Agency Relationships and Disclosures Practice Question

Question

A buyer and seller disagree about a transaction term involving fiduciary duty of confidentiality. Which statement best describes fiduciary duty of confidentiality? (Item 103)

Answer choices

1. A. It allows a salesperson to act independently of the responsible broker.
2. B. It shifts all responsibility to escrow and eliminates the broker’s duties.
3. C. Protect confidential client information unless disclosure is authorized or legally required.
4. D. It makes oral promises enforceable in every real estate transaction.

Correct Answer

C. Protect confidential client information unless disclosure is authorized or legally required.

Explanation

The correct answer is C because fiduciary duty of confidentiality requires candidates to protect confidential client information unless disclosure is authorized or legally required. The other options overstate the effect of custom, oral agreement, escrow, or independent salesperson action and do not reflect safe California exam practice.

Question details

• Difficulty: easy
• Domain: Agency Relationships and Disclosures
• Objective: fiduciary duty of confidentiality

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