A buyer asks an agent about potential issues with the property's drainage. The agent knows there have been problems but says nothing. This represents:
Correct Answer
A) A breach of the agent's duty to deal honestly with buyers as well as the vendor
While agents primarily represent vendors, they have a duty under consumer protection laws to act honestly and fairly toward all parties. Deliberately concealing known material defects constitutes misleading conduct and can result in professional sanctions and legal liability.
Why This Is the Correct Answer
Staying silent when directly asked about a defect the agent knows of creates a false impression that there is nothing to disclose. That is misleading conduct by omission and breaches the agent's duty to deal honestly with buyers, even though the agent acts for the vendor.
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