Fact Pattern: A buyer’s agent accompanies a buyer to preview a property listed for sale. Months later, the listing is about to expire. The listing agent has a safe harbor period that protects the listing agent’s commission for 180 days after the expiration of the listing for buyers who have previewed the property or have written an offer (see paragraph 3A(2) of C.A.R.’s Residential Listing Agreement). The listing agent wants to put that buyer’s name on a Notice of Prospective Buyers (NPB) to give to the seller.

Multiple Choice Question: Which one of the following statements is true? Pick the best answer:

A. The listing agent can require the buyer’s agent to disclose the buyer’s name.
B. The buyer’s agent has the right to give the buyer’s name to the listing agent.
C. The buyer’s agent may have a duty of confidentiality to the buyer that prevents the buyer’s agent from disclosing the buyer’s name.
D. The buyer’s agent can give the buyer’s name to the listing agent if both agents work for the same brokerage. 

Answer: Answer A is wrong. It’s not a true statement. A listing agent can always ask, but there is no law or MLS rule that requires a buyer’s agent to disclose the buyer’s name to the listing agent. This is a good reminder to listing agents to do what you can to get the names of buyers during your listing period, such as by asking questions or by using sign-in sheets. However, be careful not to demand that people sign in before their showing, because that could raise fair housing and other issues.

Answer B is not a true statement either. It’s true that buyers’ agents are not bound to the strict confidentiality requirements for doctors, attorneys, and others. However, buyers’ agents do have a fiduciary duty to do what is in the best interest of their clients. That fiduciary duty could include a duty of confidentiality. We do not know what the scope of that confidentiality obligation may be in any given situation. But in practice, it would be easy for a buyer to claim that you, as the buyer’s agent, did not have the right to disclose the buyer’s name to the listing agent, absent the buyer’s written permission (see also Answer C below).

Answer C is the correct answer. Buyers may have certain expectations that their agent will keep their identity confidential when they are previewing properties. Buyers may be high-profile individuals or other people who want to maintain their privacy if possible. We do run into situations involving prospective buyers who do not want the seller, or their own spouse, family, or employer, to know (just yet) that they are looking to buy something. As that buyer’s agent, you should not disclose the buyer’s name without the buyer’s written permission.

However, when a buyer writes an offer, the buyer’s agent informs the buyer in writing that the seller and listing agent may decide not to keep the buyer’s offer confidential (see C.A.R.’s Possible Representation of More Than One Buyer or Seller (PRBS)). To avoid disclosure, a buyer can, before submitting an offer, ask the seller’s side if they are willing to sign a confidentiality agreement (such as C.A.R.’s Confidentiality and Non-Disclosure Agreement (CND)).

Answer D might be a true statement in certain circumstances, but it’s not the best answer. It’s possible that a buyer may feel comfortable sharing his or her identity with the listing agent if the listing agent works for the same brokerage as the buyer’s agent. However, when a listing agent and buyer’s agent work for the same brokerage, that’s a dual agency situation. A dual agent cannot disclose a client’s confidential information to the other party, absent that client’s written permission (see C.A.R.’s Agency Disclosure Statement (AD)).

-Thank You to Kalia Rork (Santa Barbara Office) for suggesting this week’s legal tip!

Copyright© 2024 Berkshire Hathaway HomeServices California Properties (BHHSCP). All rights reserved. Any unauthorized reproduction or use of this material is strictly prohibited. This information is believed to be accurate as of March 18, 2024. It is not intended as a substitute for legal advice in individual situations, and is not intended to nor does it create a standard of care for real estate professionals. Written by Stella Ling, Esq.