Walking the Line

It is one of the more challenging aspects of the business to be in the position of representing both sides in a transaction, and yet when it works well it is also one of the most rewarding. Most real estate contracts begin with the Agency Disclosure form, which outlines the three basic types of agency relationships that exist between the agent and the client, namely as a Seller’s Agent, a Buyer’s Agent, and as an Agent Representing the Buyer and Seller. During their professional interactions, an agent owes all parties to the transaction a duty of (1) diligent exercise of reasonable skill and care in performance of the agent’s duties, (2) honest and fair dealing and good faith, and (3) to disclose all facts known to the agent materially affecting the value or desirability of the property. Beyond that, to their own clients they owe ‘a fiduciary duty of utmost care, integrity, honesty and loyalty in their dealings.’ The form also goes on to state that the agent is not obligated to reveal to either party any confidential information obtained from the other party that does not involve these affirmative duties. It gets a little more complicated when the agent represents both sides, because their fiduciary duties of utmost care, integrity, honesty and loyalty are equally divided in their dealings with each party. To accomplish this requires a fair amount of juggling and an innate ability to hear things through the ears of each client as you formulate your responses to their requests and opinions, keeping in mind the obligation to not reveal anything that needs to be held in confidence.

In one extreme example, I represented three different buyers and the seller in a multiple offer situation taking care to maintain each party’s trust throughout the negotiation process all the way through close of escrow, and it was a balancing feat to say the least. This experience was emotionally exhausting but well worth it to have both a positive result for the prevailing party while continuing to work with the other two buyers as clients. One of the main keys to successfully walking the line is to make it clear to everyone involved that if for any reason they feel their interests are not being served to the highest level that they are free to select another agent at any time.

Generally speaking, in a dual agency scenario the role of the agent becomes more as an intermediary than an advocate, and if either side shows signs of losing faith in the agent’s commitment to fully represent their interests, on occasion it can make sense to arrange for the parties to meet face to face, with the agent moderating the discussion. This helps leave no stone unturned and assure both sides that they were able to have their interests fully advocated for. And when you are able to successfully walk that line, it ends up being a win for everyone involved, regardless of the outcome of the transaction.