Q: When we were looking to purchase a house, a real estate agent showed us approximately 15 or 20 homes on the multiple listing service. This agent then represented us in our negotiations to purchase the home we decided upon. Our agent received a commission from the sellers' proceeds.

Our agent informed us that she was a "buyers' agent", in that she was representing our interests as against the seller. Can an agent represent the buyer, and can they represent both the buyer and the seller?

A: It has been written that "No servant can serve two masters, for either he will hate the one and love the other or else he will hold to the one and despite the other."

The law is quite clear that a broker cannot act as the agent for both parties in the same transaction, unless all of the following conditions are present. The broker (or agent) must employed by both parties. The fact that the agent is representing both parties must be made known to the parties in a clear and unambiguous manner.

Additionally, the agent is permitted to act in a dual capacity when nothing is left to the discretion of the agent, no special confidence is given the agent, and the only purpose of the agent is to bring the parties together.

In your letter, you also discuss what you call a growing trend toward the "buyer's agent" and ask about the propriety of such an arrangement. There is nothing wrong wth retaining an agent to represent your interests, and paying that agent for services rendered to you. However, as you can fully appreciate, if your agent's fee is dependant upon the sales price of the house, your agent has a built in conflict of interest, and this is a situation which may well lead to trouble.

You have every right to rely on a real estate agent, but you as the buyer must understand that your interests and those of the agent may be in conflict with each other.