Agency Law for Illinois

For years and years (“good ole days”) buying a home through a real estate agent was similar to going to Sears to buy a stove: you were not legally represented by the agent with whom you were working. Since the Seller usually paid the commission and the listing broker shared that commission with the selling broker, the buyer’s “agent” was in fact a subagent of the Seller. In the 90’s a class action law suit (dual agency) involving one of the largest brokerage firms in the country resulted in a settlement rumored to be a bunch of money. Agency immediately became of great interest and concern for both real estate companies looking to avoid similar problems and state governments.

Today all states have laws defining real estate agency: buyer agency, seller agency, and dual agency, although some still allow for “facilitators,” where no agency has been established. Agency laws define the relationship between the agent and his client, or principle, and the duties of each. Illinois has, by statute, established the duties of the agent to the clients: care, obedience, accounting, loyalty, confidentiality, and disclosure (remember the Boy Scout oath?). The simple rule is that, excepting unlawful demands, the client’s interest must be placed above the agent’s interest. The client would be obligated to treat the agent honestly, cooperate toward fulfilling the goal for which the agency was formed, and to compensate the agent as agreed.

The Illinois License Act of 2000 (Article 15) lays it out in detail and can be found most easily at http://law.justia.com/illinois/codes/chapter24/23835.html (it took me quite a while to find it at the State of Illinois General Assembly site and the URL runs off the page).