What is the key element of an Override Clause?

The key element of an Override Clause is that it provides terms for payment after the expiration of a listing agreement. This clause is crucial because it outlines the conditions under which a listing agent may still receive a commission after the official agreement has ended, typically if the property is sold to a buyer who was introduced to the property during the listing period.

This provision protects the agent's right to compensation for their efforts in marketing and selling the property, even if the transaction occurs after the agreement has expired. It is a common feature in real estate contracts to ensure that agents are not entirely dependent on the duration of the listing agreement for their commission, preventing potential disputes regarding unpaid commissions after the listing period concludes.

Other aspects, such as specifying a duration for listing agreements or exclusively representing a seller, do not capture the essence of what an Override Clause fundamentally represents in real estate transactions. The fixed commission rate is a separate consideration related to compensation structures within agency agreements and is not inherently linked to the concept of an Override Clause.