Transactional Brokerage

Transactional Brokerage and Facilitation under Massachusetts Law

Effective July 1st, 2005, legislation was passed in Massachusetts giving greater definition to the roles and responsibilities of all licensees and expanding the number of relationships available to the public with licensees.

Below is a comparison of the duties of agents under the new law and the duties of the transaction broker, also known as facilitator.   We at Harsch Associates have further defined, as permitted under state law, the precise duties and nature of the services we provide under facilitation.

Agent’s Duties to client as stated in the Massachusetts Mandatory Licensee-Consumer Relationship Disclosure

1. undivided loyalty
2. reasonable care
3. full disclosure
4. obedience to lawful instruction
5. confidentiality
6. accountability
7. client’s interests come first in negotiating best price and terms

Note: Client is vicariously liable for the acts of their agent and sub-agent

Agent’s Duties to consumer under the law

1. present property honestly and accurately
2. full disclosure of known condition and defects
3. demonstrate level of skill and knowledge expected of licensee
4. accounting of funds entrusted

Facilitator/Transaction Broker Duties to consumer as defined by Massachusetts statute and by Harsch Associates' company policy

1. present property and buyer qualifications honestly and accurately
2. full disclosure of known property condition and known defects
3. full accounting of funds
4. demonstrate skill and knowledge appropriate to profession
5. on request, provide current market data to the parties to assist them in formulating a suitable listing price or offering price
6. maintain confidentiality for the parties to the transaction
7. use all reasonable efforts to locate a suitable buyer or property
8. assist the parties to reach agreement on the terms of the transaction without having the duty to pursue the interests of one party over the other

Note:   There is no vicarious liability exposure to the consumer within a facilitator/transaction broker relationship

Following are the various types of relationships that can occur between consumer and licensee within the same transaction:

1. Seller’s Agent
   1. Buyer is unrepresented
   2. Buyer is represented by buyer’s agent from a different firm
   3. Buyer engages the services of a facilitator/transaction broker
2. Buyer’s Agent
   1. Seller is unrepresented
   2. Seller is represented by seller’s agent (different firm)
   3. Seller has facilitator/transaction broker assisting
3. Designated Agency
   1. Buyer has a designated buyer’s agent within a firm
   2. Seller has separate designated agent within the same firm
   3. Buyer or seller may alternatively elect facilitation/transaction brokerage assistance while other party has an agency relationship within same firm
   4. Buyer or seller may be unrepresented while other party has agency relationship within same firm
4. Disclosed Dual Agency
   1. Buyer and seller have entered into agency relationships within a single agency firm (not Designated Agency firm) and end up in the same transaction and consent to dual agency, thus yielding certain agency duties otherwise available, namely items 1 and 7 on previous page under Agent's Duties.
5. Facilitation/Transaction Brokerage
   1. Buyer and/or seller may have a facilitator relationship with licensee either within the same firm or in separate firms.   No conflicts exist.   Facilitator may work with unrepresented consumer or other party’s agent.