This section is from the book "Real Estate Principles And Practices", by Philip A. Benson, Nelson L. North. Also available from Amazon: Real Estate Principles and Practices.
The broker is usually the agent or representative of his principal. As such he owes it to his principal to give faithful, honest service. He should not allow personal considerations to interfere with his duty. "No man can serve two masters" is an age-old truth and applies to the real estate broker's relations with the principals to a transaction. A number of legal decisions hold that a broker, clothed with the slightest discretion, cannot secretly accept compensation from both parties.5 The interests of purchaser and seller are adverse, and it is inconsistent with the proper performance of his duty to one employer that he act for and accept reward from another. It is a breach of his implied contract with each. His acting for both without disclosing the fact constitutes a fraud and precludes the recovery of commission.6 It was held in one case that it was the character of the employment that determined the matter, and that where the broker was employed merely to bring the parties together, the terms being arranged between the parties when they met, it was not improper for him to accept a commission from both even though he failed to notify them of it.7. Of course in any case, the broker can accept a double commission with the knowledge and consent of the parties.
 
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