There’s always something to howl about.

Location, location, location: Refusing Dual Agency puts Realtors above reproach . . .

I may have stirred up a hornet’s nest on the subject of No Dual Agency. Jim Duncan at Real Central VA posted his thoughts, and the sellsius° real estate blog posted a round-up, asking Are Buyers Customers or Clients? From Arizona, taking a trip Back East is also taking a trip back in time: Agency as it is understood in New York has been absent from this remote cultural backwater for at least 15 years.

That’s as may be. I work in Arizona. Plus which, if seller sub-agency is not already in the past in your state, buyer agency is definitely in your future. There’s a new sheriff in town.

This is all to the good, by me. The slim justification for our licenses is consumer protection, and it seem obvious to me that exclusive representation is the only way to achieve truly transparent protection for both of the parties to a real estate transaction.

Ardell DellaLoggia, in comments posted here, seems to disagree:

Due to the internet access of homes for sale, the trend is UP and not DOWN with regard to buyers calling listing agents direct vs. seeking separate and distinct representation. When the Buyer Consumer chooses to call the listing agent, if you outlaw Dual Agency, you leave them with NO representation at all.

It sounds good to say “outlaw Dual Agency”, but it leaves the Buyer Consumer back where they started, if and when they call the listing agent direct, with NO representation whatsoever.

I see that as a false dichotomy. In that circumstance, the listing agent can either refer the buyer to one of several trusted buyer’s agents (we do this) or simply advise the buyer to seek separate representation. The Buyer’s Broker’s commission is already built in to the MLS listing. There is no reason for the buyer not to seek representation.

Prove my point, Greg. Buyer calls you on your listing and only wants to deal with you personally when making an offer on your listing. Where do you go with that scenario if Dual Agency is “outlawed”, without leaving the buyer high and dry with regard to representation in the transaction at hand?

What should your attorney do, in a lawsuit you brought, if the respondent insists on representation by your lawyer and your lawyer only? Looked at another way, what should you do if, in working with a customer, you realize you are dealing with a rabid racist? Except where an agent creates an implied agency, representation is a bi-lateral agreement. If the risks of Dual Agency are explained properly, buyers will jump at the chance to have separate representation. Even if they don’t want to do it, they have to with our brokerage. Disclosed Dual Agency is still lawful in Arizona, but BloodhoundRealty.com forbids Dual Agency as a matter of brokerage policy.

In linguam Latinam, the term for a wild-eyed revolution is rei novi — new things. I was amazed to discover that sub-agency still exists anywhere in the United States. I agree with Ardell that Designated Agency is as much a fig leaf as Disclosed Dual Agency. Both — as with most real estate laws — are devised to protect the broker, not the consumer. From the point of view of a random juror, schooled by fifty years of television to believe that all commerce is crime, if there is even a hint of a possibility that collusion was possible, it’s a slam dunk verdict for the plaintiff.

And while the order of precedence should be reversed, statute law trumps ethics and court judgments trump statute law. What we do (at least in Arizona) is a subset of the practice of law, so it is not at all untoward to ask, “Would an attorney do this, in this situation?”

But if the answer to that question proves nebulous, here’s a much better one: “In a lawsuit brought by one (or both!) of my clients, in what light would a plaintiff’s attorney attempt to portray my actions?”

This is not an academic question. The judgments awarded in Dual Agency lawsuits are huge. The safest answer for a Realtor to make, whether from ethics, from policy, from statute law or from the naked fear of voracious lawyers is simply this: “Caesar’s wife must be above reproach.”

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