Fiduciary Duty

• Fiduciary duty to a client is the practice of keeping the confidential terms of a real estate transaction between the agent and the client. A good example of fiduciary duty is when an agent knows what a seller will take as a "bottom line" price on a property but does not disclose that information to a buyer in negotiations unless directly instructed to do so by the seller.
  
  

NAR Code of Ethics

• A real estate professional is expected to act ethically during a real estate transaction. This means that he cannot manipulate or twist circumstances in a difficult transaction to force a closing so he can be compensated. Agents are expected to act honestly and professionally at all times according to the code of ethics of the National Association of Realtors.
  
  

Considerations

• Conditional fee agreements also have clauses that protect real estate agents from unethical behavior on the part of the sellers, buyers or other industry professionals. For example, if an agent finds a buyer a house, and the seller cancels the transaction in order to avoid paying of the agent's fees and resells the property to the same buyer, the conditional fee agreement allows the agent to pursue collection of his earned commission from the seller or buyer.