As an agent, we have a fuduciary duty to protect our clients, but how much of this do we take into our own hands?
What if an agents bad judgement/actions crashed a deal but they thought they were doing the best for their client?

Do you let your seller or buyer make every decision? Provide them as much information, stories and experiences and then let them decide what route to take? or do you ask them their ceiling or floor price and then take the reins, and let them accept the outcome whether good or bad?

I would go with the route that gives your clients the most information possible for them to make their own decision. Of course, you should give them recommendations and previous experiences but then you should really let them make their own decisions....perhaps stating it like "Mr. Seller, based on what I recommend what course of action would you like to pursue?? This way you are being very informative, giving recommendations but not telling them or forcing them into action.

There is a huge difference between being an agent and an attorney. Agents give advice, then let the client make the decision and the agent acts based on their instruction. Agents do not make decisions on behalf of the client- that is what an attorney is for. I didn't go to enough college for that nor do I get paid enough for that sort of liability. I would NEVER EVER decide for a client what their offer should be. It is ALWAYS their decision. All I can do is give them my opinion and advice and hope they trust me enough to listen to them.

Do you have a specific situation you can share to give us more to work with? I have helped my clients make decisions when they clearly wanted me to - for example - when talking about pricing a listing or making an offer; if they aren't willing to make the decision, I'll say "Well, let's do $255,000 - how about that?" Or, "Let's ask for the refrigerator, too."

It's a fine line, especially when a commission check is on the line. No one admits it, but it's awfully tempting to push someone to make a decision that makes it more likely you'll get paid, even if it may not be the very best thing for the client. I see agents asking all the time: "What should I advise in this or that situation - I really NEED this to close!"

That, of course, is bad!

This is the fly in the ointment, as clients are inclined to rely on the recommendation of their agent and their agents knowledge and experience.

An agent in a fiduciary relationship may be influenced by the possibility of earning a commission, provided a transaction is completed.

Unlike an attorney who may be compensated on the basis of their time, knowledge and experience, whether successful at trial or not, a real estate agent in most cases is only compensated upon the successful completion of a transaction and that may give rise to a conflict of interest, between the agent’s interest and the client’s interest.

If an agent, utilizing due diligence exposes various elements of risk to their client, there is a distinct possibility that their client may not proceed with the transaction and all the agents time and effort are for naught.

Attorney’s generally prefer to act upon the clients express instructions, and document everything in the event a complaint may be filed against them with the law society that governs their actions and knowing that they may have to justify everything that transpired in relation to their clients file.

An agent, then may be well advised to follow the same course of action as an attorney, in order to cover his or her assets.

Unless, there is documented evidence to the contrary, a situation could arise concerning the credibility of the two opposing parties.

On one side you have the agent denying all liability, claiming all decisions were made by the clients and on the other side you have the clients claiming that their decisions were based on their agents recommendations and that their agent misrepresented the facts to them and thereby breached their fiduciary duty to their clients.

In any event, where there are unresolved issues, the agent may become involved directly or indirectly in some form of litigation and with some other knowledgeable professional examining everything that the agent did or failed to do.

It would be beneficial to an agent if they had done their due diligence and documented their full disclosure of all positive and negative elements connected with the transaction and that the client proceeded with the transaction with the full knowledge of all material and relevant matters.

Especially when the final decision may rest with a judge

Important Notice: This information is provided as basic educational information by the author and is not a substitute for the advice of an expert and/or the advice of a lawyer. There is NO representation as to legality, accuracy, correctness of the herein information and the reader is strongly urged to consult a lawyer in the relevant jurisdiction to ensure accuracy before acting on this information .

in the first situation, the agent may have exercised poor judgement, and may have liability for his actions. the client may also have liability for his agent's actions, if improper.

of course the client makes all decisions within their control. this should never be in question, as the client is your employer. if you are uncomfortable with the client's instructions or decisions, you may unilaterally cancel your employment agreement with the client.

Shana's opinion is concise and correct. We all have fiduciary duties to our clients, but we are only "opinion givers" and "advisers" at the end of the day. Our experience can be a tremendous asset to help guide a transaction to closing, however, it should be the client who makes all of the final decisions. Yes it is frustrating at times, but educating and explaining about some prior experiences should frame the client's perspective to make "reasonable" decisions and choices.

Although it is a fine line, agents that stray from "advice giving" and enter into the world of "decision-making" for their clients are potentially setting themselves up for some serious legal and ethical issues. An agent's job is to provide a buyer/seller with as much useful info as possible, and help to steer him or her in the direction of good options that fit his/her desires. However, the actual decision must always be left up to the buyer/seller.

I actually think the roles of an agent and a lwyer are very similar in that the client really does have the last word. Both roles are meant to give the client access to "expertise". I believe that a good agent does a lot of work the client never knows about but the "reins" are still firmly in their hands. We often forget that the agent doesn't really sell a product (house) but provides a service to the client.