Salesperson Pua is a seller's agent for a Honolulu condominium listed under HRS Chapter 514B. A prospective buyer, David, asks Pua directly: 'Is there any pending special assessment for the building?' Pua knows the condo association recently voted to levy a $15,000 special assessment for roof repairs, but the seller has not mentioned it. What must Pua do?
Correct Answer
D) Pua must disclose the pending special assessment to David because it is a material fact that a buyer would consider important.
Even as a seller's agent, Pua has a duty to disclose known material facts to all parties, including the buyer. A $15,000 pending special assessment is unquestionably a material fact that a reasonable buyer would consider important in deciding whether and at what price to purchase the property. Under HRS Chapter 467 and Hawaii Administrative Rules Title 16, Chapter 99, a seller's agent may not actively misrepresent or conceal material facts from buyers, even while primarily representing the seller's interests.
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Related Topics & Key Terms
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.
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