Salesperson Dana represents seller Mr. Hoffman in the sale of his Springfield, Missouri home. During a showing, the prospective buyer Kevin asks Dana, 'Has this house ever had any foundation problems?' Dana knows from a previous conversation with Mr. Hoffman that the basement did flood twice, but Mr. Hoffman has asked her to keep that information confidential. How should Dana respond under Missouri agency disclosure law?
Correct Answer
D) Dana must disclose the known flooding history to Kevin because it is a material fact, even though she represents the seller.
Under Missouri law, even a seller's agent owes a duty of honest dealing to all parties, including unrepresented buyers. A licensee may not actively conceal or misrepresent material facts about a property. Known flooding history is a material fact that could affect Kevin's decision to purchase or the price he would pay. Missouri's agency law (RSMo § 339.730) and the Missouri Merchandising Practices Act (RSMo § 407.010) both prohibit concealment of material facts, overriding any confidentiality instruction from the seller regarding material defects.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The extent of power and actions an agent is authorized to perform on behalf of the principal, as defined by the agency agreement.
The fiduciary obligations owed by a listing agent to the seller, including marketing the property, presenting all offers, and protecting the seller's confidential information.
A practice where the agent or brokerage represents only one party in a transaction — either the buyer or the seller, but never both.
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