September 2012 Forms
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Conflict of interest disclosure: manage your ongoing agency conflicts
This article discusses a broker’s use of a Conflict of Interest Disclosure to avoid breaching the fiduciary duty he owes to his client when he has a bias relating to the opposing party in a transaction, or another, whose interests are in conflict with his client’s.
Professional relationships compromised
A conflict of interest arises when a broker or his agent, acting on behalf of a client, has a competing professional or personal bias which hinders his ability to unreservedly fulfill the fiduciary duties he has undertaken to advise and act on behalf of the client.
In a professional relationship, a broker’s financial objective of compensation for services rendered by the broker is not a conflict of interest. However, fees and benefits derived from professional courtesies, familial favors, and preferential treatment by others toward the broker or his agents is compensation which must be disclosed to the client. [See first tuesday Form 119]
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About The Author
Connor P. Wallmark
is a licensed real estate agent and the senior editor in charge of the first tuesday Forms and the Economic Trends in California Real Estate, Agency, Fair Housing, Trust Funds, Ethics and Risk Management, Real Estate Matters and Real Estate Principles books.
