Agent’s Legal Duties

There seems to be much confusion among some consumers regarding their view of real estate agent duties. Many complaints that come to the Department of Licensing have to do with the opinion that an agent didn’t fulfill their legal duty because of their assessment of lack of service. The crux of that perception may be that some people mistakenly think that the agent has fallen short of their legal duties, when in fact much of what real estate agents do on behalf of their clients far exceeds the statutory legal minimums.

In 1996 the State of Washington passed a new statute that defined and clarified the agency law for real estate agents. This law spells out clearly the specific duties owed to their buyers and sellers. A reading of the summary of this law (available at any real estate office) allows consumers to clearly understand an agent’s role and legal responsibilities.

A recent court case challenged this law, stating that an agent had fiduciary duties to their client, but that court decision and new legislation reaffirms and further clarifies that duties of real estate agents in Washington State are statutorily and specifically defined. In other words, statutory duties (clearly defined) of agents are very specifically NOT fiduciary.

The concept of fiduciary duty is more vague than statutory duties. Fiduciary duties are part of common law and are subject to a different interpretation by the legal system. The new law eliminated the need for courts to define an agent’s responsibility and liability on a case-by-case basis.

While the duties of a fiduciary are similar to the statutory duties of a real estate agent in terms of a level of loyalty and reasonable care, the statutory duties are not subject to interpretation. Rather, the duties that they owe the general public and their clients are clearly defined by what they have to do to meet that standard and what they are not expected to do unless they agree to additional duties in writing.  

example, agency duties ends when a purchase and sale agreement is signed around, yet most agents offer many services during the escrow process and even after the transaction is closed. A level of service above and beyond the legal duty is what makes some agents stand out as exceptional. Since the competition is intense, this exceptional level of extra service is more the norm than the exception. What is being interpreted by consumers as legally required may really be a market driven expectation.