Duties of Listing Agent to Estranged Spouse of Client

QUESTION: I just received an offer on one of my listings and I have some questions. The listing is a home site that is owned by an LLC. The LLC is owned by an individual who is a building contractor. My listing agreement names the LLC as the “Seller.”

The builder is separated from his wife. The builder tells me they have a separation agreement that says she will get part of the proceeds of any sale of the property.

I am a little confused about whether I have any duties to the builder’s wife in this situation. I don’t think I do but I want to make sure. For example, I suspect that the builder may not tell her about the offer. Do I need to let her know about it? What if she calls me and starts asking me questions? Also, will she have to sign any contract and deed for the property since she apparently has a right to some of the sale proceeds?

ANSWER: Your client is the LLC. The builder is the LLC’s representative and he is the only person with whom you must or should communicate in carrying out your duties as listing agent. Of course, the wife has a reasonable interest in knowing what’s going on with respect to the sale of the property. We do think you should discuss with the builder whether and to what extent, if any, he authorizes you to communicate with his wife about the sale of the property. If he authorizes you not to disclose any information to his wife, you must honor those instructions. It is up to the builder to make sure that the terms of the separation agreement are complied with, not you.

If the builder owned the property in his own name, his wife would have to sign any contract and deed for the property unless the separation agreement gave him the right to sell the property without her involvement. Here, though, the property is owned by the LLC, not him, so the wife’s signature would not be required on the contract or deed.

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