Maryland licensee Angela represents buyer Carl. During the transaction, Angela discovers that the home Carl wants to purchase has a material defect — a cracked foundation — that the seller has not disclosed. The seller's agent asks Angela not to mention it so the deal does not fall apart. What must Angela do under her fiduciary and legal duties in Maryland?
Correct Answer
B) Disclose the cracked foundation to Carl immediately, as her fiduciary duty to her buyer client requires disclosure of material facts
Angela owes Carl a fiduciary duty of disclosure, which requires her to inform him of all material facts that could affect his decision to purchase. A cracked foundation is clearly a material defect. Angela's duty to her buyer client overrides the seller's agent's request for silence. Concealing a known material defect would also violate Maryland's Residential Property Disclosure Act and expose Angela to disciplinary action by MREC.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
The fiduciary obligation to protect a client's private information and not disclose it to third parties without permission, surviving even after the agency relationship ends.
In real estate, a client is someone to whom the agent owes fiduciary duties through an agency relationship, while a customer is a third party to whom the agent owes only honesty and fair dealing.
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