1.3 New York Agency Disclosure
Key Takeaways
- RPL Section 443 requires the New York State Disclosure Form to be presented at first substantive contact with a buyer or seller
- New York recognizes seller's agent, buyer's agent, broker's agent, dual agent, and dual agent with designated sales agents
- Dual agency requires informed, written consent from both parties before the dual representation begins
- If the consumer refuses to sign, the licensee notes the refusal in writing and keeps the form for 3 years
- As of 2024–2025, NAR's settlement pushed written buyer-broker agreements into NY practice, now reflected in the 2026 curriculum
The Statutory Disclosure Rule (RPL 443)
New York Real Property Law Section 443 requires a licensee to provide the New York State Disclosure Form for Buyer and Seller at first substantive contact and to obtain a signature acknowledging receipt (not consent to representation). The agent keeps the signed form for three years.
What counts as "substantive contact"?
| IS substantive (disclose now) | NOT substantive (no form yet) |
|---|---|
| Discussing a specific property's terms | Giving directions to an open house |
| Discussing the consumer's motivation/finances | Stating asking price already public |
| Negotiating or showing by appointment | A brief phone inquiry about hours |
Trap: The form acknowledges receipt of disclosure — it is not consent to be represented and not a brokerage contract. If a buyer signs the disclosure form, that alone does not make them your client.
Worked scenario: A consumer at an open house starts describing their budget and asks you to negotiate. Casual greeting = not substantive; the moment finances/strategy enter, substantive contact has begun and the form is due before you continue.
New York Agency Relationships
| Relationship | Owes fiduciary duties to | Key point |
|---|---|---|
| Seller's agent | Seller only | Listing broker's role |
| Buyer's agent | Buyer only | Now usually paired with a written buyer-rep agreement |
| Broker's agent | The client, through the engaging broker | Cooperating agent who is not a subagent of the listing broker |
| Dual agent | Both parties (limited) | Needs informed written consent |
| Dual agent with designated sales agents | Each party, via a separate designated agent | NY's preferred solution to dual agency |
Dual Agency
Dual agency arises when one agent — or one brokerage — represents both buyer and seller. It is legal in New York only with prior, informed, written consent from both parties. A dual agent cannot advocate for either side, cannot reveal one party's confidential price/strategy to the other, and must remain impartial.
Designated Sales Agents (a heavily tested NY feature)
When a buyer and seller in the same brokerage both want advocacy, the broker — with written consent — may appoint designated sales agents: one salesperson exclusively represents the buyer and a different salesperson exclusively represents the seller. The supervising broker is the dual agent, but each consumer still gets a dedicated advocate.
Consequences of Non-Disclosure
| Consequence | Detail |
|---|---|
| Discipline | DOS reprimand, fine, suspension, or revocation |
| Commission risk | Court may deny recovery of the commission |
| Civil liability | Damages to the harmed consumer |
2026 update: Following the NAR settlement, written buyer-broker representation agreements are now standard NY practice, and the 2026 salesperson exam adds scenario questions on when those agreements and compensation terms must be disclosed.
The Fiduciary Duties Behind the Disclosure
Why does New York insist on disclosure? Because once an agency relationship forms, the licensee owes the client a set of fiduciary duties often memorized as OLD CAR:
| Duty | Meaning in NY practice |
|---|---|
| Obedience | Follow the client's lawful instructions |
| Loyalty | Put the client's interest above the agent's own |
| Disclosure | Tell the client all known material facts |
| Confidentiality | Protect the client's private/negotiation info (survives the transaction) |
| Accounting | Account for all money and documents |
| Reasonable care | Act with competence and diligence |
The disclosure form exists so the consumer understands which of these duties they are — or are not — owed before they reveal sensitive information.
Buyer's Agent vs. Broker's Agent (a precise NY distinction)
- A buyer's agent is engaged directly by the buyer and owes the buyer full fiduciary duties.
- A broker's agent is engaged by another broker to act on behalf of that broker's client. The broker's agent does not create its own client relationship — it is not a subagent of the listing broker. This narrow definition is uniquely New York and is heavily tested.
Worked scenario: Listing broker A asks broker B to help market A's listing. B becomes A's broker's agent and owes duties to A's seller-client through A — B does not become the seller's direct agent and does not become A's subagent.
Refusal to Sign and Recordkeeping
If the consumer refuses to sign the New York State Disclosure Form, the licensee does not abandon the deal — instead the licensee sets forth in writing the date, time, and that the consumer declined, then retains the form for three years. The disclosure obligation is satisfied by presenting the form; a signature only acknowledges receipt.
Common trap: "Comfort letters," oral disclosures, or emailing a brochure do not satisfy RPL 443. The statutory form itself must be presented at first substantive contact.
When the Disclosure Form Is NOT Required
RPL 443 carves out situations where the form is not mandated. You do not present the residential disclosure form for:
- Commercial property transactions
- Buildings with more than four residential units (multi-family beyond a small home)
- Vacant land transactions in many cases
The form is geared to one-to-four-family residential sales and leases, which is where uninformed consumers most need protection. An exam scenario about leasing office space should not trigger the residential agency disclosure form — recognizing the exemption is itself a test point.
When must the New York State Disclosure Form be presented under RPL 443?
A single brokerage represents both the buyer and seller, and each consumer wants a dedicated advocate. With written consent, what does New York allow?