New York Real Estate Salesperson ExaminationLaws of AgencyEasy
A buyer's agent receives a confidential email from their client detailing their financial struggles and urgent need to close on a property quickly. The agent later casually mentions this information to the seller's agent during a lunch meeting. Which fiduciary duty has the buyer's agent violated?
- ADuty of obedience
- BDuty of loyalty
- CDuty of accounting
- DDuty of confidentiality
Show answer & explanationAnswer & explanation
Correct answer: D. Duty of confidentiality
The agent's casual mention of the client's financial struggles and urgent need to close constitutes a direct breach of the duty of confidentiality. This information is private and could be used to the client's disadvantage in negotiations.
Why the other options are wrong
- A. Duty of obedience involves following instructions, which isn't the primary issue here.
- B. While this also harms the client's interests (touching on loyalty), the most direct breach is the unauthorized disclosure of private information.
- C. Duty of accounting relates to funds, not private information.
Duty of Confidentiality
A fiduciary duty requiring an agent to keep all personal and financial information of their client private, even after the termination of the agency relationship.
- Protects client's private details.
- Includes motivations, financial status, negotiation limits.
- Lasts indefinitely after agency ends.
Memory trick: OLD CAR: Obedience, Loyalty, Disclosure, Confidentiality, Accounting, Reasonable Care.