Seller’s Salesperson Has A Fiduciary Duty To Buyer In Real Estate Transaction.

A broker represented both the buyer and the seller in a real property transaction through two different salespersons. A building permit lists the total square footage of a residence as 11,050 square feet, but the real estate listing stated the home “offers approximately 15,000 square feet of living areas.” Buyers made an offer and asked for verification of the square footage. When architectural plans were not available, the buyers requested a six-day extension to inspect the property. The sellers refused to grant the extension and cancelled the transaction. The salesperson who listed the property for the broker argued he had no fiduciary duty to the buyer, and the trial court granted his motion for nonsuit on that cause of action. The jury found that the salesperson who listed the property made a false representation to the buyer, but that the salesperson “honestly believed and had reasonable grounds for believing the representation was true when he made it,” and returned a defense verdict. The appellate court reversed, and remanded the matter for new trial after holding the seller’s salesperson had a fiduciary duty equivalent to the duty owed by the broker, stating:  “When a broker is the dual agent of both the buyer and the seller in real property transaction, the salespersons acting under the broker have the same fiduciary duty to the buyer and the seller as the broker.”  (Horiike v. Coldwell Banker Residential Brokerage Company (Cal. App. Second Dist., Div. 5; April 9, 2014) 225 Cal.App.4th 427, [169 Cal.Rptr.3d 891].)