Key Takeaways
- Arkansas requires written disclosure of agency relationships to all parties
- Licensees must provide agency disclosure at first substantive contact with a consumer
- Arkansas recognizes seller agency, buyer agency, disclosed dual agency, and transaction brokerage
- Dual agency requires written consent from both parties before proceeding
- All agency agreements must be in writing to be enforceable
Arkansas Agency Law
Arkansas law requires real estate licensees to disclose their agency relationships to all parties in a transaction.
Agency Disclosure Requirements
When to Disclose
Agency disclosure must be provided:
- At first substantive contact with a consumer
- Before discussing confidential information
- Before showing properties or taking listings
What is "Substantive Contact"?
| Substantive Contact | NOT Substantive Contact |
|---|---|
| Discussing buyer's needs/finances | Casual greeting |
| Discussing property features | Handing out business card |
| Negotiating terms | General advertising |
| Showing property | Open house sign-in |
Types of Agency Relationships
Arkansas recognizes several types of agency relationships:
1. Seller Agency (Listing Agent)
| Aspect | Description |
|---|---|
| Client | Seller |
| Duties | Full fiduciary duties to seller |
| Compensation | From seller (typically) |
| Buyer status | Customer (limited duties) |
2. Buyer Agency
| Aspect | Description |
|---|---|
| Client | Buyer |
| Duties | Full fiduciary duties to buyer |
| Compensation | Varies (buyer, seller, or split) |
| Seller status | Customer (limited duties) |
3. Disclosed Dual Agency
| Aspect | Description |
|---|---|
| Client | Both buyer and seller |
| Requirements | Written consent from BOTH parties |
| Duties | Limited; must be neutral |
| Prohibited | Disclosing confidential information without consent |
4. Transaction Brokerage
Transaction brokerage is an alternative to agency where the licensee facilitates the transaction without representing either party:
| Aspect | Description |
|---|---|
| Client | Neither party |
| Role | Facilitator, not advocate |
| Duties | Honesty, disclosure of material facts |
| Loyalty | None—neutral to both parties |
Key Difference: A transaction broker provides services but does NOT owe fiduciary duties like loyalty and confidentiality to either party.
Fiduciary Duties
When representing a client, Arkansas licensees owe these fiduciary duties:
The OLDCAR Duties
| Duty | Description |
|---|---|
| Obedience | Follow lawful instructions |
| Loyalty | Put client's interests first |
| Disclosure | Reveal all material facts |
| Confidentiality | Protect client's private information |
| Accounting | Account for all funds and documents |
| Reasonable Care | Use skill and competence |
Duties to ALL Parties (Customers)
Even when not representing a party, licensees owe these duties:
| Duty | Description |
|---|---|
| Honesty | No misrepresentation |
| Fair dealing | Treat fairly |
| Material facts | Disclose known defects |
| Present offers | Timely presentation of all offers |
Important: These duties apply to ALL parties, not just clients.
When must an Arkansas licensee provide agency disclosure to a consumer?
What is required for disclosed dual agency in Arkansas?
Which duty does an Arkansas licensee owe to ALL parties, not just clients?