Buyer's agent Lisa in Missouri has been working with her client, buyer Paul, for several weeks. Paul confides to Lisa that he is going through a divorce and must purchase a home quickly, and that he is willing to pay up to $310,000 even if he can offer less. The seller's agent later asks Lisa, 'Is your buyer motivated? What's his top dollar?' What must Lisa do under Missouri agency disclosure law?
Correct Answer
C) Lisa must protect Paul's confidential information and may decline to reveal his motivation or maximum price to the seller's agent.
Under Missouri agency law (RSMo § 339.730), a buyer's agent owes fiduciary duties to the buyer-client, which include the duty of confidentiality. Paul's divorce situation and his maximum willingness to pay are classic examples of confidential client information that, if disclosed, could harm Paul's negotiating position. Lisa is legally and ethically required to protect this information from the seller and the seller's agent. This is one of the core distinctions between a client (who receives full fiduciary duties including confidentiality) and a customer (who receives only honest dealing).
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal requirement for real estate agents to inform all parties about who they represent in a transaction, typically provided at first substantive contact.
A legal relationship in which one person (the agent) is authorized to act on behalf of another person (the principal) in business transactions with third parties.
The legal ending of an agency relationship, which can occur through completion, expiration, mutual agreement, breach, death, incapacity, or bankruptcy of either party.
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