Dual agency

In a residential transaction, the written disclosure of what dual agency means goes to both parties before it begins, and their written consent follows, no later than the moment an offer is presented.

Such disclosure shall be in writing and given to both parties prior to the commencement of such dual agency or dual representation.

Va. Code 54.1-2139

Virginia names the position two ways, by the kind of relationship. A dual agent holds agency relationships with both clients under brokerage agreements; a dual representative holds independent contractor relationships with both. Either way, one licensee has a brokerage relationship with seller and buyer in the same real estate transaction, and in a residential sale that licensee may act in that role only with the written consent of all parties, given after the written disclosure of its consequences.

A dual relationship can grow out of a single one, as when a licensee who already represents a seller is asked to represent a buyer for the same property. The Code has a general rule for any such shift: if a licensee's relationship to a client or customer changes, the licensee discloses that in writing to all clients and customers already involved in the specific contemplated transaction.

Commercial real estate follows a shorter rule. A licensee may act as a dual agent or dual representative in a commercial transaction only with the written consent of all clients. Whether a vacant tract falls on the residential or the commercial side of Virginia's brokerage definitions is a question for the supervising broker or an attorney.

The disclosure form the Code prints for a residential sale, in the case where the firm has one existing client and takes on a new one, tells both parties, among other things, what changes once dual agency or representation has begun.

• The licensee cannot advise either party as to the terms to offer or accept in any offer or counteroffer, although the licensee may have advised one party on those terms before dual agency began.
• The licensee cannot advise the buyer client as to the suitability of the property or its condition, other than to make the disclosures the law requires of any licensee representing a seller.
• The licensee cannot advise either party as to what repairs of the property to make or request.
• The licensee cannot advise either party in any dispute that arises relating to the transaction.
• Either party may engage another licensee, at additional cost, to represent their own interests.

The first item carries a qualifier worth reading twice. The limit on advising about terms runs from the start of dual agency forward, and the disclosure itself tells both parties that the licensee may have advised one of them on terms before that point.

Confidences stay where they were given. The statutory dual agency disclosure forms state that a dual agent or dual representative may not disclose to either client information the other client gave within the confidence and trust of the brokerage relationship, except information that Article 3 of Chapter 21 otherwise requires or permits to be disclosed.

A firm can also split the two sides between two of its licensees, which is designated agency, though the broker supervising that transaction is still treated as dual. A buyer who has no licensee of their own is in a different position again, set out in who represents you if you buy land without a buyer's agent.