction, rather than simply providing information.
Key Takeaways on Agency Fees (Nigeria Supreme Court 2026):
- Effective Cause Rule: To claim commission, the agent must be the “proximate and effective” cause of the completed transaction (e.g., active involvement in negotiations).
- No Automatic Entitlement: Mere introduction or unsolicited provision of information does not create a legal obligation to pay commission.
- Importance of Agreements: A valid agency agreement, either written or strongly inferred, is necessary to support a commission claim.
- Unsolicited Information: Parties are free to act on information provided by an agent without incurring liability to pay commission.
This ruling, which dismissed a 19-year legal dispute, emphasizes that commission is earned through active, professional engagement in finalizing a deal, not just initiating contact.
Source; Business News Nigeria, Instagram otl_law.