Limited dual agency

Key Takeaways

• A limited dual agent is a broker who has an agency relationship with both the buyer and the seller in the same transaction (RCW 18.86.010).
• Written consent from both parties, set forth in the services agreement, is the only route to limited dual agency in Washington (RCW 18.86.060).
• The consent is separately initialed and acknowledges that a limited dual agent may not advocate terms favorable to one principal to the detriment of the other (RCW 18.86.020).
• When different brokers affiliated with the same firm represent different parties, the firm's designated broker and any managing broker supervising both brokers is the limited dual agent (RCW 18.86.060).

What It Means

Limited dual agency is one broker representing the buyer and the seller in the same deal, and the word limited is the operative part. A broker on one side owes that principal undivided loyalty. A broker on both sides cannot, because the two interests point in opposite directions on price and terms. Washington's answer is not to ban the arrangement but to shrink the duties and require both parties to agree to the shrinking in writing.

A limited dual agent takes no action adverse or detrimental to either party, discloses conflicts of interest to both, advises each to seek expert advice on matters beyond the agent's expertise, and never discloses Confidential Information from or about either party, except under subpoena or court order, even after the relationship ends. What the agent gives up is advocacy. A limited dual agent may not push for terms that favor one principal to the detriment of the other, so there is no arguing the buyer's price case to the seller and no hinting at what either side would really accept.

Neutrality is not silence. The duties owed to every party in a transaction, including honest dealing and disclosure of known material facts, are untouched by dual agency. Only advocacy and the two principals' confidences are walled off.

How It Works in Washington

In Washington, consent decides everything. RCW 18.86.060 says a broker may act as a limited dual agent only with the written consent of both parties to the transaction, set forth in the services agreement. RCW 18.86.020 puts that consent into the agreement as a separately initialed item, with the principal acknowledging that a limited dual agent may not advocate terms favorable to one principal to the detriment of the other. The same section asks for a second consent, covering the firm's Designated Broker and any supervising managing broker acting as limited dual agents when different brokers of the same firm sit on opposite sides of one deal.

That second consent matters more than students expect, because RCW 18.86.060 makes the designated broker and any managing broker responsible for supervising both brokers a limited dual agent in exactly that situation, while each appointed broker keeps representing only their own principal. The duties themselves are capped: unless additional duties are agreed to in writing, they are the duties in RCW 18.86.030 owed to all parties plus taking no action adverse or detrimental to either party, timely disclosure of conflicts, advice to seek expert help, and confidentiality that survives termination. The statute also clears away some false conflicts, providing that showing competing properties, listing competing properties, and presenting additional offers on a property already under contract are not by themselves adverse to a principal. The status still has to appear in writing before the parties reach mutual agreement, in a separate paragraph titled Agency Disclosure (RCW 18.86.030(1)(g)). Our guide to Washington's written services agreements shows where those initials go.

Example

A Kirkland firm lists Simone's house at $845,000, with Teo as the appointed broker. Nadia, a buyer Teo has worked with before, wants to write on it. Both sign services agreements with the firm that separately initial the limited dual agency consent, so Teo may represent them both in this transaction.

Nadia offers $820,000 and tells Teo she would pay $850,000 rather than lose the house. Teo cannot pass that number to Simone, and he cannot argue Nadia's case for the lower price either. He presents the offer, presents Simone's counter at $838,000, and confirms both sides received the pamphlet and the written agency disclosure. Nadia accepts at $838,000, which is $18,000 above her offer and $7,000 under the asking price. A week later Teo learns the crawl space has standing water. He discloses it to Nadia, because disclosure of known material facts is owed to every party under RCW 18.86.030 and dual agency does not touch that duty.

Common Mistakes and Exam Traps

• Limited dual agency is lawful in Washington, so an answer calling it prohibited is wrong; what RCW 18.86.060 requires is written consent from both parties in the services agreement.
• Consent is separately initialed inside the services agreement, so a verbal agreement at the kitchen table or a handshake at closing does not satisfy the statute.
• A limited dual agent still owes every party the duties in RCW 18.86.030, so neutrality is never a reason to withhold a known material fact.
• When two different brokers at one firm take opposite sides, neither becomes a dual agent; the designated broker and any managing broker supervising both is the limited dual agent.