California Real Estate Practice Exam

An agent may represent both parties in a transaction, providing he:

1. discloses his commission agreement with both parties

2. gets consent of both parties

3. informs both parties

4. all of the above

The correct answer is: discloses his commission agreement with both parties

The correct answer is that an agent may represent both parties in a transaction as long as he gets the consent of both parties. This is crucial because dual agency situations, where an agent represents both the buyer and the seller, require transparency and explicit agreement from both parties involved. In the context of real estate practices, dual agency is permitted under California law but comes with specific obligations. The agent must ensure that both parties are fully aware of and consent to the dual relationship, which helps to avoid any conflicts of interest and assures that the needs and interests of both parties will be handled fairly. While disclosure of the commission agreement might be important, it is secondary to the essential requirement of obtaining consent. Similarly, informing both parties about the dual agency is necessary but does not replace the need for their explicit agreement. Thus, while these actions may be part of the agent's responsibilities, the central condition for a dual agency is that consent must be granted by both parties involved in the transaction.