A purchase agreement for a residential property in Spearfish, South Dakota includes a clause stating that the buyer and seller consent to dual agency by Broker Kim. The buyer and seller verbally confirmed their agreement to dual agency at the initial meeting, but neither party has signed a written dual agency consent form. Under South Dakota law, is this dual agency arrangement valid?
Correct Answer
C) No, South Dakota law requires written informed consent from all parties for dual agency, and verbal consent alone is insufficient.
Under South Dakota law (SDCL 36-21A-136 and related agency provisions), dual agency is permitted but requires written informed consent from ALL parties to the transaction. Verbal consent, even if given in the presence of all parties, does not satisfy this requirement. The failure to obtain written consent for dual agency is a disciplinary violation and a common exam trap. A dual agency clause buried in the purchase agreement may not constitute proper separate written informed consent as contemplated by South Dakota agency disclosure requirements.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A bilateral contract is an agreement in which both parties exchange promises and are both obligated to perform, while a unilateral contract is one in which only one party makes a promise and the other party is not obligated to act.
A breach of contract occurs when one party fails to perform their obligations under the contract without a legal excuse. The non-breaching party is entitled to legal remedies including damages, specific performance, or contract rescission.
Consideration is something of value exchanged between parties to a contract, making the agreement legally binding. It can be money, a promise to act, a promise to refrain from acting, or anything else of value.
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