Broker Chen at Harbor Real Estate listed a home for the Garcias. Later, buyer Tom Davis signed a buyer representation agreement with the same brokerage. Tom wants to purchase the Garcias' home. Broker Chen explains the dual-agency situation to both parties, but only the Garcias sign the written dual-agency consent form. Tom says he is fine with it verbally. Under Michigan law, what is the status of this dual-agency arrangement?
Correct Answer
B) The arrangement is invalid because both parties must provide informed written consent under MCL 339.2517
MCL 339.2517 requires informed written consent from both the buyer and the seller before a broker may act as a dual agent. Tom's verbal agreement does not satisfy the statutory written-consent requirement. Without Tom's written consent, the dual-agency arrangement is not properly authorized under Michigan law, and the broker risks disciplinary action.
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Related Topics & Key Terms
Key Terms:
Related Concepts
In real estate, a client is someone to whom the agent owes fiduciary duties through an agency relationship, while a customer is a third party to whom the agent owes only honesty and fair dealing.
An arrangement where a brokerage assigns separate agents within the firm to represent the buyer and seller in the same transaction, allowing each client to have dedicated representation.
A situation where a single agent or brokerage represents both the buyer and the seller in the same real estate transaction.
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