Broker Lisa and Broker Kevin both work for Cornerstone Realty in Fort Wayne. Lisa has a listing agreement with seller David. Kevin is working with buyer Priya, who wants to purchase David's property. The managing broker assigns Lisa to represent David and Kevin to represent Priya exclusively. Under Indiana law, what type of agency relationship has been created?
Correct Answer
B) Designated agency, where each broker represents only one party within the same firm
Under IC 25-34.1-10, Indiana recognizes designated agency, which occurs when a managing broker assigns different brokers within the same firm to represent the seller and buyer respectively. In this arrangement, Lisa exclusively represents David and Kevin exclusively represents Priya, even though both work for the same brokerage. This avoids a true dual agency situation. The designated agency arrangement must be disclosed in writing to all parties.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A situation where a single agent or brokerage represents both the buyer and the seller in the same real estate transaction.
An agency relationship created by a clear, explicit agreement between the principal and agent, either orally or in writing.
The highest legal obligation of trust and confidence owed by an agent to their principal, requiring the agent to act solely in the principal's best interest.
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