Virginia's agency rules are statutory, not common-law. Article 3 of Chapter 21 (Code of Virginia §§54.1-2130 to 54.1-2146) defines every brokerage relationship, lists the duties a licensee owes, and — critically — abrogates (replaces) the common law of agency as to the matters it covers (§54.1-2144). On the exam, answer agency questions from the statute, not from generic national-course fiduciary lists. The single most-tested distinction is client vs. customer.
Core definitions (§54.1-2130)
- Client
- A person who has entered into a brokerage agreement with a licensee. Clients are owed the full statutory duties (loyalty, confidentiality, etc.).
- Customer
- A person who is NOT represented in a transaction but for whom a licensee performs ministerial acts. A customer is owed honesty and disclosure of known material adverse facts — not loyalty.
- Brokerage agreement
- The written agreement (e.g., listing or buyer-broker agreement) that creates the client relationship and authorizes the licensee to act.
- Ministerial acts
- Routine, informational acts that do NOT involve discretion or representation — e.g., showing property, providing forms, or relaying a message. Performing them does not create agency.
- Standard agent
- A licensee who acts for a client with the full set of statutory duties under §§54.1-2131 to 54.1-2135.
- Limited service agent
- A licensee who, by written agreement, provides only some of the standard-agent duties (e.g., a flat-fee MLS listing). The limits must be disclosed in the brokerage agreement (§54.1-2138.1).
- Independent contractor
- A licensee engaged under a written contract that specifies the services to be performed and states the relationship is non-agency / limited as agreed.
Statutory duties owed to a CLIENT (e.g., §54.1-2131 for sellers; parallel for buyers/landlords/tenants)
- Perform the terms of the brokerage agreement.
- Promote the client's interests with reasonable care — present offers promptly, help negotiate, answer questions, and disclose material facts the licensee knows.
- Maintain confidentiality of the client's information indefinitely (it survives termination).
- Account for money and property received.
- Exercise ordinary care and comply with all applicable laws and regulations.
- Disclose to the client material adverse facts about the property actually known by the licensee.
Duties owed to a CUSTOMER (the other side)
- Honesty
- A licensee must treat all parties honestly and must not knowingly give false information.
- Disclose known material adverse facts
- Even to a customer, the licensee must disclose material adverse facts about the physical condition of the property actually known by the licensee (§54.1-2131 et seq.).
- No loyalty/confidentiality owed
- A customer is NOT owed loyalty, full disclosure of advice, or confidentiality — those belong to the client only.
Creating, disclosing, and ending the relationship
- Brokerage agreement required (§54.1-2137)
- A standard or limited-service agency relationship must be set out in a written brokerage agreement that is in effect for a definite period of time; it also states broker compensation and policy on cooperating with/compensating other brokers.
- Buyer agreement before showing (§54.1-2132(A)(1), 2025)
- A licensee engaged by a buyer must enter into a written brokerage agreement with that buyer BEFORE showing property to them. A narrow exception (§54.1-2137(B)) lets the licensee prepare property-specific materials beforehand, but once showings begin, the signed agreement is required. This 2025 change (HB1684/SB1309) parallels the national buyer-representation reforms — expect it on current exams.
- Disclosure of brokerage relationship (§54.1-2138)
- In a residential transaction, a licensee must disclose to an actual or prospective party who is NOT the client which party the licensee represents — disclosed in writing at the earliest practical time, but no later than the time when specific real estate assistance is first provided (amended 2025, HB1684/SB1309). The disclosure names the licensee, the brokerage firm, and which party is represented, and must be made conspicuous (bold, all caps, underlining, or a separate box).
- Limited service agent disclosure (§54.1-2138.1)
- A limited service agent must give a specific written disclosure in (or attached to) the brokerage agreement, stating which standard duties are NOT being provided.
- Ownership-interest disclosure (§54.1-2138.2)
- A licensee selling property in which they have an ownership interest must disclose that interest.
- Termination duties
- Confidentiality survives termination forever; otherwise duties end when the brokerage agreement ends or the transaction closes.
Dual and designated agency (require WRITTEN consent)
- Dual agent (§54.1-2139)
- One licensee (or firm) represents both client parties in the same residential transaction. Lawful only with the prior WRITTEN consent of BOTH clients; the dual agent may not represent one client's interests to the detriment of the other.
- Designated agent (§54.1-2139.1)
- The principal/supervising broker assigns DIFFERENT licensees in the same firm to separately represent each client. Also requires written disclosure/consent; the broker becomes a dual representative at the firm level.
- Commercial dual agency (§54.1-2139.01)
- Parallel rule authorizing disclosed dual agency in commercial transactions.
Things that do NOT, by themselves, create agency
- Compensation alone — paying or receiving a fee does not create a brokerage relationship (§54.1-2140); a cooperating/selling agent paid from the listing side can still represent the buyer.
- Using a common source information company such as an MLS (§54.1-2141).
- Performing ministerial acts for an unrepresented customer.
Liability and the common law
- No imputed knowledge (§54.1-2142)
- A client is not liable for a licensee's wrongful act unless the client knew or should have known; knowledge of the licensee is not automatically imputed to the client, and vice versa.
- Liability for false information (§54.1-2142.1)
- A licensee is generally not liable for providing false information if it was supplied by the client/another party and the licensee did not know it was false.
- Common law abrogated (§54.1-2144)
- Article 3 replaces the common law of agency for the duties it covers — so Virginia answers come from the statute, not generic fiduciary doctrine.
Exam traps: (1) Client = has a brokerage agreement and is owed full duties; customer = unrepresented, owed only honesty + disclosure of known material adverse facts. (2) Both dual AND designated agency require WRITTEN consent. (3) Compensation alone never creates agency — the question of 'who pays' is separate from 'who represents.' (4) Confidentiality lasts forever, even after the relationship ends.