Agency & Ethics — Cheatsheet

Agency Types Comparison

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OLDCAR — The Six Fiduciary Duties

Duties to non-clients (the other party): honest and fair dealing + disclosure of known material facts about the property — but NOT full fiduciary duties.

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California Agency Disclosure Requirements Checklist

First substantial contact: The trigger for the AD form — first meaningful discussion about a specific potential transaction (e.g., buyer at open house asking about making an offer).

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Dual Agency — What the Agent Cannot Do

A dual agent must remain neutral and cannot:

• Disclose the seller's lowest acceptable price to the buyer

• Disclose the buyer's highest willingness to pay to the seller

• Advocate aggressively for either party's negotiating position

• Give advice that primarily benefits one party at the expense of the other

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CA Disclosure Requirements Quick Reference

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NAR Code of Ethics — Key Articles

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Prohibited Conduct Summary

Agency Type	Who Is Represented	Fiduciary Duties Owed To	CA Requirement
Seller's Agent	Seller only	Seller (full OLDCAR)	Listing agreement; AD form at first substantial contact
Buyer's Agent	Buyer only	Buyer (full OLDCAR)	Buyer rep agreement; AD form before showing property
Dual Agent	Both buyer and seller	Both (limited — no full advocacy for either)	Written disclosure + written consent from both parties
Designated Agent	One party each (within same brokerage)	Respective client (full OLDCAR per agent)	Broker is disclosed dual agent; agents represent one side each
Non-Agent / Facilitator	Neither	Honest dealing only	No fiduciary duties
Letter	Duty	Key Rule
O	Obedience	Follow all lawful instructions; refuse illegal orders (e.g., fair housing violations)
L	Loyalty	Client's interests above all others, including the agent's own financial interest
D	Disclosure	Proactively disclose all material facts — do not wait to be asked
C	Confidentiality	Protect client's negotiating info (bottom line, motivation, finances) — survives end of listing
A	Accounting	All trust funds in broker's trust account within 3 business days; no commingling
R	Reasonable Care	Perform visual inspection; advise competently; recommend specialists when needed
Document	When Required	Who Provides It
Agency Disclosure (AD) form	At first substantial contact	Seller's agent before listing; buyer's agent before showing
Agency Confirmation	In purchase agreement (before or at offer)	Both agents; signed by buyer and seller
Buyer Representation Agreement	Before showing property (NAR settlement, Aug 2024)	Buyer's agent
Listing Agreement	Before marketing the property	Listing broker
Disclosure	Trigger	Key Rule
TDS (Transfer Disclosure Statement)	Sale of 1-4 residential units	Seller + both agents complete; 3-day buyer rescission right; exemptions: REO, probate, new construction
NHD (Natural Hazard Disclosure)	All CA residential sales	Flood, fire, seismic, dam zones; typically ordered from third-party company
Lead Paint Disclosure	Pre-1978 homes	Federal requirement; 10-day inspection opportunity; EPA pamphlet required
Death Disclosure	If buyer asks	Disclose if death within 3 years; HIV/AIDS status never disclosed
Mello-Roos / CFD	Properties in CFD districts	Disclose annual assessment amount
Preliminary Title Report	Opening of escrow	Title company discloses all recorded encumbrances
Agent Visual Inspection	All 1-4 unit residential sales	Both agents independently; report any condition affecting value or desirability
Article	Subject	Rule
1	Client interests	Protect and promote client; treat all parties honestly
2	No misrepresentation	No false or misleading statements about property
10	Fair housing	No discrimination based on any protected class
12	Honest advertising	Truthful; include broker name and DRE license number
16	No soliciting	Do not solicit listings exclusively listed with another REALTOR
17	Arbitration	Disputes between REALTORS go to association arbitration, not court
Violation	Definition	Governing Law
Steering	Directing buyers/renters to or from areas based on protected class	Fair Housing Act; FEHA
Blockbusting	Inducing panic selling by implying protected class entry harms values	Fair Housing Act; FEHA
Redlining	Refusing loans/services in areas based on racial/ethnic composition	Fair Housing Act; ECOA
Secret Profit	Agent profits from transaction without client's knowledge	BPC 10176; breach of loyalty
Commingling	Mixing client trust funds with personal/operating funds	BPC; DRE regulations
Conversion	Using client funds for personal purposes	BPC; criminal fraud
Kickbacks	Undisclosed referral fees or compensation from third parties	RESPA; BPC

CA protected classes beyond federal: Marital status, sexual orientation, gender identity/expression, source of income (Section 8), ancestry, age.