Chapter 4: Broker Relationship & Ethics

Person Entrusted with another persons business

member of the public who is or may be a buyer or seller of real property

Two sales associates in same brokerage each representing the seller and buyer respectively

Position of trust or confidence for another

breach of contract/ trust

Authorized to perform only acts related to a business or to employment of a particular nature

ie property manager

licensees boasting property's benefits

defined as the sale of improved residential property of 4 or fewer units

• Represents the buyer or seller (not both)
• if they work with other agents- subagents

• Confidentiality
• Obedience
• Loyalty
• Disclosure (full)

• Deal Honestly and Fairly
• Account for all funds
• Skill Care and Diligence in the transaction
• Present all offers and counteroffers in a timely manner
• disclose all known facts that materially affect the value of residential real property and not readily observable to buyer

authorized to handle only a specific business transaction or a specific act

• CPA
• Single Agent Relationship

authorized by principal to perform all acts that the principal can personally perform and that may be lawfully delegated to another

ie- overseeing financial affairs, medical care, employment opportunities and living arrangements

• Common Law- Case law ; absolute Loyalty
• Statutory Law- rules enacted by legislatures and other governing bodies

Has limited fiduciary to buyer and seller and is working for the transaction

• Deal honestly and fairly
• Account for all funds
• Use Skill, care and diligence
• Disclose all known facts that are nor readily observable to buyer
• Present all offers and counter offers in timely manner
• Exercise limited confidentiality unless waved by a party
• Perform any additional duties that are mutually agreed to with a party

ILLEGAL

Acts in a full fiduciary capacity for buyer and seller

Disclosure requirements DO NOT apply to

• non residential transactions
• rental or leasing of real property
• auctions
• appraisals
• dispositions of any interest in business enterprises or bus opportunities

• Deal Honestly and Fairly
• Disclose all known facts
• Accounts for all funds

misstatement of fact or omission or concealment of a factual matter. can lead to fraud

• golden rule
• NAR's Code
• clients
• other brokers
• general public