Michigan salesperson Greg represents buyer couple the Nguyens in purchasing a home in Dearborn. During the transaction, the listing agent, who is also a Michigan licensee, tells Greg that the seller has received another offer and asks Greg to reveal the Nguyens' highest possible price. Greg knows the Nguyens could go up to $310,000 but have offered $295,000. What should Greg do, and what is the legal basis under Michigan law?
Correct Answer
A) Decline to disclose the Nguyens' maximum price, as it is confidential information protected under the fiduciary duty of confidentiality (MCL 339.2512d)
Greg's fiduciary duty of confidentiality under MCL 339.2512d requires him to protect the Nguyens' maximum willingness to pay from all third parties, including the listing agent. The Nguyens' financial ceiling is among the most sensitive negotiating information a buyer's agent holds. Disclosing it without explicit client authorization would be a serious breach of fiduciary duty regardless of the other agent's request or the competitive situation.
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Related Topics & Key Terms
Key Terms:
Related Concepts
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.
The legal obligation to reveal information that could affect a party's decision to enter into or the terms of a real estate transaction.
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