FACTS:

An agent transferred his license to a new brokerage firm. The agent provides property management services, but does not execute the AAR Real Estate Agency Disclosure and Election form (the “READE form”) between himself and the landlord. The agent’s new broker would like the agent to execute the READE form when the agent executes the Property Management Agreement form with the landlord.

ISSUE:

Should the READE form be used when entering into a Property Management Agreement?

ANSWER:

See Discussion.

DISCUSSION:

The READE form states: “Before a Seller or Landlord (hereinafter referred to as “Seller”) or a Buyer or Tenant (hereinafter referred to as “Buyer”) enters into a discussion with a real estate broker or licensee affiliated with a broker, the Seller and the Buyer should understand what type of agency relationship or representation they will have with the broker in the transaction.” (emphasis added).

A real estate agent is obligated to discuss agency issues with their client at the beginning of the representation and confirm his/her representation in writing before any contracts are executed.

The AAR READE form is designed to help agents explain agency issues to their sellers, buyers, landlords and tenants and to provide those discussions in written form. Inasmuch as the agent’s broker has requested that the agent use the READE form, the agent should comply with the broker’s request.