Vermont buyers Lena and Marco are purchasing a property through Ridgeline Realty, a designated agency firm. Licensee Claire is their designated buyer's agent. During the transaction, Lena and Marco separate and Lena informs Claire that she no longer wants to purchase the property but does not want Marco to know. Marco still wants to proceed with the purchase. Which of the following best describes Claire's obligations under Vermont agency law?
Correct Answer
C) Claire faces an irreconcilable conflict and must withdraw from representing both Lena and Marco, disclosing to both that a conflict exists without revealing the specific nature of the conflict
Under Vermont agency law (26 V.S.A. Chapter 41 and VREC Rule 4.1), when a licensee's duties to one client directly conflict with duties to another client in a way that cannot be resolved, the licensee must withdraw from representing both parties. Claire cannot selectively represent Marco without breaching her duty to Lena, and she cannot keep Lena's material change in position confidential from Marco without breaching her duty to him. The ethical solution is withdrawal, with disclosure that a conflict exists — but without revealing Lena's confidential communications.
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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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