Humber/Ontario Real Estate Course 4 Exam Practice

What responsibility does ABC Realty Inc. have while working with a buyer in regard to the seller and listing brokerage?

1. Sub-agent duty to both the buyer and the seller.

2. Limited duty of care to the buyer only.

3. Fiduciary duties to the buyer and limited duty of care to the seller.

4. Exclusive fiduciary duty to the seller.

5. No fiduciary duties to any party involved.

6. Sub-agent duty to the listing brokerage only.

The correct answer is: Fiduciary duties to the buyer and limited duty of care to the seller.

ABC Realty Inc. has fiduciary duties to the buyer, which means they are obligated to act in the best interest of the buyer, providing loyalty, full disclosure, and confidentiality among other responsibilities. This set of duties is critical as it instills trust and assurance in the buyer that their needs and interests will be prioritized throughout the real estate transaction. In addition, while ABC Realty Inc. primarily focuses on the buyer, they also owe a limited duty of care to the seller. This means they must treat the seller fairly and professionally even though their primary allegiance is to the buyer. This is consistent with the principle that a real estate agent must maintain a standard of professional conduct, ensuring that all parties involved are treated with respect and transparency, even if their primary responsibilities lie with one party. The other options do not accurately reflect the dual nature of the responsibilities a real estate agent has in this context. For instance, claiming exclusive fiduciary duty to the seller would disregard the obligations owed to the buyer. Similarly, the notion of no fiduciary duties would fail to recognize the foundational ethical standards governing real estate practice. Ultimately, the choice highlighting the fiduciary duties to the buyer and the limited duty of care to the seller captures the essence of the agent's responsibilities in