When two clients sign the Agreement Regarding Conflict of Interest Between Clients, one client must agree to be released by the licensee. This client is identified on the form as the Released Client.
After the clients have signed the agreement, the licensee should:
- Give the Released Client a Disclosure of Representation in Trading Services form and a Disclosure of Risks to Unrepresented Parties form confirming that going forward, the licensee would be dealing with them as an unrepresented party.
- Encourage the Released Client to seek independent representation.
The licensee can offer the Released Client a referral to another licensee. However, it is up to the Released Client to decide whether they want to be represented in the transaction. If the Released Client chooses to remain unrepresented, the licensee may work with them as an unrepresented party.
However, licensees should consider the risks of working with a Released Client as an unrepresented party:
- A dissatisfied buyer may allege that the licensee still acted as though they were in an agency relationship.
- Alternatively, a dissatisfied seller client may allege that the licensee acted still acted as though they were an agency relationship with the unrepresented buyer.
- Either party may allege that the licensee shared their confidential information with the other party.
Published on Jun 01, 2018