Agency Relationships, Fiduciary Duties, and Disclosures
Agency questions test Florida's brokerage-relationship law: transaction broker as the default, single agent by written agreement, no dual agency, designated sales associates, and the disclosures owed to buyers and sellers.
Core rules
- Florida presumes a transaction broker relationship unless a single-agent relationship is established in writing. A transaction broker assists both parties but does not represent either as a fiduciary.
- Single agents owe fiduciary duties often summarized as OLD CAR: obedience, loyalty, disclosure, confidentiality, accounting, and reasonable care.
- Transaction brokers owe limited duties: honesty, fairness, disclosure of known facts that materially affect the transaction, accounting, confidentiality, and reasonable care.
- Dual agency is prohibited in Florida. A licensee cannot represent both sides as a single agent; the parties may consent to a transaction-broker relationship or use designated sales associates in authorized nonresidential transactions.
- A 'no brokerage relationship' notice must be in writing before the licensee performs services for a customer without representation.
Worked example
A buyer asks an agent to represent her as a single agent in buying a home the agent also has listed. The agent cannot act as a dual agent. The agent may ask both parties to consent in writing to a transaction-broker relationship, or the buyer may use a different agent. The reasoning: Florida eliminated dual agency, so the choice is single agency on one side or limited representation for both.
Traps
Do not call a transaction broker a fiduciary. Do not assume confidentiality permits hiding known material defects. Do not create a single-agent relationship orally. Do not forget the written no-brokerage-relationship notice when no representation is intended.