A seller of property tells their broker the house is connected to the sewer. The broker relays this information to a buyer, who later finds that the house has a septic system in need of repair. The buyer would sue:
Correct Answer
A) the broker and the seller.
A seller who states the property is on a public sewer when it is on a septic system is liable to the buyer for that misrepresentation, and the listing broker who repeats the statement to a buyer without reasonable grounds for believing it is liable for negligent misrepresentation. Passing information along does not transfer the risk of it being wrong; the broker who asserts a fact must have grounds to assert it. Both are therefore proper defendants, and the buyer is not barred by having failed to investigate a condition that was affirmatively misstated.
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Related Topics & Key Terms
Related Topics:
Key Terms:
Related Concepts
A relationship where a listing broker authorizes other brokers to act as agents of the seller, extending the seller's agency relationship to cooperating brokers.
A non-agency relationship where the broker facilitates a real estate transaction without representing either party, owing limited duties of honesty, fairness, and competence to both.
The legal principle that holds a broker responsible for the actions of their agents and employees performed within the scope of the agency relationship.
More Laws Of Agency Fiduciary Duties Questions
Under California law, the agency disclosure requirements apply to which types of property?
Under California law, when must a buyer's agent give the agency disclosure form to the buyer?
A broker who fails to promptly disclose their dual agency status is subject to:
A broker’s fiduciary obligation to protect a seller’s confidential information continues:
A broker has an exclusive agency listing on a property. If the owner sells the property, the broker is entitled to:
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