Legal FAQs for REALTORS®
I represented a buyer who had contracted to buy a home from a FSBO seller. The contract did not close because of reasons not related to the property. The buyer decided to continue renting for several years, and we have terminated our broker-client relationship. The owner of the home has now approached me and asked me to list the property. Can I represent the seller under these circumstances? (updated Jan. 27, 2005)
Yes, it is OK for you to represent the seller in this situation. However, you should make it clear to this new client that you cannot reveal to him any confidential information provided to you by your former client unless that client consents to the release of that information to the seller. While there may be little confidential information obtained from the buyer that would be of interest to the seller, it should be noted that information about material defects in the property is not considered confidential information under the Code of Ethics or the Real Estate License Act. Thus, if you had obtained material information about the property while representing your former buyer client, you would be required to disclose that information to the seller and any subsequent buyer of the property during your representation of the seller.
A prospective buyer emailed me to view a property I listed after seeing my listing on my website. Is there a form I should give him to disclose that I represent the seller? (updated June 16, 2014)
No, there isn’t a form available for this purpose. Past agency disclosure forms led to misuse and misunderstandings about the nature of those forms and their intended purpose. Don’t confuse this representation disclosure with the written notice about brokerage services.
Verbal or written disclosure of representation is acceptable, but it should be done upon first contact with another party to the transaction or with another licensee representing a party to the transaction. In this scenario, your call or email response will be the first contact with this prospective buyer.
If a contract is subsequently executed by your seller client and this prospective buyer, a written notation of who you represent will be provided in the Broker Information section of the TREC contracts.
Legal Disclaimer: The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.
While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on TexasRealEstate.com. Any legal or other information found here, on TexasRealEstate.com, or at other sites to which we link, should be verified before it is relied upon.