Holiday Closure

The OREA office will close for the holidays at 12 p.m. Tuesday, December 24th.  Normal business hours will resume on Thursday, January 2nd.  Happy Holidays!

Holiday Closure

The OREA office will close for the holidays at 12 p.m. Tuesday, December 24th.  Normal business hours will resume on Thursday, January 2nd.  Happy Holidays!

October 21st - 2003

MERV‘S COLUMN

Whose agent?

Whose agent?

The buyer and his son contacted REALTOR X who was to help them find some property. Eventually REALTOR X negotiated with a seller and gave him some information about the buyer in a résumé. Included was this phrase, ".. and they are able to complete a business transaction in Canada around $10 to $15 million."

The buyers signed a Buyer Agency Agreement and understood that the seller would pay any commission. The buyers then decided to deal through another REALTOR (Y), and the Agreement with REALTOR X was terminated. REALTOR X then signed a Listing with the seller. Negotiations were carried on between the clients with a signed Limited Dual Agency Agreement. Eventually a deal was agreed to at $12.6 million and REALTOR X and REALTOR Y shared the commission.

The buyers sued REALTOR X and his brokerage for breach of fiduciary, common law and statutory duties in telling the seller about their worth. The Judge heard evidence over 9 days and went through a detailed analysis of that evidence and the law. On the facts she found that there were no breaches of duties by REALTOR X. The buyers knew what position both REALTORS were in and the actual representation situation. In any event, there was no damage that resulted from the disclosure in the résumé as the buyers knew that the seller wanted to know if the buyers had the means to complete such a transaction. The buyers complained that the seller might have sold for less than the agreed price if that information had not been made available. The seller denied that was the situation as the sale price was fair and negotiated between astute parties.

Lee v Royal Pacific Realty 2003 BCSC 0911

MERV’S COMMENTS

It is sometimes difficult to decide what information should be kept confidential in this type of situation. What should a REALTOR do when you represent a buyer but that agreement terminates?  Later on that former client-buyer comes to see one of your Listings with another REALTOR. You are representing the sellers - but you have information about the buyer’s negotiating position and abilities. What do you tell your sellers? Remember that you must follow your clients’ lawful instructions and the provisions in your Agency Representation Agreements. Even after your agency relationship ends your fiduciary duties will continue. This is discussed in OREA’s Agency Practices seminar and also on Legal Forum at www.orea.com.  (For example see Agency, Dual Agency, June 6, 2003.)

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The trademarks REALTOR®, REALTORS®, and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. The trademarks MLS®, Multiple Listing Service® and the associated logos are owned by The Canadian Real Estate Association (CREA) and identify the quality of services provided by real estate professionals who are members of CREA. Used under license.

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