A Licensee may not intend to create a dual agency – it may occur unintentionally or inadvertently. Some Leasing Agents lose sight of legal obligations when they focus intensely on bringing Renters and Landlords together. For example, a Licensee representing the Landlord might tell a buyer that the Landlord will accept less than the stated rent to entice the Renter into leasing the property. When an Agent for the Landlord gives a Renter any specific advice on how much to offer can lead the Renter to believe that the Leasing Agent represents the Buyer’s interests and is acting as the Renter’s Agent. The Leasing Agent is representing the Landlord then is involved in an UNDISCLOSED DUAL AGENCY, WHICH IS ILLEGAL.
Any of these actions create an implied agency with the Renter and violates the duties of loyalty and confidentiality to the principal – Landlord. Because neither party has been informed of that situation and been given the opportunity to seek separate representation, the interests of both are jeopardized. This undisclosed dual agency is a violation of licensing laws. It can result in rescission of the lease, forfeiture of commission, or filing of a suit for damages.
DISCLOSURE OF AGENCY
Licensees are considered to be representing the consumer they are working with as the consumer’s designated Agent, 28 / 84. unless there is a written agreement between them specifying a different relationship or if the Licensee is performing only ministerial acts on the consumers behalf.
Ministerial acts are defined as acts performed for a consumer that are informative or clerical in nature and do NOT rise to the level of creation of an agency relationship on behalf of a consumer.
Examples of ministerial acts include:
- Responding to phone inquiries by consumers as to the availability and pricing of brokerage services
- Responding to phone inquiries from a consumer concerning the price or location of property
- Attending an open house and responding to questions about the property from a consumer
- Setting an appointment to view property
- Responding to questions of consumers walking into a Licensee’s office, concerning brokerage services offered or particular properties
- Accompanying an Appraiser, Inspector, Contractor, or similar third party on a visit to a property
- Describing a property or the property’s condition in response to a consumer inquiry
- Completing business or factual information for a consumer on an offer or contract to purchase on behalf of a client
- Showing a client through a property being sold by an Owner on her own behalf
- Referring to another Broker or service provider
