Broker's Agent Confusion

There appears to be a lot of confusion about a Broker's Agent among real estate agents.

The license law defines such an agent at RPL 443(1)(k) as follows:

“Broker’s agent” means an agent that cooperates or is engaged by a listing agent, buyer’s agent or tenant’s agent (but does not work for the same firm as the listing agent, buyer’s agent or tenant’s agent) to assist the listing agent, buyer’s agent or tenant’s agent in locating a property to sell, buy or lease respectively, for the listing agent’s seller or landlord, the buyer agent’s buyer or the tenant’s agent tenant. The broker’s agent does not have a direct relationship with the seller, buyer, landlord or tenant and the seller, buyer, landlord or tenant can not provide instructions or direction directly to the broker’s agent. Therefore, the seller, buyer, landlord or tenant do not have vicarious liability for the acts of the broker’s agent. The listing agent, buyer’s agent or tenant’s agent do provide direction and instruction to the broker’s agent and therefore the listing agent, buyer’s agent or tenant’s agent will have liability for the broker’s agent.

Interestingly, a broker's agent should not have a client, but only a customer as the term customer is commonly utilized in the industry, albeit not defined by License Law.

The license law defines a client as follows:

Client - The one by whom a broker is employed.

As a result, the definition of Broker's Agent does not permit for a client because it states that a broker's agent is "engaged by" (otherwise known as employed) the "listing agent, buyer’s agent or tenant’s agent" and not by a vendor or vendee. Yes, technically the agent who employs is the client, but DOS Opinions clearly state that a real estate agent needn't make a formal disclosure by way of the form to another real estate agent working on the same matter. Therefore, the agency disclosure form is only necessary to customers (those who the broker's agent is attempting to procure for the deal).

Moreover, the definition of Broker's Agent mentions "vicarious liability", but agents misinterpret this to be their liability and specifically, their insulation from liability. It is not. Instead its the "seller, buyer, landlord or tenant"('s) liability is at issue, not the real estate agents. To be clear, if you are a broker's agent, you can be liable for your wrongs. If you are a seller's agent or buyer's agent who engages a broker's agent, you can be liable for their acts. All the statute states is that a client who has a broker's agent working on their matter in addition to their own real estate agent is not liable for that broker's agent's misconduct.