Agency, Fiduciary Duties, and Property Management
Creation and Types of Agency
Agency is consensual and fiduciary. It arises by express agreement, implication, ratification, or estoppel. Arkansas licensees act as seller's agent, buyer's agent, dual agent (only with the informed written consent of all parties), subagent, or transaction broker who assists the parties without representing either. Disclosure of the relationship must come early - before a party signs an offer - and the agreement should state its term, scope, and compensation. Compensation never determines agency; representation does.
Fiduciary Duties
Be able to recite the six duties cold: care, obedience, loyalty, disclosure, accounting, confidentiality (COLDAC), plus honesty and fair dealing owed to customers. Loyalty bars self-dealing and buying the listing without disclosure. Accounting means no commingling: trust and escrow money goes into a separate account and deposits are handled exactly as the contract directs. Confidentiality survives the termination of the agency.
Property Management
A property manager is the owner's agent, so fiduciary duty runs to the owner, while Fair Housing, habitability, and Arkansas landlord-tenant law protect tenants. Know the management agreement - fees, authority to lease, maintenance spending limits - and that security deposits are trust funds.
Traps and Rule of Thumb
Trap: treating a customer as a client. Trap: assuming dual agency is prohibited - Arkansas permits it with written consent. Trap: revealing the seller's motivation after closing.
Rule of thumb: if you cannot list all six duties, the loyalty and accounting questions are where you will lose points.