New York Real Estate Salesperson ExaminationLaws of AgencyMedium
A real estate salesperson is showing a listing to a potential buyer. The buyer asks, 'Why is the seller moving?' What is the most appropriate response for the salesperson if they are acting as the seller's agent?
- AAsk the seller for permission to disclose the reason to the buyer.
- BTell the buyer the true reason, as it might help in negotiations.
- CState that the seller is moving due to a job relocation, regardless of the real reason.
- DDecline to answer, stating that such information is confidential.
Show answer & explanationAnswer & explanation
Correct answer: D. Decline to answer, stating that such information is confidential.
A seller's agent has a fiduciary duty of confidentiality to their client. The reason for selling is generally considered confidential personal information of the seller and should not be disclosed without explicit permission. Disclosing it could harm the seller's negotiating position.
Why the other options are wrong
- A. While asking for permission is an option, the most immediate and safest response when unsure is to invoke confidentiality.
- B. Disclosing confidential information without permission is a breach of the agent's fiduciary duty to the seller.
- C. Making up a reason is unethical and potentially misrepresentation.
Agent's Duty of Confidentiality
A fiduciary duty requiring an agent to keep confidential all information about their principal that could harm the principal's negotiating position or interests.
- Applies to all confidential client information.
- Continues even after the agency relationship ends.
- Only waived by client's explicit permission or legal requirement.
Memory trick: CONFIDENTIALITY is a locked vault for client secrets.