What characterizes multiple representation without designated agency?

In a scenario of multiple representation without designated agency, both the seller and the buyer are represented by the same brokerage in a real estate transaction. This arrangement means that the brokerage has a duty to act in the best interests of both parties involved. However, it does not assign specific agents to each party to represent their individual interests separately.

This setup is significant because it allows the brokerage to facilitate the transaction while maintaining a neutral position, ensuring that both parties are aware that the same company represents them. The challenges and ethical considerations in this situation arise from the need to handle potential conflicts of interest, as the brokerage must navigate the interests of both clients carefully.

The other options suggest scenarios where either only one party is represented or neither party is a client of the brokerage, which does not accurately describe the nature of multiple representation without designated agency, where both parties are clients within the same transaction.