Agent Derek has been representing buyer Amy under a signed buyer representation agreement. Amy finds a property she loves that is listed by Derek's own brokerage. Amy signs the MREC-mandated intra-company agency consent form. Two weeks later, Amy tells Derek she is having second thoughts about the purchase and wants Derek to help her find reasons to back out of the contract. What should Derek do?
Correct Answer
C) Explain to Amy that under intra-company agency, he cannot advocate aggressively on her behalf against the seller's interests, and advise her to consult an attorney
Under Maryland intra-company agency, Derek's ability to aggressively advocate for Amy against the seller's interests is limited. He cannot use his position to help Amy find pretextual reasons to exit a contract in a way that is adverse to the seller. The appropriate response is to explain these limitations to Amy and advise her to consult a licensed attorney for legal advice on her contract rights. Derek can inform Amy of objective contract terms and contingency deadlines, but cannot serve as her adversarial advocate against the seller.
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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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