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In Texas, a broker's fiduciary duties to a client include all of the following EXCEPT:

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Question & Answer

Review the question and all answer choices

A

Loyalty

Loyalty is a core fiduciary duty requiring the agent to act in the client's best interest above all others, including the agent's own financial interests, and is firmly established under Texas agency law.

B

Obedience

Obedience is a recognized fiduciary duty that requires the agent to follow all lawful instructions given by the client, reflecting the principal-agent relationship's foundational requirement that the agent act as directed.

C

Guaranteeing profit

Correct Answer
D

Disclosure

Disclosure is a critical fiduciary duty obligating the agent to inform the client of all material facts relevant to the transaction, including information about the property, the parties, and any conflicts of interest, and is explicitly required under Texas law.

Why is this correct?

Guaranteeing profit is not a fiduciary duty because fiduciary obligations govern how an agent behaves β€” with loyalty, honesty, and skill β€” not what financial outcomes they must produce, since market results are inherently uncertain and outside any agent's control. The recognized fiduciary duties in Texas real estate agency are loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care (often remembered by the acronym OLDCAR), none of which include promising or guaranteeing a specific financial return. Imposing a duty to guarantee profit would be both legally unenforceable and commercially unreasonable, as it would require agents to warrant outcomes determined by market forces.

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