Key Takeaways
- Dual agency is permitted in Kentucky with written consent from both buyer and seller
- Dual agents must be impartial and cannot advocate for one party over the other
- Transaction brokers represent neither party but owe limited duties to facilitate the transaction
- Confidential information obtained before dual agency status cannot be disclosed without permission
- In-company transactions may result in dual agency if not properly disclosed and handled
Last updated: January 2026
Dual Agency and Transaction Brokerage
Kentucky allows both dual agency and transaction brokerage as alternatives to single agency representation.
Dual Agency
Dual agency occurs when a licensee or brokerage represents both the buyer and seller in the same transaction.
When Dual Agency Occurs
| Situation | Result |
|---|---|
| Same agent represents both parties | Dual agency |
| Different agents in same brokerage | May be dual agency |
| Buyer client wants to buy own listing | Dual agency |
Requirements for Dual Agency
| Requirement | Details |
|---|---|
| Written consent | Both parties must consent in writing |
| Disclosure | Must explain limitations of dual agency |
| Impartiality | Cannot advocate for either party |
| Timing | Consent must be obtained before dual agency begins |
Dual Agent Duties
| Must Do | Cannot Do |
|---|---|
| Treat both parties fairly | Disclose confidential information |
| Disclose material facts | Advocate for one party |
| Account for all funds | Reveal negotiating strategies |
| Perform ministerial acts | Favor one party's interests |
Confidentiality in Dual Agency
Information learned before dual agency begins:
- Remains confidential
- Cannot be disclosed without written permission
- Protected even during dual agency status
What Must Be Disclosed
Even as a dual agent, the licensee must disclose:
- Known material defects
- Property condition issues
- Environmental hazards
- Information required by law
Transaction Brokerage (Facilitator)
A transaction broker is a licensee who assists with a transaction without representing either party.
Transaction Broker Duties
| Duty | Description |
|---|---|
| Deal honestly | Cannot make misrepresentations |
| Account for money | Handle funds properly |
| Use skill and care | Perform services competently |
| Present offers | Deliver all offers to appropriate party |
| Disclose material facts | About property condition |
What Transaction Brokers Cannot Do
| Cannot Do | Reason |
|---|---|
| Advocate for either party | No agency relationship |
| Keep information confidential | No fiduciary duty |
| Advise on negotiation strategy | Not representing either party |
| Recommend price or terms | Would be acting as agent |
When Transaction Brokerage is Used
| Situation | Transaction Broker Appropriate? |
|---|---|
| Both parties want representation | No - use single agency |
| Neither party wants representation | Yes |
| Conflict of interest exists | Yes - alternative to dual agency |
| Commercial transactions | Often |
Comparison: Dual Agency vs. Transaction Broker
| Feature | Dual Agency | Transaction Broker |
|---|---|---|
| Represents | Both parties | Neither party |
| Written consent | Required from both | May be required |
| Confidentiality | To both parties | Limited |
| Fiduciary duties | Limited/impartial | None |
| Can advise | Very limited | No |
In-Company Transactions
When buyer and seller are both clients of the same brokerage:
| Option | Description |
|---|---|
| Dual agency | Brokerage represents both, with consent |
| Designated agency | Different agents represent each party |
| Transaction brokerage | Broker facilitates without representing either |
Key Point: Kentucky law requires disclosure of the company relationship and how it will be handled before proceeding.
Loading diagram...
Test Your Knowledge
What is required for a Kentucky licensee to act as a dual agent?
A
B
C
D
Test Your Knowledge
A transaction broker in Kentucky represents:
A
B
C
D