Broker Hank in Nebraska lists a rural farmstead for seller Owen. A cooperating broker, Diane, brings a buyer and the property sells. After closing, Owen discovers that Diane had been working with the buyer under a subagency arrangement and had disclosed Owen's financial urgency to sell to the buyer during negotiations. Under Nebraska law, which of the following statements is most accurate regarding Diane's conduct?
Correct Answer
B) Diane violated her fiduciary duty because as a subagent of the listing broker, she owed loyalty to Owen as the seller
Under Nebraska agency law, when Diane operates as a subagent of the listing broker (Broker Hank), she is an agent of the seller, Owen — not an agent of the buyer. As Owen's subagent, Diane owes Owen the same fiduciary duties as the listing broker, including loyalty, confidentiality, and the duty to act in Owen's best interests. Disclosing Owen's financial urgency to sell to the buyer is a direct breach of Diane's fiduciary duty of confidentiality and loyalty to Owen. Subagency means Diane represents the seller through the listing broker, regardless of who she is physically working with in the transaction.
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Related Topics & Key Terms
Key Terms:
Related Concepts
An agency relationship where the agent agrees to act on behalf of the principal without receiving compensation.
An agency relationship created by the conduct or actions of the parties rather than by a written or oral agreement.
The legal obligation to reveal information that could affect a party's decision to enter into or the terms of a real estate transaction.
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