Under what condition is it legal for a broker to represent both the seller and the buyer?

The correct answer is that a broker can legally represent both the seller and the buyer when both parties consent to dual representation. This situation, often referred to as dual agency, requires that the broker disclose their dual role to both clients and obtain informed consent from each party before proceeding.

This consent is crucial because it emphasizes transparency in the relationship and ensures that both the buyer and seller understand that the broker's ability to fully advocate for their individual interests might be limited due to the dual representation. Each party must be aware that the broker is acting on behalf of both sides, which can lead to potential conflicts of interest.

In contrast to this, scenarios such as when buyers are unrepresented or when only the seller is informed do not satisfy the legal requirements for dual representation, as they do not involve mutual consent from both parties. Additionally, the initiation of communication by the buyer does not inherently grant the broker the authority to represent both sides without prior consent.

Thus, obtaining consent from both parties is the fundamental legal requirement for a broker to act as a dual agent.