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When does a customer become a client?

March 9, 2012
By MARIO D'ARTAGNAN - Real Estate in Perspective , Cape Coral Daily Breeze

It has been several months since I first wrote about the distinction between customer and client, and it is worthy of some expansion. I just finished reading 40 or 50 blogs discussing the difference between what a customer is, and what a client is. Frankly, they are all wrong. It has nothing to do with mindset, nor does it have to do with how long you have had a business relationship with someone.

We will keep this discussion limited to real estate practitioners. If you as a licensed broker or salesperson, do not have a written contract with a party wherein you create a relationship that contains fiduciary duties (trust and confidence), then that party is nothing more than a customer - period. The only relationship where a licensee could create a fiduciary relationship is by entering into a written, single agency agreement with a consumer. That consumer would then be considered a client. Somehow, these definitions and distinctions have become convoluted as more and more people entered the real estate industry. It is the lack of these distinctions that attorneys love. If you want to end up defending your words in court, continue to refer to that customer as a client. And if you think I'm mistaken, you could check out the case law files on this issue.

When you continue to address someone as a client, you have ostensibly created a fiduciary relationship, albeit it is not in writing. By mere utterance of the word, you have created the relationship between client (fiduciary) and agent, notwithstanding your intent. In other words, that "customer" has just become a "client" and would have an expectation of client/agent duties. That party would have a reasonable expectation that whatever he or she told you would be held in confidence.

What is really interesting is that I have perused continuing education workbooks, and pre-licensure text books, and nowhere was I able to find the word "client," attached to any relationship, except when a single agency is created by written contract.

I hope this clears up the issue once and for all. It is very simple. If you do not have a written agreement with a buyer or seller as a single agent, then that party is a customer only.

Mario D'Artagnan is a freelance writer. He is a former investigator for the Florida Real Estate Commission. He is also a former real estate instructor. He is a published author and has been a keynote speaker on the subject of agency law. He is also a veteran of the U.S. Air Force. For questions or comments contact Mr. D'Artagnan at: or call 239-565-4445.



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