Alaska real estate associations are proposing changes to the state's dual agency disclosure statutes, which are put in place to protect consumers and lower agent liability.

A successful consumer lawsuit against a dual agent and broker in Alaska is causing the state real estate association to rethink the clarity of its agency disclosure statutes. While the judgment against the agent indicated that the judge felt that the agent deliberately chose to ignore statutes regarding the proper timing of disclosure, some Realtors across the state suggest that parts of the statutes are "cumbersome in timing and paperwork flow."

On Thursday, a task force appointed by the Kachemak Board of Realtors looked into proposed legislative changes for Alaska SEC.08.88.396. The task force is also known as the Alaska Association of Realtors’ Agency Task Force.

Said spokesperson Mark Korting in the report, a RE/MAX broker and co-chair of the Alaska Association of REALTORS' Agency Task Force, "We're already hearing firsthand stories from Prudential salespeople who are being asked questions by the public when they go out on listings. We're concerned about how this looks for our profession."

He also stated, “Probably half of the real estate business done in Alaska is through dual agency. At best, our statutes are hard to comply with 100 percent. There's a glitch or two in the wording."

While admitting that practitioners have “gotten lazy,” Korting also suggested that the laws are badly written, and that “some of the procedures are unwieldy and cumbersome in timing and paperwork flow.”

In Alaska, agents must present two disclosures – one to announce the agent’s agency status and a second disclosure of new agency status once the principals have agreed to dual agency. The task force proposed such changes as eliminating the words “in writing” for disclosing to a buyer the agent’s relationship with the seller in the first disclosure, deleting certain words from the statute including the word “agency” when describing the relationship with the seller when disclosing the buyer, and replacing disclosure to “a” buyer instead of to “each” buyer. In Alaska, dual agency does not begin according to statute until both the buyer and seller have agreed to the arrangement in writing. The task force is asking that the written confirmation of consent shall be obtained “as soon as possible” after the establishment of the dual agency.”

Reasoning for the proposed changes, among others, include “affording the licensee the flexibility to comply with statutory requirements without driving away a prospective client or customer.” The changes also address ‘incongruent and illogical” paragraphs such as the moment in time an agent must disclose that he or she is an agent of a seller or sellers, that it is the same moment that he or she begins to act as though he or she is also representing the buyer. The task force also says that agency is created by actions, not by intentions, assumptions or compensation. Finally, the task force insists that discussions of agency “beyond the required disclosure is a matter of agent judgment, principles of practice, and interest of the client or customer.

When the task force agrees on the proposed changes, they will be recommended to the state legislature and the state real estate commission as modifications to definitions and actions required or allowed in dual agency.

Spokespersons for the task force and the associations did not return phone calls or e-mail requests for comment.

Published: October 14, 2002

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