Broker-in-Charge (BIC) Rachel operates a real estate firm in Knoxville. Affiliate Broker Jason represents the seller, and Affiliate Broker Maria represents the buyer in the same transaction at Rachel's firm. Rachel designates Jason and Maria to each represent their respective clients exclusively. What type of agency arrangement is this, and what disclosure is required?
Correct Answer
D) Designated agency; the parties must be informed that Jason and Maria each represent only their respective client
Under Tenn. Code Ann. § 62-13-401 et seq., Tennessee recognizes 'designated agency' as a distinct alternative to dual agency. When a BIC assigns different affiliate brokers within the same firm to exclusively represent each party, this is designated agency — not dual agency. The parties must be informed through the TREC-approved Agency Disclosure form that each designated agent represents only their respective client, avoiding the conflicts inherent in true dual agency.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
The fiduciary obligation to protect a client's private information and not disclose it to third parties without permission, surviving even after the agency relationship ends.
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.
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