An agency may be terminated for any of the following reasons:

  • Death or incapacity of either party
  • Destruction or condemnation of the property
  • Expiration of the terms of the agency
  • Mutual agreement by all parties to the contract
  • Breach by one of the parties, in which case the breaching party might be liable for damages
  • By operation of law, as in bankruptcy of the principal (bankruptcy terminates the agency contract, and title to the property transfers to a court-appointed receiver)
  • Completion, performance, or fulfillment of the purpose for which the agency was created

In Illinois, a definite termination date must be included in a brokerage agreement.

Automatic extension clauses are illegal under Illinois law.