In the last 2 posts we said that a REALTOR® has a fiduciary duty to his/her client for 6 specific standards, and that we remember them by using the acronym OLD CAR (Obedience, Loyalty, Disclosure, Confidentiality, Accountability and Reasonable Care/Diligence). Today we’ll cover disclosure and confidentiality.
DISCLOSURE: A REALTOR® must keep his/her client informed about all facts, positive or negative, that could affect the transaction. This includes both all of the information that he/she already knows, plus any information that he/she receives. The reason for this duty is obvious: the client, whether a buyer or a seller, may want to proceed differently once aware of new information. The duty of disclosure includes information that the REALTOR® was given by any source, including agents representing the other side of the transaction.
CONFIDENTIALITY: We mentioned confidential information when we spoke about the duty of loyalty. A REALTOR® must protect all of his/her client’s lawful secrets and confidences. Notice that we’ve said “lawful” secrets and confidences; any material defects don’t fall into this category, and must be disclosed to buyers when the REALTOR® is representing the seller. Again, the reason for the duty of confidentiality is obvious: some of that information might harm the client’s bargaining position when a purchase price is being negotiated. The seller’s agent has to try get the highest possible price, while the buyer’s agent has to try to get the lowest possible price.
Next time we’ll talk about the last two fiduciary duties of a REALTOR®, Accounting and Reasonable Care and Diligence.
Note: I wrote this article; these are my personal views and do not necessarily reflect the views of Diane Turton, Realtors.