Frequently Asked Questions

Legal Hotline FAQ

A blog of the most frequently asked questions to the Maryland REALTORS Legal Hotline.

Sandi Frazer
Sandi Frazer
Sandi Frazer's Blog

Q: I am the broker for a small company and I still take listings. If another agent in my office has a buyer client interested in my listing, how can we make dual agency work?

A: First, some background.  For this analysis, we assume both buyer and seller have executed written brokerage agreements and signed the Consent for Dual Agency form published by the Maryland Real Estate Commission.  A real estate company needs at least three licensees to participate in dual agency.   Only a broker or branch office manager designated by the broker may act as a dual agent and the dual agency provisions of the Maryland Real Estate Brokers Act must be complied with. 

Once the dual agency form is executed, the broker or the broker’s designee becomes the dual agent.  The dual agent assigns one real estate agent from the company to represent the seller.  This person is the seller’s intra-company agent.  The dual agent assigns another agent from the company to represent the buyer.  This agent is the buyer’s intra-company agent.  The intra-company agents must provide the same services to their clients as an exclusive seller’s or buyer’s agent, including advising their clients as to price and negotiation strategy.

If either the buyer or seller refuses to consent in writing to the dual agency, the broker may withdraw from representing the client who refuses to consent.  The withdrawal may not prejudice the ability of the licensee to continue to represent the other client in the transaction nor to limit the licensee from representing the client who refused to consent to dual agency in transactions not involving dual agency.

A broker who is also the listing agent may not act as the intra-company agent for the seller.  As mentioned above, assuming both parties have signed the Consent to Dual Agency form, the broker or designee is the “dual agent” in the transaction. The designee must be a manager who already has supervisory responsibilities.  That person then assigns one licensee affiliated with the firm to be the intra-company agent for the seller and assigns another licensee at the firm to be the intra-company agent for the buyer. Because you are the broker, even if you designate the branch manager to act as the dual agent, that person may not appoint you to be an intra-company agent.  

That said, there are 2 ways to make dual agency work in this situation.  The first is for the broker to assign the listing to another agent in the office, take on the role of the dual agent and assign the other agent as the intra-company agent representing the seller.  As a practical matter this may not be ideal, especially if the broker, because of some particular expertise, is the reason the firm obtained the listing in the first place.  

The second way to make it work is to avoid dual agency for this property.  As noted above, if the buyer refuses to consent to dual agency for this property, your company may withdraw your representation of the buyer, continue to represent the seller, and offer to assist the (now unrepresented) buyer as the seller’s agent.  You must be careful to perform only “ministerial acts” on behalf of the buyer.

Finally, dual agents and intra-company agents must keep confidential information about a client’s bargaining position or motivations unless the client gives written consent to disclose the information.  However, like all agents, a dual agent and an intra-company agent must disclose any material facts about a property to the other party. 

Comments are closed.