Agent David is working with a buyer in Minnesota. At the initial meeting, David provides the required agency disclosure form. The buyer reads it and says, 'I don't want you to represent me — I just want your help finding a house without any agency relationship.' David agrees and proceeds on that basis. Later, David begins consistently advising the buyer to make higher offers and negotiating aggressively on the buyer's behalf. Under Minnesota law, what is the most likely consequence of David's conduct?
Correct Answer
B) David may have inadvertently created an implied agency relationship with the buyer despite the initial non-agency disclosure
Under Minnesota law (Minn. Stat. Ch. 82), agency relationships can be created by implication through conduct, even when an initial non-agency disclosure was provided. When David began consistently advising the buyer to make higher offers and negotiating aggressively on the buyer's behalf, his conduct was inconsistent with the facilitator role and may have created an implied buyer's agency relationship. This exposes David to potential liability for acting as an agent without proper disclosure of the changed relationship.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A non-agency relationship where the broker facilitates a real estate transaction without representing either party, owing limited duties of honesty, fairness, and competence to both.
The legal principle that holds a broker responsible for the actions of their agents and employees performed within the scope of the agency relationship.
An agency relationship created when a principal's actions or words lead a third party to reasonably believe that an agent has authority, and the principal fails to correct this belief.
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