After a listing agreement is terminated, a third party asks a former seller's agent to disclose confidential information about the seller's financial habits that was learned during the agency relationship. Which of the following best describes the former agent's obligation?
Correct Answer
C) The duty of confidentiality survives termination of the agency, and the agent must decline to disclose the information
Confidentiality is one of the duties that outlives the agency. Authority to act for the principal ends when the agency terminates, but information the agent received in confidence - here the seller's financial habits - stays confidential, and the former agent declines to pass it on absent the former principal's authorization. Neither the close of escrow nor a third party's claim of potential harm supplies that authorization, and a licensee who discloses anyway risks discipline by the Department of Real Estate for breach of fiduciary duty as well as civil liability to the former client.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal requirement for real estate agents to inform all parties about who they represent in a transaction, typically provided at first substantive contact.
A legal relationship in which one person (the agent) is authorized to act on behalf of another person (the principal) in business transactions with third parties.
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
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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