3.4 Multiple Representation, Conflicts & Transaction Brokerage
Key Takeaways
Rule 59 applies when clients on both sides share a common law brokerage as agent. Rule 59.1 applies when they share the same designated agent.
The buyer, seller and brokerage sign the property-specific facilitation agreement. The mandatory Guide places written agreement before presentation or acceptance of the initial offer.
If either client declines and the parties cannot agree on representation, apply the first-agency default and the options in Rule 59(3) or 59.1(3).
Give impartial assistance, preserve protected terms and motivations, and make required disclosures about known defects and ability to purchase.
Consider separate representation where impartiality cannot be maintained, including a personal trade by the licensee.
Recognize when the same agent would serve opposing clients
A common law brokerage is the agent of both its seller and its buyer interested in the seller’s property. In designated agency, the corresponding conflict occurs when the same designated agent serves both clients. Explain the conflict at the earliest practical opportunity and disclose the material change immediately where Rule 55 applies. Discuss lawful options without sharing either client’s negotiating limits. Rule 54(3) requires written informed consent before providing services in a conflicted trade. For a buyer and seller, apply the specific transaction brokerage rules as well.
| Available path | What the broker and clients decide |
|---|---|
| Separate representation | In common law agency, the other party can seek another brokerage. In designated agency, another properly separated designated agent or another brokerage may be available. Check what information has already been shared. |
| One party chooses customer status | One party retains sole representation and the other knowingly chooses self-representation. Document the change using the applicable customer acknowledgement. Preserve information obtained in prior agency. |
| Transaction brokerage | The buyer, seller and brokerage enter a written agreement for impartial facilitation of the specified property transaction. |
Transaction brokerage may be unsuitable even if both parties are willing. A licensee buying the property personally cannot act for the other party in that trade. A family or business relationship can also make impartiality unrealistic. Consult the broker about separate representation. A conflict between two competing buyer clients is addressed under the applicable conflict duties, including Rule 54(3), rather than the buyer-and-seller agreement in Rule 59 or 59.1.
Get written agreement before acting as facilitator
Use Rule 59 for common law agency and Rule 59.1 when the same designated agent is involved. Explain the changed duties and alternatives, and give both clients an opportunity to review the agreement and ask questions. The buyer, seller and brokerage sign the agreement. Use the applicable Schedule 1 mandatory content and record the property and remuneration. The mandatory Consumer Relationships Guide places written agreement before either side presents or accepts the initial offer. Resolve the conflict before starting to assist as a facilitator. If an offer already exists or is received unexpectedly, take it to the broker promptly. Review its status and the presentation and delivery duties. Do not assume a later signature cures the conflict.
If either client declines, first check whether the parties agree on who retains representation. Otherwise the first agency relationship has priority under Rules 59(3) and 59.1(3). Offer the other party customer status or referral to another brokerage. Under designated agency, appointment of another designated agent is also an option where appropriate. Apply the agreement to the specific property and check its return-to-representation terms if no deal results.
Facilitate impartially and apply the disclosure rules
The facilitator uses reasonable care and skill, follows consistent lawful instructions and may help both parties negotiate a mutually acceptable agreement. Provide objective property information and comparable data to both, prepare documents to instructions, present offers and counter-offers promptly, and give true copies under Rule 61. Give names of independent specialists without recommending one. Avoid confidential advice, advocacy and discretion favouring either party. The brokerage supervises facilitation and handles money under the Act. Under designated agency, the designated agent takes the facilitator role under the brokerage’s agreement.
Disclose known material latent defects to the buyer and known material facts relevant to the buyer’s ability to purchase to the seller. Subject to these duties and applicable law, obtain informed written consent from the affected party before sharing protected facts such as willingness to change price or terms, motivation or confidential personal information. Keep information from earlier sole representation protected. The facilitator does not conduct or influence the selection of independent inspections or financial inquiries or verify the other party’s statements as part of that role.
For example, a buyer may ask whether to counter at $485,000 instead of accepting $495,000. The facilitator can give both sides the same comparables and explain how to submit a counter-offer. They cannot recommend what to offer or reveal the seller’s private minimum. If another buyer enters the picture, involve the broker and apply the duties for each relationship without using protected information to help a competing party.
RECA Rules · RECA complete Rules, Rule 59.1 · Consumer Relationships Guide · RECA transaction brokerage practice guide
A brokerage appointed Sophia as the designated agent of a seller and of a buyer who now wants the seller’s property. Neither side has presented an offer. Both want facilitation after reviewing the options. What step establishes it?
A later oral agreement after the seller responds to the offer.
The buyer’s signature alone because the buyer will make the first offer.
The buyer, seller and brokerage sign the designated transaction brokerage agreement for the property before presentation or acceptance of the initial offer.
A previously signed Consumer Relationships Guide from each client.
A transaction facilitator receives a seller’s $495,000 counter-offer. The buyer asks if they should counter at $485,000 and whether the seller would accept. What is the appropriate response?
Tell the buyer to offer $485,000 based on the facilitator’s judgment.
Privately tell the buyer whether the seller is willing to come down.
Recommend $490,000 because it splits the difference.
Provide objective comparable information to both sides and explain the counter-offer process without recommending a price.
In designated agency, the brokerage entered into the seller agency relationship before the buyer relationship. The same designated agent serves both clients. The buyer declines transaction brokerage and wants full advocacy. The parties reach no alternative agreement about who stays represented. What should the brokerage do?
Proceed because the brokerage and seller consent.
Continue the earlier seller representation and offer the buyer separate designation or another brokerage for full representation.
End the seller’s agreement because the buyer declined.
Make the buyer a customer and present an offer without the buyer’s agreement.
Sections you finish are checked off in the contents.