In dual agency, what is a primary characteristic?

In dual agency, a primary characteristic is that undivided loyalty to both parties is legally impossible. This concept is crucial because, in dual agency, one agent represents both the buyer and the seller in a transaction. This situation creates a conflict of interest, as the agent is expected to act in the best interests of both parties simultaneously, which can compromise loyalty.

Under normal agency relationships, an agent owes undivided loyalty to their principal, but in dual agency, this is not feasible. The agent must remain neutral, and this neutrality can lead to situations where the agent cannot fully advocate for one party without potentially disadvantaging the other. Therefore, recognizing that undivided loyalty is impossible in a dual agency situation is essential for understanding the complexities and potential conflicts that arise within this type of relationship.

Other options suggest scenarios related to agency that do not accurately describe the nature of dual agency. An agent can represent both parties if both consent, and it is not a requirement for each party to have their own independent agent. The agreement of both parties to use a single agent is indeed a characteristic of dual agency, but the critical aspect that stands out in determining the characteristics of dual agency revolves around the conflict of interest regarding loyalty.