Dual Agency Disclosure Information
Dual agency creates an inherent conflict of interest: the agent cannot fully represent the buyer's best interest while simultaneously representing the seller's best interest. For example: the buyer wants to pay the lowest price, while the seller wants the highest price; the buyer wants maximum repairs, while the seller wants minimum repairs; and the buyer's financial information is confidential, but the seller would benefit from knowing the buyer's maximum price. Because of these conflicts, many states either prohibit dual agency or require specific disclosure and consent. Florida's approach is to eliminate dual agency entirely: instead of dual agency, Florida requires the agent to operate as a transaction broker, which removes the fiduciary duties of loyalty and confidentiality (which create the conflict).
Florida Legal Definition
Florida's approach to dual agency is established by Florida Statutes §475.278. Under §475.278(2), a transaction broker provides limited services to one or more parties without creating a fiduciary relationship. Under §475.278(3), a single agent owes full fiduciary duties to their client. Under §475.278(1)(b), a licensee may not operate as a dual agent (representing both parties as a single agent). Instead, if the same licensee is working with both the buyer and seller, they must: transition to transaction broker status (losing the fiduciary duties of loyalty and confidentiality), and provide the transaction broker disclosure to both parties. The transaction broker disclosure must be in writing and must be provided at or before the time the agent begins working with the party.
How It's Used in Practice
In practice, attorneys advise clients on brokerage relationships and the implications of transaction broker status. The attorney advises: the buyer or seller should obtain a single agent (who owes full fiduciary duties) whenever possible, if the agent is a transaction broker, the client should understand that the agent does not owe loyalty or confidentiality (the agent cannot advocate for your interests over the other party's), the client should verify which disclosure form was signed (single agent vs. transaction broker), and the client should consider retaining their own attorney for independent advice (since the transaction broker cannot provide the same level of advocacy as a single agent). Common issues include: agents who fail to transition to transaction broker status when working with both parties, agents who continue to advocate for one party while operating as a transaction broker, and clients who do not understand the limitations of transaction broker representation.
Key Takeaways
- Florida prohibits dual agency; uses transaction broker instead.
- Transaction broker: limited duties; no loyalty or confidentiality.
- Single agent: full fiduciary duties to one client.
- Written disclosure required at or before beginning representation.
- Retain your own attorney for independent advice with a transaction broker.
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Reviewed by the attorneys at Barnes Walker, Goethe, Shea & Robinson, PLLC