Explanations

• In real estate, an agent’s primary responsibility and fiduciary duty are owed to their principal or client. A fiduciary relationship is built upon trust and requires utmost care, obedience, accounting, loyalty, and disclosure of material facts.
• A cooperating agent (or broker) is a licensee who finds a buyer for a property listed with another agent.
• When a buyer’s agent (cooperating broker) enters a transaction where a listing agent already represents the seller, the buyer’s agent effectively becomes a subagent to the deal.
• Even if the principal (seller) is not directly notified by the original broker about the cooperating broker, the cooperating broker, acting as a subagent of the listing broker, implicitly owes fiduciary duties to the original principal (the seller). This is because the subagent is working to fulfill the duties of the main agent, who is directly accountable to the principal. Information known by the subagent is also presumed to be known by the principal due to the imputed knowledge rule.

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