2.1 Maine Agency Relationships

Maine's Statutory Agency Framework

Maine's brokerage relationships are spelled out in Title 32, Chapter 114, Subchapter 7 of the Maine Revised Statutes (sections 13271 through 13280), administered by the Maine Real Estate Commission (MREC). Exam questions in this domain test the exact Maine vocabulary, so memorize the statutory terms - generic national-exam phrasing will be the wrong answer.

The first distinction is client versus customer. A client is a person who has signed a written brokerage agreement in which the agency agrees to represent them (section 13271). A customer is a buyer or seller who has NOT signed an agreement; the licensee owes them only the basic statutory duties, not full representation. A consumer is a customer by default until a written brokerage agreement converts them into a client.

The Transaction Broker (section 13283)

Maine does recognize a non-fiduciary relationship called the transaction broker, defined in Title 32, section 13283 (and in the section 13271 definitions). A transaction broker is a brokerage agency that provides brokerage services to one or more parties without a fiduciary relationship as a buyer agent, seller agent, subagent, or disclosed dual agent. A transaction broker does not represent any party as a client and is not bound by the agency duties in section 13272.

Some study materials loosely call this role a 'facilitator,' but the statutory Maine term is transaction broker - expect the exam to use the statutory word.

Because a transaction broker has no client and no fiduciary duties, it owes only the basic statutory duties (honesty, disclosure of known material physical defects, accounting, and legal compliance). The critical distinction the exam tests: a transaction broker has no automatic duty of confidentiality to either party - unlike a buyer or seller agent, it may share information unless the parties and the brokerage specifically agree otherwise in writing.

Do not confuse the transaction broker (a defined non-agency role a brokerage elects) with a mere customer (a consumer the brokerage simply has not signed to a representation agreement).

How Relationships Are Created and Terminated

Agency in Maine is created by a written brokerage agreement, never by a handshake or by the mere act of showing property. A buyer agency agreement and a seller listing agreement are the two most common written contracts. Each must state the type of relationship, the services provided, the compensation and who pays it, the duration, and how to terminate early. An agreement that lacks a fixed end date is disfavored; the exam expects a defined term.

Relationships end at the agreement's expiration, by mutual written release, by completing the transaction, or by operation of law (death, incapacity, or bankruptcy of a party). A licensee changing firms does not carry the client relationship with them - the brokerage agreement is with the agency, acting through its designated broker, not with the individual affiliated licensee.

The Four Client Relationships and the Basic Duties

Maine recognizes four ways a licensee can act for a client, plus a baseline set of duties owed to everyone.

Full Agent Duties (Owed to a Client)

A seller or buyer agent owes the classic fiduciary-style duties. A common memory device is OLD CAR:

• Obedience to lawful instructions
• Loyalty - put the client's interest first
• Disclosure of material facts to the client
• Confidentiality of the client's negotiating position
• Accounting for all money and property
• Reasonable care, skill, and diligence

Basic Duties Owed to Everyone (Customer or Client)

Under sections 13273-13280, every licensee, even toward a customer they do not represent, must: deal honestly and not give false information; disclose all material defects in the physical condition of the property of which the licensee knew or reasonably should have known; account for all money and property received; and comply with all state and federal law. A worked example: a seller agent showing a house to an unrepresented buyer (a customer) owes that buyer honesty and physical-defect disclosure, but owes loyalty and price advice only to the seller-client.

Disclosed Dual Agency and Appointed Agency

Disclosed Dual Agent (section 13275)

A disclosed dual agent is a brokerage agency representing two or more clients whose interests are adverse in the same transaction, with the knowledge and informed written consent of those clients. The dual agent may not promote one client's interest to the detriment of the other and may not disclose confidential information such as the lowest price a seller will accept or the highest price a buyer will pay. Dual agency arises when the same firm has both the listing and the buyer under representation and the parties consent.

Appointed Agency (section 13278)

Appointed agency is Maine's solution to in-house dual representation. The designated broker appoints one affiliated licensee to act solely for the seller-client and a different affiliated licensee to act solely for the buyer-client. Critically, section 13278 states the agency and the designated broker are not considered dual agents merely because of the appointment - so each consumer keeps a true advocate.

Scenario: Agent Reed lists the Smith home. Buyer Jones, working with Agent Patel at the same firm, wants to make an offer. If the firm's designated broker has an appointed-agent policy and both parties consented in advance, Reed represents Smith and Patel represents Jones - this is appointed agency, not dual agency. If instead one agent tried to write Jones's offer on Reed's own listing, that single agent would become a disclosed dual agent.

Consent and Confidentiality Mechanics

For appointed agency, clients must be informed of the firm's appointed-agent policy and give written consent in advance of entering into the brokerage agreement (section 13278). For disclosed dual agency, the consent must be informed - the consumer must understand that they are giving up an advocate's loyalty and price advice in exchange for the convenience of the in-house deal. In both arrangements, confidential information learned from one client (the seller's bottom line, the buyer's maximum) may not be disclosed to the other.

A dual agent who reveals such information, or who steers the deal to favor one side, breaches the statute and exposes the firm to discipline by the Maine Real Estate Commission.

Common exam trap: appointed agency and disclosed dual agency are easy to confuse. Anchor on the agent count: one neutral agent for both clients equals disclosed dual agency; two separate advocating agents in the same firm equals appointed agency. Only the single-agent, both-sides arrangement triggers true dual-agency neutrality.