Florida Real Estate Brokers
During the 1998 legislative session Florida lawmakers made changes in the law of agency as it applies to real estate brokers. During the 1998 legislative session, Florida legislature enacted additional amendments to Chapter 457 to address some of the shortcomings of the 1997 amendments. Governor Lawton Chiles signed the changes into law May 27, 1998, and they took effect on July 1, 1998. After the elimination of dual agency in 1997, real estate brokers have been concerned how they would address conflicts of interests for different agents within the same real estate firm that find themselves on opposite sides of a real estate transaction.
Provided as an educational service by John Raymond Dunham, III, Esq..
In response, the legislature addressed this concern where non-residential real estate is involved by allowing for a “designated salesperson” to be utilized under certain circumstances. Florida Statutes § 475.2755 provides: “In any real estate transaction other than residential sale. . . and where the buyer and seller have assets of $1 million or more, the broker, at the request of the customer, may designate salespersons to act as single agents for different customers in the same transaction. Such designated salespersons shall have the duties of a single agent, including disclosure requirements in § 475.275(3)(b) and (c) .”
This provision only applies to sales other than residential and where the buyer and seller have assets of $1 million or more. The intent of legislature is to allow sophisticated commercial clients the option of being represented by a licensee within the same office as a licensee representing the other party to the transaction if appropriate disclosures are made.
The changes provide for a new disclosure statement to be signed by both buyer and seller indicating that their assets meet the required threshold and that they are requesting that the broker use the designated salesperson form of representation. The required disclosure provides that the designated salesperson cannot disclose confidential information except to the broker or persons specified by the broker. The broker must hold this information confidential and may not use this information to the detriment of the other party.
The Florida legislature also included a change in the duties of the licensee in disclosing material facts affecting the value of real property. Currently, a licensee in representing a buyer and seller as a transactional broker is required to disclose material facts affecting the value of any type of real property. The new amendments provide that when a licensee is acting as a transactional broker, it is only required to disclose facts that materially affect the value of residential real property.
The changes in the agency law in 1997 have clarified the relationship between the client and the licensee. The changes enacted in 1998 are designed to resolve conflicts of interests that have arisen with real estate firms who have been asked by both a buyer and a seller to represent them in a real estate transaction.
This publication is intended to serve you. If you would like certain topics covered, or have any questions or comments, you are invited to contact Mr. Dunham at: 941.951.1800, Ext. 250, Facsimile: 941.366.1603, E-Mail: firstname.lastname@example.org, Web site: www.jrdlaw.com or write him at LUTZ, BOBO, TELFAIR, DUNHAM & GABEL, Two North Tamiami Trail, SARASOTA, FLORIDA 34236.
This publication is designed to provide accurate and authoritative information in regard to the subject matter covered and report on issues and developments in the law. It is not intended as legal advice, and should not be relied upon without consulting an attorney.