Florida Real Estate Sales Associate Examination Content OutlineReal Estate Contracts and AgencyMedium
A real estate broker is acting as a single agent for a seller who is eager to sell their property quickly due to a job relocation. The broker receives a low offer from a potential buyer. To expedite the sale, the broker advises the seller to accept the offer, even though the broker believes a higher offer could be obtained if they waited a few more weeks. Which fiduciary duty has the broker most likely breached?
- ADuty of confidentiality
- BDuty of loyalty
- CDuty of accounting
- DDuty of obedience
Show answer & explanationAnswer & explanation
Correct answer: B. Duty of loyalty
The duty of loyalty requires a single agent to act solely in the best interests of their principal. By advising the seller to accept a low offer to expedite the sale, rather than striving for the best possible price, the broker is prioritizing their own interest (a quick commission) or convenience over the seller's best financial interest, thus breaching loyalty.
Why the other options are wrong
- A. Confidentiality relates to protecting private information; no information was improperly disclosed here.
- C. Accounting relates to handling funds and property; there's no indication of mishandling money.
- D. Obedience relates to following lawful instructions; the seller didn't instruct the broker to take a low offer.
Agent's Duty of Loyalty
A fundamental fiduciary duty requiring a real estate agent to act solely in the best interests of their principal, placing the principal's financial and personal objectives above the agent's own interests or the interests of any other party.
- Paramount duty in single agency relationships.
- Requires prioritizing the principal's goals (e.g., highest price for seller, lowest price for buyer).
- Prohibits self-dealing or acting for personal gain at the principal's expense.
- Forms the basis for trust in the agency relationship.
Memory trick: OLD CAR protects the client's interests.