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Under Ohio law, buyer's agent James represents client Emily. Emily tells James she plans to convert a single-family home into a rental property. James knows the property Emily wants to buy is in a neighborhood with restrictive covenants prohibiting rental use. What must James do?

Correct Answer

B) Disclose the restrictive covenants to Emily as a known material fact that directly affects her intended use

Under Ohio agency law, James's fiduciary duty requires disclosing known material facts to his client. Restrictive covenants prohibiting rental use directly conflict with Emily's stated plans and constitute a material fact she must know.

Answer Options
A
Say nothing because restrictive covenants are the buyer's responsibility to discover
B
Disclose the restrictive covenants to Emily as a known material fact that directly affects her intended use
C
Encourage Emily to convert the property anyway and deal with consequences later
D
Report the neighborhood association to the Division of Real Estate

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Related Topics & Key Terms

Key Terms:

buyer_agentrestrictive_covenantsmaterial_factintended_usefiduciary_dutyORC_4735
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