10/2/2008
1
• Objectives
▫ Discuss Various levels of Agency
▫ Discuss the Code of Ethics regarding Agency
▫ Explain how Agency is formed
▫ Discuss Virginia Agency Law
▫ Explain Disclosure Laws
▫ Explain Duties to Clients and Customers
History of Agency
¾1983 Federal Trade Commission Survey
¾71% of Buyers thought Sub-Agent represented them
¾1985 NAR Appoints Committee on Agency
¾1996 NAR adopts Code of Ethics changes
¾1997 Virginia adapts statutory agency law, to include
Buyer Agency
¾2007 Virginia Real Estate Board adopts Standard
Agent / Limited Services Legislation
• Common Law (Where we were)
▫ Law based on precedent
• Statutory Law (Where we are)
▫ Laws predefined or made “statutes” in the
Commonwealth
10/2/2008
2
¾Principal / Client
¾Customer
¾Designated Agent
¾Agent (Standard Agent)
¾Dual Agent
¾Sub-Agent
¾Transaction “Agent”
¾Limited Services Representative
Limited Services
Everyone Must Do’s
• Perform to agreement
• Promote best interests
If Waived, Results in Limited
Representation
• Assist in Marketing
• Maintain confidentiality
• Exercise ordinary care
• Account for all monies
• Disclose material facts
• Comply with all laws
• Provide all Disclosure Docs
Activities
• Assist in Drafting /
Negotiating
• Establish Strategies for
Accomplishing Objectives
• Reasonable Assistance to
Satisfy Contract Obligations
Required Disclosure Language
• “By entering into this brokerage agreement, the
undersigned do hereby acknowledge their
informed consent
to
the
limited
service
representation by the licensee and do further
acknowledge that neither the other party to the
transaction nor any real
estate
licensee
representing the other party is under any legal
obligation to assist the undersigned with the
performance of any duties and responsibilities
of the undersigned not performed by the limited
service representative.”
Provision of Service by Standard Agent
• Licensee engaged by one party to transaction
dealing with party represented by limited service
t ti
id i f
ti
represen a ve may prov e n or