A listing agent in Hennepin County, Minnesota, is aware that her seller client has a history of sump pump failures that caused periodic basement flooding, but the seller instructs her not to include this information on the disclosure statement. The seller argues that the flooding was minor and has not occurred in over a year. Which of the following best describes the listing agent's professional and legal obligations in this situation?
Correct Answer
A) The agent should advise the seller to disclose the known flooding history and may need to withdraw from the listing if the seller refuses, to avoid liability for misrepresentation
Under Minn. Stat. Ch. 82, a listing agent owes duties of honesty and disclosure to all parties and may not assist a client in concealing known material defects. The agent should counsel the seller to disclose the flooding history, as periodic basement flooding from sump pump failures is a material defect. If the seller refuses, the agent risks liability for misrepresentation and should consider withdrawing from the listing rather than participating in the concealment of a known material defect.
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