Key Takeaways
- Single agency in Colorado requires a written agreement (listing or buyer agency contract)
- Single agents owe full fiduciary duties: loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care
- Seller's agents must disclose adverse material facts to buyers even while representing sellers
- Buyer's agents must present all offers but advocate for buyer's best interests
- Commission-approved contracts create single agency relationships
Single Agency Relationships in Colorado
Single agency occurs when a broker represents only one party in a transaction and owes that party full fiduciary duties.
Creating Single Agency
Seller's Agency
Created by the Exclusive Right-to-Sell Listing Contract:
| Contract Element | Description |
|---|---|
| Parties | Seller and Brokerage |
| Property | Legal description |
| Duration | Start and end dates |
| Commission | Agreed compensation |
| Marketing | Authorized activities |
| Duties | Broker obligations to seller |
Buyer's Agency
Created by the Exclusive Right-to-Buy Contract:
| Contract Element | Description |
|---|---|
| Parties | Buyer and Brokerage |
| Property Type | What buyer is seeking |
| Duration | Start and end dates |
| Compensation | How broker is paid |
| Geographic Area | Where buyer is looking |
| Duties | Broker obligations to buyer |
Fiduciary Duties in Single Agency
Single agents owe clients full fiduciary duties (remember "OLD CAR"):
| Duty | Description |
|---|---|
| Obedience | Follow lawful instructions |
| Loyalty | Put client's interests first |
| Disclosure | Reveal all material facts |
| Confidentiality | Protect private information |
| Accounting | Handle funds properly |
| Reasonable Care | Act competently |
Exam Tip: Even while owing fiduciary duties to their client, agents must still be honest with ALL parties and disclose adverse material facts about property condition.
Seller's Agent Specific Duties
A seller's agent must:
Duties to Seller (Client)
- Market property effectively
- Present all offers promptly
- Advise on pricing and negotiation strategy
- Protect seller's confidential information
- Disclose buyer's negotiation position (if known)
Duties to Buyers (Not Client)
- Deal honestly and not deceive
- Disclose adverse material facts about property
- Account for any deposits received
- Cannot reveal seller's confidential information
What Seller's Agent Cannot Disclose to Buyer
- Seller's lowest acceptable price
- Seller's motivation to sell
- Seller's financial situation
- Any fact that could harm seller's negotiation position
Buyer's Agent Specific Duties
A buyer's agent must:
Duties to Buyer (Client)
- Help locate suitable properties
- Research property information
- Present all offers as instructed
- Advise on negotiation strategy
- Protect buyer's confidential information
Duties to Sellers (Not Client)
- Deal honestly and not deceive
- Present offers promptly
- Account for deposits
- Cannot reveal buyer's confidential information
What Buyer's Agent Cannot Disclose to Seller
- Buyer's highest offering price
- Buyer's motivation to purchase
- Buyer's financial capability beyond what's needed for offer
- Any fact that could harm buyer's negotiation position
In-House Transactions
When the same brokerage represents both parties:
| Option | Description |
|---|---|
| Designated Brokerage | Different brokers assigned to each party |
| Transaction-Brokerage | Become transaction-broker for both |
| Release One Party | Refer one party to different brokerage |
Note: Colorado allows designated brokerage where different brokers within the same company represent each party with full fiduciary duties.
Which Colorado contract creates a seller's agency relationship?
A seller's agent learns the buyer will pay more than the listed price. What should the agent do?