Law of Agency Cumulative Practice Test 2025 - Free Law of Agency Practice Questions and Comprehensive Study Guide

For dual agency to be valid, full disclosure and consent from both parties are essential. In a dual agency situation, one agent represents both the buyer and the seller in a real estate transaction. This arrangement can lead to potential conflicts of interest since the agent must balance the interests of both parties. To mitigate this and maintain ethical standards, it is critical that the agent fully discloses their dual role to both the buyer and seller.

Both parties must not only be informed about this dual representation but also give their explicit consent to proceed under these conditions. Without such disclosure and consent, the agent risks violating fiduciary duties and can face legal repercussions. This principle underscores the importance of transparency and agreement in agency relationships to ensure that all parties are aware of the dynamics and agree to proceed despite the potential for conflicting interests.