The Law of Real Estate Agency
This pamphlet describes your legal rights
in dealing with a real estate broker or sales person. Please read it carefully
before signing any documents.
SECTION 1. Definitions. Defines the specific
terms used in the law
SECTION 2. Relationships between Licensees and
the Public . States that a licensee who works with a buyer or tenant represents
that buyer or tenant - unless the licensee is the listing agent, a seller's
subagent, a dual agent, the seller personally of the parties agree otherwise.
Also states that in a transaction involving two different licensees affiliated
with the same broker, the broker is a dual agent and each licensee solely represents
his or her client - unless the parties agree in writing that both licensees
are dual agents.
SECTION 3. Duties of a Licensee Generally. Prescribes
the duties that are owed by all licensees, regardless of who the licensee represents.
Requires disclosure of the licensee's agency relationship in a specific
transaction.
SECTION 4. Duties of a Seller's Agent. Prescribes
the additional duties of a licensee representing the seller or landlord only.
SECTION 5. Duties of a Buyer's Agent. Prescribes
the additional duties of a licensee representing the buyer or tenant only.
SECTION 6. Duties of a Dual Agent. Prescribes
the additional duties of a licensee representing both parties in the same transaction,
and requires the written consent of both parties to the licensee acting as a
dual agent.
SECTION 7. Duration of Agency Relationship.
Describes when an agency relationship begins and ends. Provides
that the duties of accounting and confidentiality continue after the termination
of an agency relationship.
SECTION 8. Compensation. Allows
brokers to share compensation with cooperating brokers. States that payment
of compensation does not necessarily establish an agency relationship. Allows
brokers to receive compensation from more than one party in a transaction with
parties' consent.
SECTION 9. Vicarious Liability. Eliminates
the common law liability of a party for the conduct of the party's agent of
subagent, unless the agent or subagent is insolvent. Also limits the liability
of a broker for the conduct of a subagent associated with a different broker.
SECTION 10. Imputed Knowledge and Notice. Eliminates
the common law rule that notice to or knowledge of an agent consitutes notice
to or knowledge of the principal.
SECTION 11. Interpretation. The law replaces the
fiduciary duties owned by an agent to a principal under the common law, to the
extent that it conflicts with the common law.
