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Real Estate Contract Provision Regarding Agents

Real Estate Contract Provision Regarding Agents

Real Estate Contract Provision Regarding Agents

A recent 2016 First District Court of Appeal case has addressed a common provision in a Florida real estate contract that was designed to protect real estate agents. The contract language provides that the purchaser shall rely solely on the representations of sellers and third parties, other than the agents, for verification the property’s condition. Also in the contract was language that provided that the above protection will not relieve the agent of an agent’s statutory obligations. The court reasoned that claims based on violations of statutory obligations are not contradicted by the purchase agreement. Statutory obligations of the agent include a “duty of honesty and fair dealing, a duty to disclose all know facts that materially affect the value of the property and are not readily observable, and a duty not to make misleading, deceptive or fraudulent representations in any transaction. Thus, notwithstanding that the contract directs the buyer to rely on others – not the agent – with respect to the condition of the property, the agent continues, in the First District and possibly elsewhere if other courts follow this reasoning, to have statutory duties that cannot be avoided.

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