Agent Victor in Idaho represents buyer couple Mike and Susan under a written buyer representation agreement. Mike and Susan are interested in a property listed by a different brokerage entirely. During negotiations, the listing agent tells Victor that the seller will not accept any offer below $485,000 — the seller's true bottom line. Victor does not disclose this to Mike and Susan, believing it to be confidential seller information. Mike and Susan submit an offer at $470,000 and the deal falls through. Which statement most accurately describes Victor's conduct under Idaho agency law?
Correct Answer
B) Victor violated his fiduciary duty to Mike and Susan by failing to disclose material information that could have directly affected their offer strategy
As Mike and Susan's buyer's agent, Victor owes them a fiduciary duty of full disclosure of all material information — including information he learns during negotiations that could affect their decision-making. The seller's true minimum acceptable price ($485,000) is highly material information: had Mike and Susan known it, they could have submitted an offer at or above that threshold and likely closed the deal. The fact that the listing agent shared this information does not make it confidential as against Victor's own clients. Victor's duty of loyalty and full disclosure runs to Mike and Susan, not to the seller or listing agent.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The extent of power and actions an agent is authorized to perform on behalf of the principal, as defined by the agency agreement.
The fiduciary obligations owed by a listing agent to the seller, including marketing the property, presenting all offers, and protecting the seller's confidential information.
A practice where the agent or brokerage represents only one party in a transaction — either the buyer or the seller, but never both.
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