South Dakota salesperson Tom represents buyer client Helen. Tom's broker, Broker Gail, also has a listing for a property that Helen wants to purchase. Broker Gail assigns salesperson Tom to continue representing Helen and assigns salesperson Rita to represent the seller. Tom and Rita are both licensed under Broker Gail. The seller signs a designated agency consent form, but Helen signs only a standard buyer representation agreement and does not sign a designated agency consent form. Which of the following best describes the legal status of this transaction?
Correct Answer
C) The designated agency is not properly established because Helen has not provided written consent to the arrangement
For designated agency to be validly established in South Dakota, written informed consent must be obtained from ALL parties — both the buyer and the seller. The seller's signed consent form alone is insufficient. Because Helen has not signed a designated agency consent form acknowledging and agreeing to the designated agency arrangement, the designated agency has not been properly established. Broker Gail may be in violation of SDCL 36-21A by proceeding without full written consent from all parties. Helen's buyer representation agreement does not substitute for designated agency consent.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
An agency relationship created by a clear, explicit agreement between the principal and agent, either orally or in writing.
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