Agent Priya works as a buyer's agent at New Jersey Homes Realty. Her buyer client, Mr. Chen, makes an offer on a property listed by a cooperating brokerage. During negotiations, the listing agent, Frank, tells Priya that the seller has received another offer and asks Priya to confirm whether Mr. Chen can close within 30 days. Priya knows that Mr. Chen has already secured financing and can close in 21 days. Frank then asks if Mr. Chen would accept a higher purchase price in exchange for a faster closing. How should Priya respond under New Jersey agency law?
Correct Answer
B) Priya may confirm the ability to close in 21 days only with Mr. Chen's express permission, and must not volunteer information about Mr. Chen's maximum price tolerance
As Mr. Chen's buyer's agent, Priya owes him fiduciary duties including loyalty, confidentiality, and obedience. Confirming the ability to close quickly is factual information that may be shared with Mr. Chen's permission, as it could be used as a negotiating point in his favor. However, Priya must not volunteer information about Mr. Chen's price tolerance or willingness to pay more — that is confidential client information that could harm his negotiating position. Sharing such information would breach her fiduciary duty of confidentiality and loyalty.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A relationship where a listing broker authorizes other brokers to act as agents of the seller, extending the seller's agency relationship to cooperating brokers.
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.
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