Understanding the Fine Line Between Comparison Shopping and Jumping Orders
In the competitive world of real estate, the practice of switching agents after multiple property viewings often raises legal questions. Was it legitimate comparison shopping or an unethical ‘jumping orders’ violation? Recent court cases across China have brought clarity to this complex issue, establishing important precedents for buyers, sellers, and agents alike.
The fundamental question revolves around whether a client substantially utilized an agent’s services before circumventing them to avoid paying commissions. This distinction matters greatly in transactions involving significant financial stakes, sometimes involving millions of yuan.
What Exactly Constitutes Jumping Orders?
Jumping orders occurs when a client uses an agent’s services, information, or negotiation efforts but then deliberately bypasses that agent to complete a transaction directly with the property owner or through another agent. This practice deprives the original agent of rightfully earned commissions after they’ve invested time, resources, and expertise.
The legal foundation for addressing jumping orders comes from Article 965 of China’s Civil Code, which states: ‘Where the principal, after accepting the intermediation service, circumvents the intermediary and directly concludes a contract through the opportunities or媒介 services provided by the intermediary, the principal shall pay remuneration to the intermediary.’
Key Elements of Jumping Orders
Chinese courts typically evaluate three critical elements when determining whether jumping orders occurred:
– Acceptance of intermediary services: The client must have knowingly received and utilized the agent’s services
– Utilization of transaction opportunities or媒介 services: The client must have used specific information, access, or negotiations provided by the agent
– Circumvention of the intermediary: The client must have intentionally bypassed the agent who provided these services
Recent Court Cases Shed Light on Legal Standards
The Jiangyou City case from Sichuan Province illustrates a clear instance of jumping orders. In this 2025 case, Mr. Li actively contacted agency employee Mr. Li Hua, who provided specific property information and arranged a viewing. Months later, Mr. Li directly negotiated with the property owner at a lower price, completely bypassing the agent who had facilitated the initial connection.
The court determined that even without a written contract, an intermediary relationship existed based on their interactions. Mr. Li had substantially utilized the agent’s services and information, making his direct transaction a clear case of jumping orders. However, the court proportioned the commission based on services actually rendered, awarding only 1,660 yuan instead of the full fee.
The Beijing Case: When Comparison Shopping Is Legitimate
In contrast, a Beijing case demonstrates legitimate comparison shopping. A company viewed nine properties through one agency over seven days, even signing a viewing confirmation with a no-jumping clause. However, they ultimately used a different agent to lease a property at a higher price than what the first agent had negotiated.
The court ruled this wasn’t jumping orders because: the property was non-exclusive (available through multiple agencies), the first agent hadn’t progressed to substantial price negotiations, and the client paid more through the second agent—demonstrating no intention to avoid commissions. This case followed the precedent set by the Supreme People’s Court’s 2011 guiding case (Shanghai Zhongyuan Property v. Tao Dehua).
How Courts Distinguish Between Jumping Orders and Legitimate Comparison
Chinese courts have developed consistent criteria for evaluating these situations. The primary consideration is whether the client ‘substantially utilized’ the agent’s services beyond basic property information readily available elsewhere.
Substantial utilization typically involves:
– Exclusive or hard-to-obtain property information
– Detailed price negotiations conducted by the agent
– Special access arrangements or unique insights provided
– Customized market analysis or transaction structuring
When properties are listed with multiple agencies (non-exclusive listings), clients generally have more freedom to choose among competing agents. However, they cannot use one agent’s specialized work product—such as negotiated terms or proprietary analysis—to benefit another agent without compensation.
The Celebrity Case: When High Profiles Don’t Mean High Liability
In 2023, a high-profile case involving celebrity夫妇 and a 60 million yuan property transaction resulted in a ruling favoring the buyers. The court found no jumping orders occurred because the agency couldn’t prove the celebrities knew they’d incur liability simply by viewing properties, especially since the property wasn’t exclusively listed with that agency.
This case emphasized that without clear agreements or understanding of potential liabilities, basic property viewing doesn’t automatically create intermediary relationships that restrict future choices.
Practical Guidance for Buyers, Sellers, and Agents
For buyers and tenants, transparency is the best policy. If you’re working with multiple agents, consider informing them upfront. Document your decision-making process, especially if you choose a different agent for legitimate reasons like better terms, lower fees, or superior service.
For agents, protection comes from clear documentation. Well-drafted viewing confirmations, detailed service records, and evidence of unique contributions strengthen your position. The Guangzhou villa case demonstrated how exclusive listing agreements provide stronger protection against jumping orders.
Documentation That Makes a Difference
Agents should maintain:
– Signed viewing confirmations with clear terms
– Detailed records of property information provided
– Evidence of price negotiations and transaction structuring
– Communication records showing client engagement
– Proof of exclusive listings when applicable
These documents help establish whether services went beyond basic property access and entered the realm of substantial utilization that deserves compensation.
Regional Variations in Court Interpretations
While national laws provide framework, regional courts sometimes emphasize different aspects. The Liaoning Anshan case emphasized that even without written contracts, substantial services like price negotiation created entitlement to commissions. The Guangzhou case highlighted how exclusive listings create stronger protections against jumping orders.
These variations mean participants should understand local legal trends and possibly seek local legal advice for significant transactions.
Essential Takeaways for Real Estate Participants
The line between jumping orders and legitimate comparison shopping depends on the substance of services provided and the client’s intentions. Clients have the right to choose among competing agents, but not to misappropriate one agent’s work product for another’s benefit.
Agents deserve compensation for substantial services that directly contribute to transactions. Courts increasingly focus on the quality and exclusivity of services rather than mere property access.
Clear communication and documentation protect all parties. Buyers should understand their obligations, while agents should clearly document their contributions. When in doubt, consult legal professionals familiar with real estate intermediation laws in your jurisdiction.
For personalized advice regarding specific situations, consult with qualified legal professionals who can analyze your unique circumstances against current jurisprudence and local regulations.