This pamphlet describes agency relationships
and the duties and responsibilities of real estate licensees
in Oregon. This pamphlet is informational only and neither the
pamphlet nor its delivery to you may be construed to be evidence
of intent to create an agency relationship.
Real Estate Agency Relationships
An "agency" relationship is a voluntary
legal relationship in which a real estate licensee (the "agent")
agrees to act on behalf of a buyer or a seller (the "client")
in a real estate transaction. Oregon law provides for three
types of agency relationships between real estate agents and
their clients:
Seller's Agent -- Represents the seller
only;
Buyer's Agent -- Represents the buyer only;
Disclosed Limited Agent -- Represents both
the buyer and seller, or multiple buyers who want to purchase
the same property. This can be done only with the written permission
of both clients.
The actual agency relationships between the
seller, buyer and their agents in a real estate transaction
must be acknowledged at the time an offer to purchase is made.
Please read this pamphlet carefully before entering into an
agency relationship with a real estate agent.
Duties and Responsibilities of an Agent
Who Represents Only the Seller or Only the Buyer
Under a written listing agreement to sell property,
an agent represents only the seller unless the seller agrees
in writing to allow the agent to also represent the buyer. An
agent who agrees to represent a buyer acts only as the buyer's
agent unless the buyer agrees in writing to allow the agent
to also represent the seller. An agent who represents only the
seller or only the buyer owes the following affirmative duties
to their client, other parties and their agents involved in
a real estate transaction:
1. To exercise reasonable care and diligence;
2. To deal honestly and in good faith;
3. To present all written offers, notices and
other communications in a timely manner whether or not the seller's
property is subject to a contract for sale or the buyer is already
a party to a contract to purchase;
4. To disclose material facts known by the agent
and not apparent or readily ascertainable to a party;
5. To account in a timely manner for money and
property received from or on behalf of the client;
6. To be loyal to their client by not taking action
that is adverse or detrimental to the client's interest in a
transaction;
7. To disclose in a timely manner to the client
any conflict of interest, existing or contemplated;
8. To advise the client to seek expert advice
on matters related to the transactions that are beyond the agent's
expertise;
9. To maintain confidential information from or
about the client except under subpoena or court order, even
after termination of the agency relationship; and
10. When representing a seller, to make a continuous,
good faith effort to find a buyer for the property, except that
a seller's agent is not required to seek additional offers to
purchase the property while the property is subject to a contract
for sale. When representing a buyer, to make a continuous, good
faith effort to find property for the buyer, except that a buyer's
agent is not required to seek additional properties for the
buyer while the buyer is subject to a contract for purchase
or to show properties for which there is no written agreement
to pay compensation to the buyer's agent.
None of these affirmative duties of an agent may
be waived, except #10, which can only be waived by written agreement
between client and agent.
Under Oregon law, a seller's agent may show properties
owned by another seller to a prospective buyer and may list
competing properties for sale without breaching any affirmative
duty to the seller. Similarly, a buyer's agent may show properties
in which the buyer is interested to other prospective buyers
without breaching any affirmative duty to the buyer.
Unless agreed to in writing, an agent has no duty
to investigate matters that are outside the scope of the agent's
expertise.
Duties and Responsibilities of an Agent
Who Represents More than One Client in a Transaction
One agent may represent both the seller and the
buyer in the same transaction, or multiple buyers who want to
purchase the same property only under a written "Disclosed
Limited Agency" agreement, signed by the seller, buyer(s)
and their agent.
When different agents associated with the same
real estate firm establish agency relationships with different
parties to the same transaction, only the principal broker (the
broker who supervises the other agents) will act as a Disclosed
Limited Agent for both the buyer and seller. The other agents
continue to represent only the party with whom the agent already
has an established agency relationship unless all parties agree
otherwise in writing. The supervising principal broker and the
agents representing either the seller or the buyer have the
following duties to their clients:
1. To disclose a conflict of interest in writing
to all parties;
2. To take no action that is adverse or detrimental
to either party's interest in the transaction; and
3. To obey the lawful instruction of both parties.
An agent acting under a Disclosed Limited Agency
agreement has the same duties to the client as when representing
only a seller or only a buyer, except that the agent may not,
without written permission, disclose any of the following:
1. That the seller will accept a lower price or
less favorable terms than the listing price or terms;
2. That the buyer will pay a greater price or
more favorable terms than the offering price or terms; or
3. In transactions involving one-to-four residential
units only, information regarding the real property transaction
including, but not limited to, price, terms, financial qualifications
or motivation to buy or sell.
No matter whom they represent, an agent must disclose
information the agent knows or should know that failure to disclose
would constitute fraudulent misrepresentation. Unless agreed
to in writing, an agent acting under a Disclosed Limited Agency
agreement has no duty to investigate matters that are outside
the scope of the agent's expertise.
You are encouraged to discuss the above information
with the agent delivering this pamphlet to you. If you intend
for that agent, or any other Oregon real estate agent, to represent
you as a Seller's Agent, Buyer's Agent, or Disclosed Limited
Agent, you should have a specific discussion with him/her about
the nature and scope of the agency relationship. Whether you
are a buyer or seller, you cannot make a licensee your agent
without their knowledge and consent, and an agent cannot make
you their client without your knowledge and consent.
