Case Study: Recovering RM100,000 in Unpaid Commissions for a Real Estate Agency

Key Summary

• Background: A real estate agency sought recovery of ~RM100,000 in unpaid commissions from 3 property owners who had benefited from completed deals but refused to pay.

• Fee Structure: We acted on a Success Fee basis — no upfront legal fees unless recovery succeeded.

  
  

Case 1 – Near Limitation Deadline

• Debt: ~RM30k (since 2020, 1 year left before expiry).

• Debtor bankrupt. Guided client to file Proof of Debt and claim tax relief instead of futile litigation.

• ✅ Damage control, optimised recovery.

  
  

Case 2 – Panic Payment

• Debt: ~RM35k.

• Immediate panic upon receiving legal notice. Paid in full within 48 hours.

• ✅ Fast, stress-free recovery.

  
  

Case 3 – Silent Treatment

• Debt: ~RM35k.

• Ignored Notice of Demand. Prepared Writ of Summons. One day before filing, debtor paid in full.

• ✅ Full recovery without court.

  
  

Outcome:

• RM70k+ recovered in total.

• Client only paid legal fees upon success.

• Proper documentation for the uncollectible debt ensured clean books and tax relief.

  
  

Key Lesson: Unpaid commissions can be recovered strategically — sometimes with litigation, sometimes with pressure, and sometimes through smart write-off planning. Having a lawyer involved often makes the difference between being ignored and being paid.

Client Background

A well-known real estate agency approached us to recover approximately RM100,000 in unpaid commissions from three different property owners. These were commissions rightly earned through successful sub-sales — but the owners had bypassed our Client and refused to pay, even after benefiting from the deals.

Our Fee Structure

We acted on a Success Fee basis: ✅ No upfront legal fees unless we recovered. ✅ Low risk for our client, high pressure on defaulters.

Here’s how each case unfolded.

Case 1: Chasing a Debt Close to Limitation Deadline

• Debt amount: ~RM30,000

• Commission due since: 2020

• Time left before 6-year limitation expired: 1 year
  

Upon conducting an e-Insolvensi search, we discovered that the property owner had been declared bankrupt years ago.

▶️ Our advice: Instead of wasting time chasing an uncollectible debt, we helped the client file a Proof of Debt with Jabatan Insolvensi, in hopes of participating in any potential asset distribution.

Additionally, we supplied the necessary legal documentation to:

• Write off the invoice as bad debt, and

• Reclaim the tax portion from LHDN

✅ Result: Realistic damage control. No futile litigation. Optimised tax recovery.

Case 2: Immediate Panic, Immediate Payment

• Debt amount: ~RM35,000

As soon as we contacted the property owner and informed him we were acting for the agency, he panicked.

We missed five calls in a row, followed by a frantic message:

“Boss, I am so sorry, please... which account do I pay to?”

✅ Result: Paid in full within 48 hours of first contact. Moral of the story: Some people really do fear legal letterheads.

Case 3: Silent Treatment — Until the Final Hour

• Debt amount: ~RM35,000

This was more of a standard debt recovery pattern. We issued a Notice of Demand, followed by two weeks of ignored follow-ups.

So we prepared a Writ of Summons. One day before it was due to be filed in court, we received a message with a full payment banking slip attached.

✅ Result: Case resolved with no court filing required. ✅ Client recovered in full.

Outcome Summary

• Total commissions recovered: ~RM70,000+

• Legal fees payable only upon successful recovery

• Client able to close the books on all 3 files — with proper documentation for the one uncollectible case
  

Key Takeaway

Unpaid commissions and service fees can be recovered — even years later — when handled strategically. Not every case requires court action. But having a lawyer involved often makes the difference between being ignored and being paid. AUTHOR PROFILE

Rudi Cheu is the principal of Rule & Co. Advocates & Solicitors; a Malaysian law firm focusing on practical and cost-effective solutions for debt recovery and commercial disputes. With nearly a decade of debt recovery experience under his belt; Rudi is passionate about helping businesses navigate debt recovery challenges and shares insights at www.rulecolaw.com/blog and recoverdebt.my

He can be reached via Whatsapp: +60102028095 or via email: rudi@rulecolaw.com