In Colorado, when acting as a transaction broker, which statement is true?

• A. The licensee owes fiduciary duties to the buyer only.
• B. The licensee owes fiduciary duties to the seller only.
• C. The licensee owes duties to all parties but not fiduciary duties to either party.
• D. The licensee owes no duties to any party.

Answer: (C)

In Colorado, a transaction broker represents both sides in a real estate deal in a limited, nonexclusive way rather than representing one party as a client. Because there isn’t a client–agent relationship with either party, the licensee does not owe fiduciary duties to the buyer or the seller. Instead, they owe duties to all parties to deal honestly and fairly, disclose known material facts, and avoid misrepresentation, while facilitating the transaction and keeping information balanced between both sides. They must treat both parties with impartiality and avoid conflicts of interest.

That’s why the statement describing duties to all parties but not fiduciary duties to either party is the accurate portrayal of a transaction broker’s role. The alternatives imply fiduciary duties to only one side or no duties at all, which doesn’t align with how transaction brokers operate in Colorado.