Sarah is a salesperson at Beacon Realty in Boston. She has been working with buyer Marcus for several weeks, showing him properties and advising him on offers. Broker Beacon Realty also holds the listing for a condominium that Marcus now wants to purchase. Under Massachusetts law, what type of agency relationship has arisen?
Correct Answer
A) Dual agency, because the same brokerage now represents both the seller and the buyer
Under 254 CMR 3.00 and Massachusetts agency law, when a single brokerage represents both the seller (through a listing agreement) and the buyer (through a buyer representation agreement) in the same transaction, dual agency exists. This is because the brokerage owes fiduciary duties to both parties simultaneously, creating an inherent conflict of interest. Dual agency requires the informed written consent of both the buyer and the seller to be lawful in Massachusetts.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal obligation to reveal information that could affect a party's decision to enter into or the terms of a real estate transaction.
The extent of power and actions an agent is authorized to perform on behalf of the principal, as defined by the agency agreement.
The fiduciary obligations owed by a listing agent to the seller, including marketing the property, presenting all offers, and protecting the seller's confidential information.
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