Is it possible to be a seller subagent by default?

QUESTION: I represent a buyer who is the husband half of a couple. The wife is not my client and is not planning on purchasing any property. I recently attended a showing with the wife because the husband was out of town. After the showing, the listing agent discovered that the wife was not under an agency agreement with me. They then proceeded to claim that I was practicing seller subagency by representing the wife, and that I was violating the License Law. I told them that I didn’t think that I could be a seller subagent by default, especially when the wife was only there to be another set of eyes for my client. Did I do something wrong?

ANSWER: No. A seller subagent is a broker who assists the buyer in a transaction even though that broker represents the seller. This most often occurs when the buyer wants assistance but will not give permission for the broker to represent them directly as a buyer agent. The Commission has made clear that a broker cannot be a seller subagent by default. This is because seller subagency requires not only the permission of the seller, but also the permission of the buyer. In your case, since the wife was not the buyer and you were not representing her on the seller’s behalf, then you were not a seller subagent.

The seller must authorize subagents in writing, and this can be accomplished in paragraph 8 on Form 101 (“Exclusive Right to Sell Listing Agreement”). If the seller has not authorized seller subagency in Form 101, they can do so in a separate writing. Seller subagents should confirm with the listing agent that the seller has authorized subagency in writing before undertaking any brokerage services on the seller’s behalf. The seller’s authorization may also be listed in the MLS. An agent must disclose seller subagency to the buyer on the Working With Real Estate Agent’s form. If the buyer agrees to seller subagency, they must give authorization in writing. If all these steps are confirmed, a seller subagent can begin providing brokerage services in the transaction to the buyer.

It is important to note that if a broker is acting as a subagent of the seller with written consent, then the broker owes all their fiduciary duty to the seller and is obligated to communicate any confidential, financial, or motivational information provided by the buyer to the seller or the listing agent.

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