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DBrief Episode 06: Agency Substitutions and Team Scenarios

Welcome to 2024! As we embrace the New Year, it's essential to reflect on the diligent preparation Washington brokers have undergone to ensure a seamless transition into 2024's real estate landscape. In this episode of DBrief, Washington REALTORS® Legal Hotline Lawyer Annie Fitzsimmons shares additional helpful tips aimed at Designated Brokers and those responsible for training and managing real estate professionals, particularly regarding agency law changes taking place in 2024. 

There are significant legal changes impacting real estate transactions: the mandatory naming of brokers in brokerage service agreements. This legal requirement, now embedded in law, dictates that every agreement between a firm and a consumer must clearly identify the specific broker representing them, whether for selling or buying.

Handling Broker Absences
A notable challenge raised by brokers concerns situations where a broker, already bound by an agency agreement, needs a temporary substitute due to unforeseen circumstances like vacation or medical leave. There's a straightforward solution: amend the agency agreement. Annie emphasizes using specific forms – Form 18 for listing brokers and Form 41A for buyer brokers – to temporarily assign a new agent. Importantly, these amendments can include limiting terms to ensure the substitution aligns with both the broker's and the client's objectives.

Flexibility Within Team Structures
Annie further delves into complexities within team structures in real estate firms. The question at hand was how to draft agency and listing agreements that allow flexibility for team leaders to generate business and delegate responsibilities within the team. This topic, while intricate due to the unique nature of each team, is critical for ensuring smooth operational flow and compliance with legal standards. Recognizing the complexity of these issues, we are appealing to YOU for industry input. Annie encourages brokers to email their specific team scenarios to legalhotline@warealtor.org. This collective input aims to aid discussions with Department of Licensing staff, ensuring that future guidance is comprehensive and relevant to a broad range of real estate teams.

A Call for Continued Collaboration
As we step into 2024, we'd like to thank all real estate brokers for their hard work and dedication to the industry and would like to reaffirm Washington REALTORS® commitment to supporting our members, encouraging continuous dialogue and the sharing of challenges and solutions.

Adaptability, legal compliance, and industry collaboration sets a positive and proactive tone for the year ahead. Stay tuned for future DBrief episodes where these discussions will be further explored!

The Legal Hotline is a Washington REALTOR® Member only benefit. These posts, podcasts and videos are intended for Washington REALTOR® members. None of the information contained herein constitutes legal counsel. Opinions expressed in the Q & A's and any articles posted are those of the contributors. Always check with your managing or designated broker to comply with your brokerage's practices. If you have questions and are a primary member in good standing with Washington REALTORS®, visit www.warealtor.org to contact the Legal Hotline Lawyer. You will need your M1 ID and password to inquire with the Legal Hotline or search the database.