Broker Michael in Indiana is representing seller Patricia under a listing agreement. During a showing, a prospective buyer named Greg tells Michael that he is going through a divorce and must buy a home within 30 days or lose a favorable financing arrangement. Greg is not Michael's client. Under Indiana law, what must Michael do with this information?
Correct Answer
D) Disclose Greg's time pressure and motivation to Patricia because Michael owes fiduciary duties to the seller
Under IC 25-34.1-10, Michael is Patricia's seller's agent and owes her full fiduciary duties, including the duty of disclosure. Greg's urgent timeline and motivation to purchase quickly are material facts that could affect Patricia's negotiating position. Michael is legally required to disclose this information to his client Patricia, even though Greg did not intend for it to be shared.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An agency relationship created by a clear, explicit agreement between the principal and agent, either orally or in writing.
The highest legal obligation of trust and confidence owed by an agent to their principal, requiring the agent to act solely in the principal's best interest.
An agency relationship where the agent agrees to act on behalf of the principal without receiving compensation.
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