A real estate broker operates under which legal relationship when they have fiduciary responsibilities to a client?

A real estate broker operates under a general agency relationship when they have fiduciary responsibilities to a client. In this legal relationship, the broker acts on behalf of the client and has the authority to perform a range of tasks that serve the client's best interests in a real estate transaction.

General agency entails that the broker is not just limited to a specific task, but can manage multiple areas of the client’s transactions, illustrating a deeper level of trust and responsibility. This includes obligations such as loyalty, disclosure, confidentiality, and accounting, all of which are essential to fulfilling the fiduciary duties owed to the client. The general agent’s role is to act and represent the client actively in many aspects of the real estate process.

Other relationships present in real estate, such as special agency and sub-agency, have more limited authority and do not encompass the full range of fiduciary duties that a general agent would possess. An independent contractor relationship, while common in real estate professions, does not convey the same fiduciary responsibilities that a general agency relationship implies.