Laws of Agency and Fiduciary Duties
Who represents whom
Agency is a relationship in which one person (the agent) acts for another (the principal) with the principal's consent and control. It may be created expressly, impliedly, by ratification, or by estoppel - but in Georgia a brokerage engagement must be in writing. Distinguish the client (represented) from the customer (merely assisted). Compensation does not create agency; who you represent creates agency. A listing broker may offer compensation to a cooperating broker without creating a subagency.
The fiduciary duties
Memorize care, obedience, loyalty, disclosure, accounting, and confidentiality - often abbreviated COLDAC. Loyalty means no secret profit, no self-dealing, and no undisclosed dual representation. Accounting means prompt handling and accounting of funds such as earnest money. Confidentiality protects the client's motivating factors even after termination, but it never excuses withholding known material adverse facts about the property itself.
Dual and designated agency
Georgia allows dual agency and designated agency with informed written consent. The trap is accidental dual agency: an agent who begins advising the other side, or who represents both parties without consent, has created an undisclosed dual agency and breached loyalty. Also watch for a buyer's agent who shows an in-house listing and slips into advocating for the seller.
Termination and traps
Agency ends by performance, expiration, mutual agreement, revocation, renunciation, death, or bankruptcy. Confidentiality and the duty to account can survive. Common exam traps: assuming an agent may accept a commission from a third party without the principal's knowledge; assuming agency arises from being the one who writes the contract; and assuming a facilitator or transaction-broker status exists in Georgia when it does not.
Worked example
A seller tells her agent she must net $400,000 and would accept $380,000. A buyer offers $390,000. The agent may not reveal the seller's bottom line, but must disclose all offers and any known material defects. She presents the offer and advises - she does not decide.