Legally speaking: Agency status for brokers when listing; representing buyers
On September 14, 2015
By Peg Ritneour, OAR Vice President of Legal Services/Administration
The OAR Legal Assistance Hotline receives an array of real estate-related legal questions — including license law issues, disclosure, contract law, ethics and commission problems, among others. In an effort to help you work within the law, our “Legally Speaking” series spotlights some of the timely questions that are being asked by REALTORS. The following are some commonly asked questions pertaining to agency status brokers may encounter…
Q: I am a broker for my company. Although running the brokerage keeps me busy, I still occasionally take a listing in my individual capacity. What happens if I personally list a property and one of my agents represents the buyer? Under my brokerage’s agency policy we do practice “split” agency, but since I am the broker do I have to be a dual agent?
A: Under Ohio license law you are bound by the agency relationships created by your affiliated agents. However the license law was amended several years ago to provide for a limited exception in the scenario you have described — but only if there is another broker or management level licensee affiliated with your brokerage who can supervise the agent representing the buyer. If you have another broker or management level licensee in your brokerage who can do this, then you are permitted to just represent the seller and your agent can represent the buyer.
However, if you are the sole broker and there is no other management level licensee in your brokerage to supervise the buyer’s agent, then you must act as a dual agent.
Q: In the above scenario, I will have to be a dual agent since I don’t have another broker in the company who can supervise the agent representing the buyer. Does the buyer’s agent have to be a dual agent too?
A: No, that agent can represent just the buyer.
Q: I understand that as a dual agent I will not be able to advocate or negotiate for the seller. If my seller wants full representation can another agent in the brokerage be appointed to represent the seller?
A: Yes, with the seller’s agreement that can be done. Of course as the sole broker, you will remain a dual agent in the transaction since both seller and buyer will be represented by agents in your brokerage.
Q: As a broker if I personally represent a buyer who wants to purchase a property listed by one of my agents, are the above answers the same?
A: Yes. You could continue to represent only the buyer if there is another broker or management level licensee affiliated with your brokerage who can supervise the listing agent. If there isn’t you would have to be a dual agent, while the listing agent would represent just the seller.
Tags: legal, Legally Speaking