Why the codicil definition of mediator is narrow for the common real estate agent
Write atypical and read “unusual,” “unusual,” “different from the pattern of the norm.” Yet according to jurisprudence and doctrine, which created this figure, the atypical broker is precisely the common real estate agent, who operates according to the standard practice: assignment of the seller, use of his own business organization for marketing, identification of a buyer, purchase proposal etc.
Why is this professional so familiar to consumers “unusual,” “unfamiliar,” and “outside the pattern of the norm? Because the figure of the broker described in Civil Code Articles 1754 et seq. has little to do with the operating practice of the contemporary professional real estate agent.
The mediator in our grandparents’ time
According to the legislature of 1942 (i.e., 80 years ago…), a mediator is “one who brings two or more parties together for the conclusion of business without being bound to any of them by relations of collaboration, dependence or representation.” A completely free hitter, with no specific obligations to take action to achieve the result, capable of facilitating the conclusion of generic “deals” (not only real estate then) by connecting, that is, bringing together, people with converging interests.
But even declining that definition only in reference to the real estate sector, which is the one that has always most easily brought ordinary people into contact with the business of brokerage, it is clear that the codictic definition could not have been inspired by the activity from the agencies that swarm the streets of our cities. Simply because they did not exist at the time. That standard was written in a completely different world. A world without computers, without the Internet, without cell phones. A world in which information did not circulate as easily as we take it for granted today. A world in which people who wanted to buy homes could not scroll through the offers on their tablet, or consult prices on the local real estate stock exchange. In that world, information about who wanted to sell something and who wanted to buy it was rare, hard to find, territorially entrenched. Those looking for information had to go locally and seek it from the right people. It was enough to move to the next village and have to start the search from scratch. This kind of information was of enormous value in itself, because it enabled an otherwise very complicated matching of supply and demand. In itself it was an asset to be valued, and the resulting activity had to be legally protected because of its facilitating function in the exchange of goods.
The ombudsman could be the town surveyor, the mayor, the newsboy. There was no law regulating the practice of the profession. No examination, no Role in Chamber of Commerce (there is no more since 2010, but that’s another story…), no incompatibility. It was the “matchmaker” of old memory in short.
In terms of liability, the mediator only had to inform the parties of the circumstances known to him relating to the security and valuation of the bargain (Art. 1759 cc). If – in good faith – he knew nothing, no liability could be imputed to him. The circumstance of having allowed the parties to meet, in that world of such rarefied information, exhausted his function. Socially and legally, nothing more was required of him. (Nb: the dregs of this cultural approach can be found in even fairly recent Supreme Court rulings aimed at circumscribing the boundaries of real estate agents’ liability within boundaries now too narrow for consumer expectations. But this issue will be the subject of further discussion in another post…).
From the agricultural society to the era of disintermediation
Since then, the world has changed. We have entered the era of evolved services and communication. That of the mediator has become a real profession carried out through a more or less complex business organization. The age of the Internet, also called “disintermediation,” has deprived the mediator of the role of “priest of the news” (news is easily published and found on portals without the necessary intervention of the agent) and has given him more onerous tasks of guaranteeing the security of the deal. People–mostly–turn to the agency not so much because they are unable to post an ad online or search for the news on the Internet, but because they look to the broker for a professional manager of an increasingly complex and insidious sales process.
In short, water under the bridge has passed in 80 years, but the mediation regulations contained in the Civil Code have remained the same.
The real estate agent inextricably linked to the seller
Today’s real estate broker is a completely different figure from the village matchmaker who closed deals at the coffee table in the town square and who, after having the counterparts shake hands, disregarded what happened next. For several decades now, he has been operating – mostly – putting in place a real business organization, on the strength of a written assignment from the seller, chock-full of clauses that bind him firmly to the owner and derail the relationship from the legal scheme of mediation: exclusivity clauses, provision for penalties, mutual obligations etc. So much for the free hitter typified in the code. And it is precisely such meticulous contractual regulation of the seller-mediator relationship, according to case law and doctrine, that determines the eccentricity of the relationship with respect to the normative provision.
Such a broker contractually bound to the seller formally recovers a position of balance between the parties that justifies the double commission only if the buyer also acknowledges (in writing and by conclusive facts) his mediation activity. For this reason, in purchase proposals (or in side agreements) the buyer always signs a formal commission acknowledgement in favor of the real estate agent. In the absence of such an ex post acknowledgment, the mediator-in the eyes of the courts contractually “unbalanced”-could claim commission only from the seller, thus operating as a “one-sided” mediator. (The illogicality of the business practice of not charging the commission to the seller – the one who chose the mediator – and charging it back to the buyer – who did not choose it but finds it “attached” to the property – will not escape with respect to this legal scheme: not least because the commission, directly or indirectly, always falls on the seller).
The urgency of reform
Standard operating practice therefore is considered atypical because of the antiquity of the Civil Code. An antiquity that is evident from the combined provisions of Articles 1754 cc (definition of a mediator) and 1759 cc (liability of the mediator) and that underlies most disputes between clients and real estate agents.
When social and economic normality becomes atypical of the norm, it means that the law is outdated and needs to be changed. An inescapable sign of the urgency of a legislative reform that regulates the subject of intermediation starting from the social and technological reality of 2026 and leaving behind the agricultural company of 1942. That it therefore contemplates, in addition to classic brokerage, the new forms of biased advice typical of the most advanced service companies, imposing by law more stringent professional and ethical standards in line with consumer expectations.
