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Regulation Text

Section 13. Relationships with real estate brokers and salespeople:

(a) Agency disclosure for real estate agents representing the seller or buyer.

A real estate broker or salesperson shall provide to a prospective purchaser or seller of real estate a notice developed and approved by the board which clearly discloses the relationship of the broker or salesperson with the prospective purchaser or seller of the real estate. The notice, developed by the Board, shall be provided to a prospective purchaser or seller at the time of the first personal meeting between the prospective purchaser or seller and the broker or salesperson for the purpose of discussing a specific property.

(1) A broker or salesperson shall request a prospective purchaser or seller to sign and date such notice, provide the original to the prospective purchaser or seller and maintain a copy with their records for a period of three years from the date on the notice. The broker or salesperson must also sign the notice, indicate their license status as either a broker or salesperson, provide their license number and date such notice.

(2) If a prospective purchaser or seller declines to sign the notice the broker or salesperson shall make a notation indicating the date the notice was given to the prospective purchaser or seller and that the prospective purchaser or seller declined to sign it. The broker shall maintain such notice for a period of three years from the date on the notice.

(3) Nothing herein shall require written notice to each prospective purchaser or seller who comes to an open house showing of real property provided, however, the broker or salesperson, by sign, poster, distributed listing literature or property description form conspicuously discloses any pre-existing agency relationship. Where the listing literature or property description form is distributed at an open house the written disclosure of the agency relationship therein shall be more conspicuous than any other written material.

(4) All such records and notices are subject to inspection by the Board or its agents.

(b) Consensual dual agency disclosure.

This section applies to real estate brokers or salespeople engaged in the purchase or sale of land with a building intended for use as a one to four unit residential dwelling or the purchase or sale of land on which a building is intended to be constructed for use as a one or two unit residential dwelling. A real estate broker or salesperson may act as an agent for both a seller and prospective purchaser of real estate provided that the broker or salesperson obtains informed written consent from both the seller and the prospective purchaser. The real estate broker or salesperson shall provide a written consent form which shall clearly state that the broker or salesperson will be representing both the seller and prospective purchaser in the purchase and sale of real property. The consent form must also state that a dual agent assists the seller and buyer in a transaction but shall be neutral with regard to any conflicting interest of the seller and buyer. Consequently, the consent form must state that a dual agent will not have the ability to satisfy fully the duties of loyalty, full disclosure, reasonable care and obedience to lawful instructions, but shall still owe the duty of confidentiality of material information and the duty to account for funds. The consent form must provide that material information received from either client that is confidential may not be disclosed by a dual agent, except:

(1) if disclosure is expressly authorized;

(2) if such disclosure is required by law;

(3) if such disclosure is intended to prevent illegal conduct; or

(4) if such disclosure is necessary to prosecute a claim against a person represented or to defend a claim against the broker or salesperson. Lastly, the consent must state that the duty of confidentiality shall continue after termination of the brokerage relationship.

1. A broker or salesperson shall obtain the signature of the seller or prospective purchaser on one or more of such consent forms, provide the original forms to the seller and prospective purchase and maintain a copy with their records for a period of three years from the date on the form. The broker or salesperson must also sign the consent form, indicate their license status as either a broker or salesperson, provide their license number and date such form. Nothing herein shall require the seller and prospective purchaser to sign the same consent form.

2. There shall be a conclusive presumption that the seller or prospective purchaser has consented to dual agency if they have signed a form that contains the description in paragraph (b), above, indicating consent to that relationship. Consent may be given by a seller in a written agreement to list their property for sale with a real estate agent; by a prospective purchaser in a buyer representation agreement; or in another document signed either before or after a potential transaction between a seller and prospective purchaser has been identified. When consent to dual agency has been given by a seller or prospective purchaser in advance of the identification of a potential transaction, written notice of dual agency must also be given by the broker or salesperson to the seller and prospective purchaser after a transaction has been identified stating that the broker is dual agent with regard to the transaction. Written notice of dual agency shall satisfy section 13(b) herein and such written notice shall be given prior to the seller and prospective purchaser entering into a written agreement for the purchase or sale of residential property.

3. Nothing herein shall require written notice to each prospective purchaser or seller who comes to an open house showing of real property provided, however, the broker or salesperson, by sign, poster, distributed listing literature or property description form conspicuously discloses any pre-existing agency relationship. Where the listing literature or property description form is distributed at an open house the written disclosure of the agency relationship therein shall be more conspicuous than any other written material.

4. All such records and notices are subject to inspection by the Board or its agents.

(c) Designated agency disclosure.

This section applies to real estate brokers or salespeople engaged in the purchase or sale of land with a building intended for use as a one to four unit residential dwelling or the purchase or sale of land on which a building is intended to be constructed for use as a one or two unit residential dwelling. A real estate broker or salesperson may appoint one or more affiliated brokers or salespersons to represent the seller, provided the seller gives written consent after being advised that

(a) the designated seller's agent will represent the seller and will owe the seller the duties of loyalty, full disclosure, confidentiality, to account for funds, reasonable care and obedience to lawful instruction;

(b) all other licensees affiliated with the appointing broker will not represent the seller nor will they have the other duties specified herein to that seller, and may potentially represent the purchaser; and

(c) if designated agents affiliated with the same broker represent the seller and purchaser in a transaction, the appointing broker shall be a dual agent and neutral as to any conflicting interests of the seller and purchaser, but will continue to owe the seller and purchaser the duties of confidentiality of material information and to account for funds.

Conversely, a real estate broker or salesperson may appoint one or more affiliated brokers or salespersons to act as a designated agent on behalf of a prospective purchaser, provided the purchaser gives written consent after being advised that;

(a) the designated buyer's agent will represent the purchaser and will owe the purchaser the duties of loyalty, full disclosure, confidentiality, to account for funds, reasonable care and obedience to lawful instruction;

(b) all other licensees affiliated with the appointing broker will not represent the purchaser nor will they have the other duties specified herein to that purchaser, and potentially may represent the seller; and

(c) if designated agents affiliated with the same broker represent the seller and purchaser in a transaction, the appointing broker shall be a dual agent and neutral as to any conflicting interests of the seller and purchaser, but will continue to owe the seller and purchaser the duties of confidentiality of material information and to account for funds.

There shall be a conclusive presumption that a seller or purchaser has consented to a designated agency relationship, if they have signed a consent form that substantially contains the description of designated agency set forth in Section 13(c) herein. If the designated seller's agent and designated buyer's agent in a transaction are affiliated with the same broker and the seller and purchaser each have consented to designated agency, a separate consent to dual agency of the appointing broker shall not be required.

Consent to designated agency may be given by a seller in a listing agreement; by a purchaser in a buyer representation agreement or by either the seller or purchaser in a separate consent form that substantially contains the description of designated agency set forth in Section 13(c) above. The form may be signed either before a potential transaction between a seller and purchaser is identified or when it is identified but, in any event, no later than prior to the execution of a written agreement for the purchase or sale of residential property. If consent to designated agency has been given by the seller or purchaser in advance of the identification of a potential transaction, the broker or salesperson shall also provide written notice to the seller and prospective purchaser of designated agency. The broker or salesperson shall also provide written notice. Such written notice shall be given prior to the seller or purchaser entering into a written agreement for the purchase or sale of a residential property. Such written notice for designated agency shall satisfy section 13(c) above.

(1) The designated real estate broker or salesperson exclusively represents the seller or purchaser and is responsible for the performance of any duties owed to the seller or purchaser. The designated broker or salesperson may not share known or acquired information with any other real estate agent or person that would harm the seller's or purchaser's interest in the real estate transaction, except for known material defects in real property. The designated broker or salesperson shall have an affirmative obligation to disclose known material defects in real property.

(2)Appointment by a broker or salesperson of another affiliated broker or salesperson to represent a seller or purchaser shall not limit the liability or responsibility of the appointing broker or salesperson for any breach of duty by the designated broker or salesperson. The appointment of the broker or salesperson to represent the seller or purchaser shall extend only to those brokers or salespersons so appointed by the appointing broker or salesperson and consented to by the seller or purchaser.

(3) An appointing broker or salesperson who designates another affiliated broker or salesperson to represent the seller and an affiliated broker or salesperson to represent the purchaser shall be presumed to be a dual agent, provided that the seller and purchaser consent to such designation. The designated broker or salesperson must comply with the requirements set forth in Section (13)(a)(1) through (4) herein provided, however, that notice must be provided when such designation is established or at the execution of an agreement to advertise for sale the real property of the seller and when an offer to purchase is submitted by the purchaser, whichever is sooner.

(d) Sub-agency representation.

No broker or salesperson shall enter into an agreement with any other broker or salesperson to represent a seller or purchaser as a secondary or sub-agent without informing such seller or purchaser in writing that the secondary or sub- agent's actions may subject the seller or purchaser to vicarious liability. The broker or salesperson shall provide written notice containing the information of potential vicarious liability and obtain the seller's or purchasers consent on such notice to secondary or sub-agency.

The written notice must state that the broker may cooperate with another broker who is then a sub-agent of the seller or buyer. The written notice must further state that vicarious liability is the potential for a seller or buyer to be held liable for a misrepresentation or an act or omission of the sub-agent And that the seller or buyer authorizes the broker or salesperson to offer sub-agency in signing the notice.

The broker or salesperson shall provide such notice at the execution of an agreement to sell the real property of the seller or when the agent and purchaser agree that the agent will represent such purchaser. This Section applies to real estate brokers or salespeople engaged in the purchase or sale of land with a building intended for use as a one to four unit residential dwelling or to the purchase or sale of land on which a building is intended to be constructed for use as a one or two unit residential dwelling.

(e) Non-agent facilitator.

Nothing herein shall prohibit a broker or salesperson from working with a seller or purchaser in such capacity where the broker or salesperson does not represent them as a sole, designated or dual agent provided written notice of such representation is provided.

The notice must state that no agency relationship exists between the facilitator and the seller or purchaser. The notice must be provided at the first personal meeting to discuss a specific property. A facilitator has a duty to present all real property honestly and accurately, disclosing known material defects and accounting for funds. The facilitator does not have a duty of confidentiality with regard to any information received from the seller or purchaser. A facilitator may also be called a transaction broker or salesperson and a facilitator relationship may be changed to an agency relationship provided for in this regulation with the written agreement of the person so represented.

Untitled Document
 
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