Can the dual agency authorization in the listing agreement be changed after it is signed?

QUESTION: During a recent listing appointment, I explained to a seller that I prefer not to practice designated dual agency, because I want to make sure that I can bring my buyer clients to the home and show it. The seller thought that sounded reasonable, and in the Exclusive Listing Agreement (Form 101), the seller agreed that I could represent both a buyer and the seller in a transaction. Another agent in my firm has now approached me with a buyer who wants to make an offer on my listing, but this buyer has only agreed to designated dual agency. Do I need to change dual agency with my seller? Can I even do that?

ANSWER: You will need to make sure the dual agency selected by the buyer and seller match, and there are two ways to resolve this situation. First, if you have not received any confidential information about the buyer, then you can ask your seller whether they are willing to amend your agency agreement to direct designated dual agency. Second, the buyer can amend their agency agreement to permit the firm to be dual agent with two different agents.

Both Form 101 and the Exclusive Buyer Agency Agreement (Form 201) explain that “dual agency occurs when a real estate firm represents both the seller and the buyer in a transaction.” There are several options to practice dual agency:

1.     Dual agency where the same agent represents both the buyer and the seller;

2.     Dual agency where two different agents in the same firm represent the parties, one agent for the buyer and one agent for the seller; and

3.     Designated dual agency where two agents from the same firm represent the parties but there is a firewall to prevent the sharing of information between them.

These three options all appear in Forms 101 and 201 and can be initialed as the firm and client see fit if dual agency is permitted.

Options (1) and (2) operate similarly in that the agent or agents in the firm simply facilitate information between the parties. This can be accomplished with either one agent or two agents, and some clients may have a strong opinion as to which option they prefer.

Forms 101 and 201 both make clear that within options (1) and (2), the firm’s dual agent(s) will not disclose that a client may agree to a different price or other contract terms; a client’s motivation for wanting to buy or sell; and any other information that a client deems confidential. However, this means the firm’s dual agent(s) will be limited and not able to give a client specific guidance, such as how much money to offer or accept as a purchase price, how long the due diligence period can or should be, and other important matters.

Option (3), designated dual agency, is quite different. Rather than just facilitating information, a designated dual agent can be an advocate and provide the type of specific advice prohibited in options (1) and (2). This is why neither agent practicing designated dual agency can obtain confidential information about the other side. Remember, the firm still represents both the buyer and the seller, and therefore it has a fiduciary duty to both. If one side has confidential information about the other, and uses that information to harm a firm’s client in dual agency, then the firm’s fiduciary duty may be breached. This is also why Rule .0104(j) of the License Law prohibits a broker-in-charge from practicing designated dual agency with a provisional broker, because the firewall preserving confidentiality cannot be achieved due to the BIC’s supervisory duties.

Because of the differences in all three options of dual agency, it is important that both the buyer and the seller agree to the same one. To change the status of dual agency, an agent can use the Agency Agreement Renewal and/or Amendment (Form 710) or some other writing, such as an email or text message. Just make sure that the writing is kept in the firm’s records to show the client’s consent to the change. A firm may also adopt certain policies to facilitate dual agency and make it easier to navigate within the firm.

For more information on this topic and examples, see Chapter 9 of the North Carolina Real Estate Manual.

Release Date: 05/15/2025

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