Marcus, a licensed Kentucky sales associate, is representing a buyer purchasing a home. During a walkthrough, Marcus personally observes a large crack in the foundation that the seller has not disclosed on the Seller Disclosure form. The seller instructs Marcus not to mention it to the buyer. What is Marcus's correct course of action under Kentucky law?
Correct Answer
A) Marcus must disclose the foundation crack to his buyer client because licensees have an independent duty to disclose known material defects regardless of seller instructions.
Under KRS 324.360 and KREC regulations, Kentucky licensees have an independent duty to disclose known material defects to their clients. A foundation crack is a material defect that directly affects the value and habitability of the property. Marcus cannot suppress this information simply because the seller instructs him to do so. His fiduciary duty to his buyer client and his statutory obligation under Kentucky law require disclosure.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A seller's disclosure statement is a form that sellers complete to inform buyers about the condition and history of the property, including known defects, past repairs, insurance claims, and environmental issues.
Many states and localities have fair housing laws that expand upon the protections offered by the federal Fair Housing Act.
A stigmatized property is one that has an undesirable reputation due to events that occurred on the property or nearby, such as a murder, suicide, alleged haunting, or proximity to a registered sex offender. The stigma is psychological, not physical.
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