A listing agent in Troy, Michigan receives three offers on the same property on the same day. The seller asks the listing agent to reveal the terms of each competing offer to the other buyers so they can submit their best and final offers. Under the Michigan Occupational Code and agency principles, which response best describes the listing agent's obligations?
Correct Answer
D) The listing agent may not disclose specific offer terms of competing buyers without their consent, even at the seller's direction
Under Michigan agency law and the Michigan Occupational Code (MCL 339.2512), a listing agent owes fiduciary duties to the seller but also has obligations to treat all parties honestly and fairly. While the listing agent follows the seller's lawful instructions, disclosing the specific terms of a competing buyer's offer without that buyer's consent would be a breach of the duty of confidentiality owed to those buyers as third parties. The listing agent can inform buyers that competing offers exist and invite best-and-final offers without revealing specific competing terms.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Liquidated damages are a predetermined amount of money specified in the contract that the non-breaching party is entitled to receive if the other party breaches. In real estate, the earnest money deposit typically serves as liquidated damages.
Novation is the substitution of a new contract for an existing one, or the replacement of one party with a new party, with the consent of all parties involved. The original party is completely released from all obligations.
Offer and acceptance is the process by which one party proposes specific terms for a contract and the other party agrees to those exact terms, creating mutual assent. This mutual agreement, also called a meeting of the minds, is an essential element of every valid contract.
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