No Delivering or Receiving Notices in Multiple Representation
"When brokerage represents both the Seller and the Buyer (multiple representation) the brokerage is not entitled or authorized to be an agent for either the Buyer or the Seller for the purposes of giving/receiving notices".
Why not? And who then will be giving/receiving notices? Lawyers?
Bill is selling and Mary is buying. They both are friends with Bob and use Bob as their agent in the deal.
Mary submits an Offer and it includes a Condition on Financing. She is very hopeful to get confirmation, which she expects first thing Monday morning, However, it’s Sunday night, Bob, her next door neighbor comes over and she explains that she is just waiting for confirmation from her mortgage Broker. Bob says: “just sign this, I won’t turn it over until tomorrow after I hear from you”. Or, Bob could have said: “I won’t be seeing Bill until the afternoon, so, if anything comes up, call me…”. (note, both are slightly different in terms of onus)
8:00 pm, Sunday, she signs
9:00 am, Monday, she is advised that she has been turned down
So, the question really becomes: WHEN was the effective time of delivery and receipt?
Bill might argue that the 8:00 pm time is effective, that is, when it was effectively received by his Agent Bob on his behalf.
Under the first scenario, Mary might argue that the delivery to Bob had never actually taken place at all, since the document was “in escrow”.
However, under the second scenario, she doesn’t have that same argument.
The problem is that Bob is BOTH the person who delivers and the person who receives. This could cause problems.
So, there are essentially two routes here:
- Someone, other than Bob fulfills the role, like the parties themselves or their lawyers, or
Bob is simply a messenger, he picks up the document from Mary, but he’s just the courier, it’s not delivered to Bill, until he actually hands the document over to Bill.
The rule is designed to remove Bob from being “caught in the middle” and responsible to two people at the same time, when “timing” is so critical in contract administration.
Brian Madigan LL.B., Broker