Agent Taylor in Kentucky is a seller's agent for a home owned by the Petersons. During a showing, potential buyer Collins — who is unrepresented — tells Agent Taylor that he is going through a divorce and needs to close quickly regardless of price. Agent Taylor does not represent Collins. What is Agent Taylor's correct course of action regarding this information under Kentucky agency law?
Correct Answer
D) Disclose Collins's urgency and divorce situation to the Petersons because Agent Taylor owes them fiduciary duties
Under Kentucky agency law (KRS Chapter 324 and 201 KAR 11:121), Agent Taylor is a seller's agent and owes fiduciary duties exclusively to the Petersons. Collins is an unrepresented customer, not Agent Taylor's client. Collins's urgent need to close quickly and his divorce situation are material facts that directly affect the Petersons' negotiating position. As the Petersons' fiduciary, Agent Taylor has an affirmative duty to disclose this information to her clients. The duty of loyalty to the sellers requires sharing information that benefits the sellers' negotiating interests.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
An agency relationship created by the conduct or actions of the parties rather than by a written or oral agreement.
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