Wisconsin broker Tom is representing seller Carol. Buyer Victor, who is not represented by any agent, contacts Tom to view Carol's property. Tom provides Victor with a Disclosure to Customers form. Victor signs the form and proceeds to make an offer. Which statement best describes Tom's agency obligations in this situation?
Correct Answer
B) Tom represents only Carol, and Victor is a customer to whom Tom owes honesty, fairness, and disclosure of material adverse facts
Under Wisconsin Administrative Code REEB 24, signing the Disclosure to Customers form does not create an agency relationship between Tom and Victor. The form is a disclosure document informing Victor that Tom represents the seller. Tom continues to represent Carol as her seller's agent and owes Victor — as a customer — the duties of honesty, fairness, and disclosure of material adverse facts about the property, but not full fiduciary duties.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The legal principle that holds a broker responsible for the actions of their agents and employees performed within the scope of the agency relationship.
An agency relationship created when a principal's actions or words lead a third party to reasonably believe that an agent has authority, and the principal fails to correct this belief.
An agency relationship created when a principal approves or accepts an agent's previously unauthorized actions, effectively granting authority after the fact.
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