2.1 South Carolina Agency Relationships

The Statutory Framework: S.C. Code 40-57-350

South Carolina abandoned common-law agency presumptions and replaced them with statutory brokerage relationships defined in S.C. Code Section 40-57-350. The single most tested rule: no agency relationship exists between a consumer and a brokerage firm unless both agree to it IN WRITING. Until that written agreement is signed, the consumer is a customer, and the firm is presumed to be acting as a transaction broker.

This is the trap most candidates miss. A buyer who tours ten houses with the same licensee, texts daily, and trusts that licensee completely is still a customer with no representation if nothing was signed. Verbal promises and a friendly relationship do not create agency in South Carolina.

Client vs. Customer: The Core Distinction

Worked scenario: A seller tells the listing agent, "I'll take $290,000 but listed at $315,000." If the seller is a client, that bottom line is confidential and cannot be revealed. If a buyer working as a customer asks the same licensee, "What will they really accept?", the licensee may share what the seller has authorized but must not invent advocacy that does not exist.

The Four Brokerage Relationships

1. Transaction Brokerage (the Default)

A transaction broker provides customer service to a buyer, seller, or both without representing either party. At first substantive contact, South Carolina law presumes the firm is a transaction broker. The transaction broker:

• Does NOT advocate for or owe loyalty to either side
• Owes honesty, accurate disclosure of known material facts, accounting of funds, and timely presentation of all written offers
• Keeps neither party's negotiating position confidential beyond what the law requires

2. Single Agency

A single agent represents exactly one party and owes that party full fiduciary duties, commonly memorized with the acronym OLD CAR: Obedience, Loyalty, Disclosure, Confidentiality, Accounting, and Reasonable care/diligence.

3. Designated Agency

Designated agency is the South Carolina solution to in-house transactions where one firm has both the listing client and the buyer client. The broker-in-charge (BIC) designates one associated licensee to represent the seller and a different associated licensee to represent the buyer. Each designated agent owes full fiduciary duties (the complete OLD CAR set) to their own client and may fully advocate for that client.

Key trap: Designated agency is not dual agency at the agent level. The two designated agents each fully represent their client; only the BIC (and the firm) sit in the neutral dual-agent position above them.

4. Dual Agency

Dual agency occurs when the same licensee, or the same firm without separate designated agents, represents both buyer and seller. Because one person cannot fully advocate for two opposing parties, dual agency drops to limited representation:

Worked scenario: A licensee has a signed buyer-agency agreement with Mr. Lee and the same licensee's own listing is the house Mr. Lee wants. To proceed, the licensee must obtain written dual-agency consent from both the seller and Mr. Lee. Once a dual agent, the licensee cannot tell Mr. Lee the seller is desperate, nor tell the seller that Mr. Lee is pre-approved for far more.

Duties Owed to ALL Parties (Clients AND Customers)

Regardless of relationship, every South Carolina licensee owes a baseline set of duties:

• Present all written offers and counteroffers promptly
• Account for all money and property received (escrow/trust handling)
• Disclose known material adverse facts about the property
• Treat all parties honestly and provide accurate information
• Explain the scope of services and the brokerage relationship

Exam tip: Negotiating the best price, keeping a party's information confidential, and giving advice are CLIENT-only duties. Honesty, accounting, and presenting all offers are owed to EVERYONE.