Current through Bulletin 2024-06, March 15, 2024
An individual licensee shall:
(1) uphold the following fiduciary duties in
the course of representing a principal:
(a)
loyalty, which obligates the agent to place the best interests of the principal
above any other interest, including the agent's own;
(b) obedience, which obligates the agent to
obey any lawful instructions from the principal;
(c) full disclosure, which obligates the
agent to inform the principal of any material fact the agent learns about:
(i) the other party; or
(ii) the transaction;
(d) confidentiality, which prohibits the
agent from disclosing, without permission, any information given to the agent
by the principal that would likely weaken the principal's bargaining position
if it were known, but excepting any known material fact concerning:
(i) a defect in the property; or
(ii) the client's ability to perform on the
contract;
(e) reasonable
care and diligence;
(f) holding
safe and accounting for any money or property entrusted to the agent;
and
(g) any additional duties
created by the agency agreement;
(2) define the scope of the individual's
agency by executing execute a written agency agreement between the individual
and the individual's principal, including:
(a)
sellers the individual represents;
(b) buyers the individual
represents;
(c) buyers and sellers
the individual represents as a limited agent in the same transaction pursuant
to Subsection (4);
(d) the owner of
a property for which the individual will provide property management services;
and
(e) a tenant whom the
individual represents;
(3) if representing both principals in a
transaction as a limited agent, obtain prior informed consent by:
(a) clearly explaining in writing to both
parties:
(i) that each may be represented by a
separate agent;
(ii) the type of
information that will be held confidential;
(iii) the type of information that will be
disclosed; and
(iv) the
circumstances under which the withholding of information would constitute a
material misrepresentation regarding the property or regarding the abilities of
the parties to fulfill their obligations;
(b) obtaining a written acknowledgment from
each party affirming that the party waives the right to:
(i) undivided loyalty;
(ii) absolute confidentiality; and
(iii) full disclosure from the licensee;
and
(c) obtaining a
written acknowledgment from each party affirming that the party understands
that the licensee will act in a neutral capacity to advance the interests of
each party;
(4) when
acting under a limited agency agreement:
(a)
act as a neutral third party; and
(b) uphold the following fiduciary duties to
both parties:
(i) obedience, which obligates
the limited agent to obey any lawful instructions from the parties, consistent
with the agent's duty of neutrality;
(ii) reasonable care and diligence;
(iii) holding safe any money or property
entrusted to the limited agent; and
(iv) any additional duties created by the
agency agreement;
(5) when making an offer or solicitation to
buy, sell, lease or rent real property as a principal, either directly or
indirectly, or as an agent for a client, a licensee shall disclose in the
initial contact with the other party the fact that the licensee holds a license
with the division, whether the license status is active or inactive;
(6) before the execution of a binding
purchase or lease agreement, disclose in writing to clients, agents for other
parties, and unrepresented parties:
(a) the
licensee's position as a principal in any transaction where the licensee
operates either directly or indirectly to buy, sell, lease, or rent real
property;
(b) the fact that the
licensee holds a license with the division, whether the license status is
active or inactive, in any circumstance where the licensee is a principal in an
agreement to buy, sell, lease, or rent real property;
(c) the licensee's agency relationships;
and
(d)
(i) the existence or possible existence of a
due-on-sale clause in an underlying encumbrance on real property; and
(ii) the potential consequences of selling or
purchasing a property without obtaining the authorization of the holder of an
underlying encumbrance;
(7) before offering any property for sale or
lease, make reasonable efforts to verify the accuracy and content of the
information and data to be used in the marketing of the property;
(8) before offering a residential property
for sale, disclose the source on which the licensee relies for any square
footage data that will be used in the marketing of the property:
(a) in the written agreement, executed with
the seller, through which the licensee acquires the right to offer the property
for sale; and
(b) in a written
disclosure provided to the buyer, at the licensee's direction, at or before the
deadline for the seller's disclosure per the contract for sale;
(9) upon initial contact with
another agent in a transaction, disclose the agency relationship between the
licensee and the client;
(10) when
executing a binding agreement in a sales transaction, confirm the prior agency
disclosure:
(a) in the currently approved Real
Estate Purchase Contract; or
(b) in
a separate provision with substantially similar language incorporated in or
attached to the binding agreement;
(11) when executing a lease or rental
agreement, confirm the prior agency disclosure by:
(a) incorporating it into the agreement;
or
(b) attaching it as a separate
document;
(12) if the
licensee desires to act as a sub-agent for showing property owned by a seller
who is under contract with another brokerage, before showing the seller's
property:
(a) notify the listing brokerage
that sub-agency is requested; and
(b) enter into a written agreement with the
listing brokerage with which the seller has contracted:
(i) consenting to the sub-agency; and
(ii) defining the scope of the
agency;
(c) obtain from
the listing brokerage any available information about the property;
and
(d) uphold the same fiduciary
duties outlined in Subsection (1);
(13) provide copies of a lease or purchase
agreement, properly signed by each party, to the party for whom the licensee
acts as an agent;
(14)
(a) in identifying the seller's brokerage in
paragraph 5 of the approved Real Estate Purchase Contract, use:
(i) the principal broker's individual name;
or
(ii) the principal broker's
brokerage name; and
(b)
personally fulfill the licensee's agency relationship with the client,
notwithstanding the information used to complete paragraph 5;
(15) timely inform the licensee's
principal broker or branch broker of real estate transactions in which:
(a) the licensee is involved as agent or
principal;
(b) the licensee has
received funds on behalf of the principal broker; or
(c) an offer has been written;
(16)
(a) disclose in writing to each party to a
transaction any compensation in addition to any real estate commission that
will be received in connection with a real estate transaction; and
(b) ensure that any such compensation is paid
to the licensee's principal broker;
(17)
(a) in
negotiating and closing a transaction, a licensee may fill out those legal
forms as provided for in Section
61-2f-306;
(18) use an approved addendum form
to make a counteroffer or any other modification to a contract;
(19) before signing or initialing a document
on behalf of a principal in a sales transaction:
(a) obtain prior written authorization in the
form of a power of attorney executed by the principal;
(b) retain in the file for the transaction a
copy of said power of attorney;
(c)
attach said power of attorney to any document signed or initialed by the
individual on behalf of the principal;
(d) sign as follows: "(Principal's Name) by
(Licensee's Name), Attorney-in-Fact;" and
(e) initial as follows: "(Principal's
Initials) by (Licensee's Name), Attorney-in-Fact for (Principal's
Name);"
(20) before
signing or initialing a document on behalf of a principal in a property
management transaction:
(a) obtain prior
written authorization executed by the principal which specifically identifies
the actions that are authorized to be taken on behalf of the
principal;
(b) retain in the file
for the transaction a copy of the written authorization;
(c) sign as follows: "by (Licensee's Name),
on behalf of Owner;" and
(d)
initial as follows: "by (Licensee's initials), on behalf of Owner;"
(21) if employing an unlicensed
individual to provide assistance in connection with real estate transactions,
adhere to Section
R162-2f-401g;
(22) strictly adhere to advertising
restrictions as outlined in Section
R162-2f-401h;
(23) as to a guaranteed sales agreement,
provide full disclosure regarding the guarantee by executing a written contract
that contains:
(a) the conditions and other
terms under which the property is guaranteed to be sold or purchased;
(b) the charges or other costs for the
service or plan;
(c) the price for
which the property will be sold or purchased; and
(d) the approximate net proceeds the seller
may reasonably expect to receive;
(24) immediately deliver money received in a
real estate transaction to the principal broker for deposit; and
(25) as contemplated by Subsection
61-2f-401(18),
when notified by the division that information or documents are required for
investigation purposes, respond with the required information or documents in
full and within ten business days. The division may not bring an action for
enforcement of this subsection after the expiration of four years following the
occurrence of the violation.
