Following a September 18 rulemaking hearing, the Real Estate Commission at its November 6 meeting approved amendments to its rule on agency agreements and disclosure (Rule A .0104).
The amendments enable real estate firms in dual agency transactions "to designate" one or more of its brokers or salesmen to represent the buyer, and another or other brokers or salesmen to represent the seller.
The amendments also provide that an individual broker or salesman, when representing both the buyer and seller in the same transaction, may (with the written consent of the buyer and seller) withhold any information about a party which that party has identified as confidential, unless disclosure is required by statute or rule.
Following is the complete text of the rule amendments (subsections i-n) which will become effective July 1, 1997 if approved by the General Assembly:
"(i) A firm which represents both the buyer and the seller in the same real estate sales transaction is a dual agent and through the brokers and salesmen associated with the firm shall disclose its dual agency to the buyer and seller.
(j) When a firm represents both the buyer and seller in the same real estate sales transaction, the firm may, with the prior written approval of its buyer and seller clients, designate one or more individual brokers or salesmen associated with the firm to represent only the interests of the seller and one or more other individual brokers and salesmen associated with the firm to represent only the interests of the buyer in the transaction. An individual broker or salesman shall not be so designated and shall not undertake to represent only the interests of one party if the broker or salesman has actually received confidential information concerning the other party in connection with the transection. A broker-in-charge shall not act as a designated agent for a party in a real estate sales transaction when a salesman under his supervision will act as a designated agent for another party with a competing interest.
(k) When a firm acting as a dual agent designates an individual broker or salesman to represent the seller, the broker or salesman so designated shall represent only the interest of the seller and shall not, without the seller's permission, disclose to the buyer or a broker or salesman designated to represent the buyer:
(1) that the seller may agree to a price, terms, or any conditions of sale other than those established by the seller;
(2) the seller's motivation for engaging in the transaction unless disclosure is otherwise required by statute or rule; and
(3) any information about the seller which the seller has identified as confidential unless disclosure of the information is otherwise required by statute or rule.
(l) When a firm acting as a dual agent designates an individual broker or salesman to represent the buyer, the broker or the salesman so designated shall represent only the interest of the buyer and shall not, without the buyer's permission, disclose to the seller or a broker or salesman designated to represent the seller:
(1) that the buyer may agree to a price, terms, or any conditions of sale other than those offered by the buyer;
(2) the buyer's motivation for engaging in the transaction unless disclosure is otherwise required by statute or rule; and
(3) any information about the buyer which the buyer has identified as confidential unless disclosure of the information is otherwise required by statute or rule.
(m) A broker or salesman designated to represent a buyer or seller in accordance with Section (b) of this Rule shall disclose the identity of all of the brokers and salesmen so designated to both the buyer and the seller. The disclosure shall take place no later than the presentation of the first offer to purchase or sell.
(n) When an individual broker or salesman represents both the buyer and seller in the same real estate sales transaction pursuant to a written agreement authorizing dual agency, the parties may provide in the written agreement that the broker or salesman shall not disclose the following information about one party to the other without permission from the party about whom the information pertains:
(1) that a party may agree to a price, terms or any conditions of sale other than those offered;
(2) the motivation of a party for engaging in the transaction, unless disclosure is otherwise required by statute or rule; and
(3) any information about a party which that party has identified as confidential, unless disclosure is otherwise required by statute or rule."