AB 1059: Dual agency: commercial real estate transactions.

Existing law, the Real Estate Law, provides for the licensure and regulation of real estate brokers and real estate salespersons by the Real Estate Commissioner. Under existing law, a real estate broker is a person who, for compensation or in expectation of compensation, does or negotiates to do specified acts relating to a real estate transaction. Under existing law, a real estate salesperson is a person who, for compensation or in expectation of compensation, is employed by a licensed real estate broker to do specified acts relating to a real estate transaction.

Existing law requires listing agents and selling agents to provide the seller and the buyer in a real property transaction, including any commercial property, with a copy of a specified form that contains required disclosures regarding a real estate agency relationship. Existing law authorizes a real estate agent, including a licensed real estate broker, either acting directly or through one or more associate licensees, meaning a person who is licensed as a real estate broker or real estate salesperson, to be the dual agent of both the seller and the buyer in a real estate transaction only if he or she obtains the knowledge and consent of, and makes certain affirmative obligations to, both the seller and the buyer. Existing law prohibits a dual agent from disclosing to the buyer that the seller is willing to sell the property at a price less than the listing price without the express written consent of the seller. Existing law also prohibits a dual agent from disclosing to the seller that the buyer is willing to pay a price greater than the offering price without the express written consent of the buyer.

This bill, with respect to a commercial real estate transaction, would prohibit an agent from acting as a dual agent in a commercial real estate transaction. The bill would prohibit a brokerage firm, broker, or any of its associate licensees from acting as an agent for both a seller and a buyer in the same commercial real estate transaction. The bill would prohibit a brokerage firm, broker, or any of its associated licensees from acting as a dual agent in connection with its representation of any principal. The bill would define various terms for purposes of carrying out these provisions.