Agency Relationships

(Completely killing it on the intrigue level with that title)


The craziness of late summer closings and back to school mania means that this blog is coming to you a little late in my ‘blogging schedule’.


For some, the following may be considered late night reading to send you off to ‘Snoozeville’, but it’s an important read for those who just want a clearer understanding of our role and how we have to represent our clients, which is important knowledge to have if you are considering buying or selling with a Realtor.


So, when you start working with a realtor, in whatever capacity, the first thing that should be shown and explained to you is Agency Disclosure – we even have a little double sided document with a space for your autograph to ensure you understand all about it.


This document explains the 4 different types of Agency Relationship we work under, Buyer, Seller, Limited Dual, and Customer Status and how you should be represented in all four instances.


So what is Agency? What does it mean for you?

Agency describes “The relationship of trust between a Principle (the client) and an Agent, whereby an Agent is authorized by the Principle to act on his/her behalf. This contract can be created by conduct or contract – written or oral”


So who is an Agent?

The term Agent is used all too readily in the real estate world as a title for those who help people buy and sell real estate. This is incorrect. The fact is, licensed professionals who help people buy and sell real estate are actually SALESPEOPLE.


Salespeople are employed or otherwise authorized to trade on behalf of their respective AGENTS, also known as BROKERS.


Salespeople lack the legal capacity to trade on their own and are viewed as having an employee/employer relationship with the BROKER (AGENT).


Agency Duties

The substance of the agency relationship is that the Agent has the authority to represent the Client in a real estate transaction. The importance of a real estate transaction means that the Agent has to exercise discretion and judgment when carrying out duties on behalf of the Client, which means that in common law the Agent is also a fiduciary.


Hello…Are you still with me?


As your fiduciary, agents are obligated to protect and promote the interests of their clients as they would their own. Specifically, the Agent has the following fiduciary obligations:


Full disclosure

The Agent must inform the Client of all facts known to the Agent that might affect their relationship or influence the Client’s decision in a real estate transaction.

The Agent should not decide for the Client whether the particular information is important to the Client. We are obligated to disclose all relevant information.

The agent must inform the client of any conflicts of interest they might have in the course of providing services to the Client.



The Agent must act solely in the best interests of the Client, must always put the interests of the Client above the Agent’s own interests and above the interests of other parties. Among other things, this means avoiding conflicts of interest and protecting the Client’s position at all times.



The Agent has a duty to keep Client information private. Confidential information includes any information concerning the transaction, the Client, or the property that is not required by law to be disclosed, but which, if disclosed, could be used by another party to the disadvantage of the Client.


It is important to note that the duty of confidentiality continues even after the agency relationship ends.



So, when I stood there at the altar in my long white dress with family and friends looking on, I refused to obey my future husband and had the term omitted from my vows.

Being the good wife I am and true to my word, I have remained disobedient from that day on.

But in my working life I have to obey my clients with the word OBEY clearly written in our Agency Disclosure!

As long as instructions are reasonable and ordinary under the circumstances and in accordance with real estate transactions, the Agent must obey all lawful instructions of the Client.

If the Client asks the Agent to do something unlawful, the Agent has the right to terminate the agency relationship and any existing service agreement.


Reasonable Care and Skill

The Agent must exercise reasonable care, skill and diligence in performing all assigned duties. The Agent is expected to meet the standard of care that a reasonable and competent person would exercise in a similar situation.



The Agent must account for all money received as Agent for the Principle, be ready at all times to render complete accounting of it to the Principle.

The Principles money must be kept separate from the Agents money in a trust account.


So, if this blog has peaked your interest and you’re keen to know more and require further explanation and guidance regarding Agency Relationships and our role and obligations to you, you can give me a call or book a meeting to discuss in full without obligation.


Source: PEIREA

Photos: Canva

This article is not intended to solicit buyers or sellers currently in contract with other members of the PEIREA. Using this article in full or part without permission is a violation of copyright laws. Copyright © 2019 Melanie Press Real Estate.