Agency, Fiduciary Duties, and Consumer Disclosure
Creating and defining the relationship
Agency arises when a broker agrees to act on behalf of a principal, and in New Mexico practice it should always be documented in writing before the broker acts. A seller's agent represents the seller; a buyer's agent represents the buyer. Remember that the QBuy - actually memorize the fiduciary bundle as OLDCAR: Obedience (to lawful instructions), Loyalty, Disclosure, Confidentiality, Accounting, and Reasonable care and skill. Add good faith and honesty. These run to the client; a customer is entitled to honesty and fair dealing but not confidentiality or loyalty.
Limited (dual) agency
New Mexico recognizes limited agency, where one brokerage represents both sides with the informed, written consent of both parties. In limited agency the broker may not disclose one party's price motivation or bargaining strategy to the other and must treat both sides even-handedly. Expect questions where a buyer's agent wants to show the brokerage's own listing - the correct answer is to obtain written consent before proceeding, or refer the party out.
Disclosure duties
Beyond fiduciary duties, every licensee owes consumers material-fact disclosure: hidden defects the licensee knows about, adverse physical conditions, and any circumstances that could reasonably affect a decision. Answer questions favoring more disclosure, documented in writing. Confidentiality survives termination of the relationship; the duty to account does not expire.
Traps
(1) Being friendly and helpful does not create agency - representation does, and it should be written. (2) The broker does not decide who gets escrow money. (3) A licensee may not disclose that a seller is divorcing or financially pressured unless the client authorizes it. (4) Do not promise an outcome ("I can get you the house") that you cannot control.
Rule of thumb
Run every agency question through three questions: Who is my client? What did I promise in writing? What must I disclose to the other side no matter what?