Is a licensee liable for a misrepresentation or concealment of a material fact made by a party if the seller did not disclose it to the agent?

A licensee can indeed be held liable for a misrepresentation or concealment of a material fact made by a party, even if that information was not disclosed to the agent by the seller. This is rooted in the principles of agency law, which establish that agents have a duty to their clients and third parties to act with honesty and integrity. When a licensee represents a seller, they have an obligation to ensure that any material facts are disclosed to prospective buyers.

If a seller conceals critical information about the property or provides misleading details, the licensee has a responsibility to conduct due diligence. This includes actively seeking out pertinent information and not taking statements at face value when there are red flags. Failure to address these concerns can lead to liability for the licensee, as the agent is expected to be aware of their fiduciary responsibilities, which extend to uncovering and truthfully presenting all material facts to avoid misleading any party involved in the transaction.

The nuances of each situation can vary, but the fundamental principle is that the licensee must not ignore or overlook information that could impact a buyer's decision, regardless of whether that information was directly shared by the seller or not. This duty to disclose and mitigate potential misinformation is central to maintaining trust and integrity in