Can a property management rep. take money down then give to another?

By good renter

We were shown a property that we wanted to rent.  We wrote a check to the landlord for $300 but the property management owner who showed us the property would not take the check unit he showed the property to another couple who looked at the property right after we did.  After the couple left we presented the check to the property management owner and he took it.

three days later I contacted the property management owner about when we would sign the lease and he told me that he would get back to me later.  In the evening he called back and told me that another person had put money down on the property but she had not remained in contact with him.  If she contacted him in the next twenty four hours the rental will be hers and if not then the rental will be ours.  The next evening he contacted us and told us that the woman had contacted him and he gave her the rental.

We thought we were going to have that rental and we missed out on other suitable rentals because of the commitment we thought we had with the property management owner.

Is this legal? 

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Holy Cow, we couldn't find any other related post. Sorry. :(