OREF 041: Where Does the Managing Principal Broker Fit?

Q:  I’m preparing an offer for a buyer on a property listed by another agent in my firm, and I have a question about OREF 041 – Disclosed Limited Agency Agreement for Buyers. 

In Sections 2(a) and (b), the form only addresses whether I, as the buyer’s agent, am authorized to act as a Disclosed Limited Agent. It doesn’t mention the Managing Principal Broker. 

If I remember my training correctly, when two agents in the same firm represent different parties, each agent represents their own client, but the Managing Principal Broker becomes a Disclosed Limited Agent. Can you help clarify why the MPB isn’t referenced in those sections? Also, is there a different form that should be used for in-house transactions? 

A:  You’re remembering your training correctly. When two agents supervised by the same Managing (or Authorized) Principal Broker represent different parties in a transaction, each agent represents only their own client, and the Managing Principal Broker becomes a Disclosed Limited Agent. 

This scenario is addressed in Section 2(c) of OREF 041 – Disclosed Limited Agency Agreement for Buyers. You’ll notice there are no checkboxes in this section because it functions as a blanket authorization by the buyer for the Managing Principal Broker to act as a Disclosed Limited Agent in in-house transactions. 

Your question highlights the importance of having clients sign a Disclosed Limited Agency Agreement early in the relationship. Doing so provides clear direction on whether a buyer’s agent is authorized to show properties listed by agents within the same firm, and whether a seller’s agent may allow those agents to show their listing. 

All comments and responses from OREF or its staff, managers, and volunteers are non-legal opinions made for general purposes. Each Forms subscriber must rely solely upon their Principal broker or personal legal counsel for specific advice and instruction. You and your client should independently confirm that the Form(s) you use are legally suitable for the purposes intended and that they are current with respect to all laws and regulations.