Same-Brokerage Buyer and Seller: Designated Representation or Multiple Representation
A salesperson at a 40-agent brokerage signs a buyer representation agreement with Priya and Dev, a couple approved to $850,000. The next morning the salesperson’s colleague at the same brokerage lists a semi-detached house in Etobicoke at $829,000 that matches the buyers’ criteria. The buyers want to see it immediately and are prepared to offer $845,000 with a financing condition. The listing salesperson tells the buyer’s salesperson, “The seller will take $820,000 if it’s clean and firm; they’ve already bought another home.” The brokerage’s written policy permits designated representation but requires broker-of-record approval before any same-brokerage transaction. The buyers ask whether they can keep their maximum price confidential and whether the listing salesperson can represent them too. The seller wants all offers presented at 6 p.m.
1. What must the brokerage do before the buyers submit an offer, and can the listing salesperson also represent the buyers?
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Treat this as a same-brokerage conflict, not a routine showing. Under TRESA, the brokerage may act for both clients only through one of two routes: (1) designated representation, if the brokerage has adopted that practice and the broker of record approves; or (2) multiple representation with the informed written consent of both the seller and the buyers. The listing salesperson is already the seller’s representative, so they cannot also be designated for the buyers. A different salesperson would need to be designated for the buyers, with confidentiality controls so the seller’s bottom line and the buyers’ maximum are not shared. If the brokerage does not use designated representation, the brokerage itself would be in multiple representation, requiring written consent from both clients after full disclosure of the conflict and the limits on advocacy. Before any offer, document the consent, confirm who represents whom, and remind the listing salesperson that the $820,000 statement is the seller’s confidential information and should not have been passed on. The buyers’ representative should not repeat it as fact or build an offer around it.
2. How should the buyer’s salesperson handle the buyers’ $845,000 ceiling and the financing condition in the offer?
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The buyers’ $845,000 ceiling is confidential client information and must not be disclosed to the listing salesperson or seller. The buyers’ representative can prepare an offer at $845,000 if that is the clients’ written instruction, but should first show them the CMA, the competing-offer risk, and the effect of a financing condition. A financing condition is not a weakness to be automatically deleted; it protects the buyers if lender approval, appraisal, or conditions fail. In a competitive situation, the representative can strengthen the offer lawfully-for example, a larger deposit, a shorter condition period with a lender commitment in hand, or a flexible closing-but cannot promise the buyers will go higher or reveal their ceiling. The representative should also avoid relying on the listing salesperson’s improper disclosure about $820,000; it is unverified and may be a breach of the seller’s confidence. Advice should be based on market evidence and the buyers’ risk tolerance.
3. What are the listing brokerage’s obligations when the 6 p.m. offers are presented, including deposit and confidentiality?
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At 6 p.m. the listing brokerage must present all offers promptly and let the seller decide whether to accept, reject, or counter. Because one buyer is a client of the same brokerage, the brokerage must maintain the same-brokerage consent or designated-representation safeguards; the listing representative cannot share the buyers’ offer terms with the seller’s side beyond what is authorized, and the buyer’s representative cannot share the seller’s confidential information with the buyers. The listing representative should keep a written record of every offer received and presented. On acceptance, the deposit is payable to the listing brokerage and must be deposited into the brokerage’s trust account promptly under its trust procedures; it cannot be released to the seller until closing, a written mutual release, or a court order. Any counter-offer should be in writing and communicated through the representatives, with deadlines and irrevocability clearly stated.