Broker-in-charge Angela oversees a large Chattanooga real estate firm. When a potential dual agency situation arises, Angela assigns affiliate broker Derek to represent only the seller and affiliate broker Priya to represent only the buyer, with each client receiving written notice of the arrangement. What is the primary advantage of this designated agency structure over traditional dual agency under Tennessee law?
Correct Answer
B) It allows each client to receive undivided loyalty from their own designated agent rather than sharing a conflicted dual agent
The primary advantage of designated agency under Tenn. Code Ann. § 62-13-401 et seq. is that each party receives a dedicated agent who owes that client undivided loyalty. In true dual agency, one agent must balance the competing interests of both parties, which compromises full advocacy. Designated agency avoids this conflict by assigning separate agents.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal requirement for real estate agents to inform all parties about who they represent in a transaction, typically provided at first substantive contact.
A legal relationship in which one person (the agent) is authorized to act on behalf of another person (the principal) in business transactions with third parties.
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
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- → A Vermont licensee is asked about a designated agency firm appoints separate agents for buyer and seller. What is the best answer?
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