Broker Adams in Edmond, Oklahoma is representing buyer Patterson. During negotiations, Broker Adams learns from the listing agent that the seller is facing foreclosure and must close within 45 days to avoid losing the property. The listing agent shares this information in confidence. What should Broker Adams do with this information?
Correct Answer
B) Disclose the seller's foreclosure situation to buyer Patterson because it is material to the transaction
Broker Adams represents buyer Patterson and owes fiduciary duties to Patterson, including the duty of disclosure of all material facts. The seller's impending foreclosure and tight closing deadline are highly material to Patterson's negotiating position and decision-making. Under Oklahoma agency law, a buyer's agent must disclose all known material information to the buyer regardless of how that information was obtained, as the agent's duty runs to the client.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The fiduciary obligation to protect a client's private information and not disclose it to third parties without permission, surviving even after the agency relationship ends.
In real estate, a client is someone to whom the agent owes fiduciary duties through an agency relationship, while a customer is a third party to whom the agent owes only honesty and fair dealing.
An arrangement where a brokerage assigns separate agents within the firm to represent the buyer and seller in the same transaction, allowing each client to have dedicated representation.
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