Washington Managing Broker Exam — All Questions

Agency relationships between real estate licensees and the public in Washington are governed primarily by:

• a.The federal RESPA statute
• b.Common-law fiduciary rules only, with no statute
• c.Washington's real estate brokerage relationships act (RCW 18.86)✓
• d.The Uniform Commercial Code

Washington's brokerage relationships are governed by statute, RCW 18.86, which defines the duties a licensee owes to buyers and sellers, sets out how agency is created, and addresses dual agency. This statute largely replaces common-law agency for Washington real estate licensees.

Under RCW 18.86, a Washington licensee who has no written agreement establishing representation is presumed to be:

• a.The buyer's agent in every case
• b.Acting for the party with whom the licensee is working, with agency determined by the statute's default rules✓
• c.A dual agent for both parties automatically
• d.An unlicensed facilitator with no duties

RCW 18.86 sets default agency based on the facts of the relationship rather than assuming a fixed role. The statute specifies the duties owed to all parties (such as honesty and disclosure of material facts) and the additional duties owed to a represented principal. Written agreements clarify who is represented; absent one, the statute's default rules apply.

In Washington, a licensee may act as a dual agent representing both buyer and seller in the same transaction only when:

• a.The transaction is commercial rather than residential
• b.The managing broker personally approves each showing
• c.Neither party has independent counsel
• d.Both parties consent after the licensee discloses the dual-agency relationship as required by RCW 18.86✓

RCW 18.86 permits dual agency only with the informed consent of both the buyer and the seller after disclosure. A dual agent must not disclose one party's confidential negotiating information to the other. Consent and the limits on the licensee's duties must be documented.