1. A listing broker representing a seller does not inform an interested buyer of his existing agency relationship or provide any agency disclosure form. Together, the broker and buyer looked at many properties, some listed by the broker and other entered into the MLS by other firms, and the broker began to advise the buyer. Based on this advice; the buyer purchased one of the properties listed by another firm. There turned out to be many undisclosed defects, which would have been revealed with good due diligence. Under the common law of agency, has the broker committed any improper act?
   1. Yes; honestly and disclosure of material facts known to the broker are duties to any party in a transaction, and as a participant in the MLS the broker should have known about the defects in the property he was recommending
   2. Yes; because there was no agency disclosure and the broker advised the buyer, an implied agency relationship may have developed, and the broker should have advised the buyer to use outside service to ensure that the property was in good condition
   3. No; the property purchased by the buyer was not the brokers listing. Therefore, the broker could not have known or be expected to know of latent defects, nor did he have any obligation to recommend due diligence to buyer he was not representing
   4. No; since the broker did not enter into a written buyers agency contract with the buyer the should not have any expectation that the brokers advise was in the buyers best interest

Scenario AG

You are a broker with a large company. The companys relocation department has given you a referral for someone who is selling a home in another state and moving to your area. Your first contract with him is by phone. You discuss agency and fax documents for him to sign. The prospective buyer indicates he has $500,000 to purchase a property, and he would like to have enough land to raise horses.

You locate a 25-acre site with a 3-bedroom brick house. The prospective buyer likes the property. He has a few concerns, but would like to move forward with an offer.

2. Inspection of a dump site on the property indicates the clean-up will cost approximately $30,000, which you believe to be somewhat high priced. The prospective buyer accepts the cost and wants to close. Which one of the following is most appropriate?
   1. Tell him the estimate of cost for the dump site is unrealistic
   2. Support the buyers choice for purchase without question
   3. Be sure the offer includes acknowledgement of all disclosures
   4. Document thats you advised against making an offer
   5. Recommend a second estimate from another vendor
   6. Recommend that the seller pay for the cleanup
3. What possible consequence would the knowledge of a Megans Law registrant in neighborhood cause?
   1. This should have no effect on the values as that would be deemed to be discrimination of protected class
   2. Commercial properties may decline in value due to the presence of contamination in the soil and ground water
   3. Real property values will increase due to the additional police patrols this may generate in the neighborhood
   4. Values in a single family, owner occupied neighborhood may decline due presences o convicted sex offender
4. In jurisdiction where the common law of agency governs real estate activities, a buyer is signing open buyer agency agreements with many brokers. He has been viewing multiple properties with multiple brokers. The buyer will be liable for
   1. One commission to the broker who locates the property that he purchases
   2. Multiple commissions to every broker that showed him property
   3. One commissions to every broker through whom he places his first offer
   4. Multiple commissions to every broker with whom he signed an agreement