A listing agent discovers that the property they are marketing has a serious foundation issue that the seller has not disclosed. What is the agent's ethical obligation?
Correct Answer
A) Advise the seller to disclose it and withdraw if they won't
Agents cannot participate in misrepresentation or concealment of material facts. They must advise clients to make proper disclosures and may need to withdraw from representation if the client refuses to comply with disclosure obligations.
Why This Is the Correct Answer
Option A correctly reflects the agent's ethical obligation under Canadian real estate regulations. Agents cannot participate in misrepresentation or concealment of material facts, as this violates their professional duties under TRESA, RESA, and provincial codes of ethics. The agent must advise the seller to disclose the foundation issue, and if the seller refuses, the agent must withdraw from representation to avoid becoming complicit in potential fraud or misrepresentation. This protects both the agent's license and maintains market integrity.
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A listing agent learns that the basement floods in heavy rain, a hidden defect that the seller is legally obliged to disclose to buyers. The seller has not disclosed it and asks the agent to keep quiet. What is the agent's obligation under Ontario law?
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A listing agent learns that the basement had water damage years ago that was fully repaired. The seller has no legal obligation to disclose it and refuses to mention it in the listing. What is the agent's best course of action?