Can I Sue a Realtor for Not Disclosing a Buyer’s Identity?

 Posted on September 17,2024 in Real Estate

A homeowner who recently sold a Miami mansion for $79 million is suing the realtor for failing to disclose that the buyer was billionaire Jeff Bezos. The owner had originally listed the price at $85 million and said he would not have slashed $6 million off the asking price had he known that the Amazon founder was writing the check.

It is common for billionaires, politicians, and celebrities to use trusts and other legal tools to maintain privacy when purchasing real estate. But is it legal to hide this information from the seller? Can a property owner in Texas take legal action if the identity of the buyer is not disclosed?

This article will explore the answers to those questions, as well as how to contact a Texas real estate attorney for more details.

What Are the Responsibilities of a Realtor?

To understand whether a realtor must disclose the identity of the buyer, it is important to first understand the responsibilities of a real estate agent. They are regulated by the Texas Real Estate License Act and enforced by the Texas Real Estate Commission.

These responsibilities include:

• Fiduciary duty: A realtor is required to act in the best interests of his or her client. He or she must also treat all other parties fairly in a real estate transaction.
• Fraud or misrepresentation: A realtor is not allowed to misrepresent facts. This includes withholding important information from the parties or exaggerating certain details to increase the value of the property.
• Contractual obligations: A realtor is required to abide strictly by all terms of his or her contract with the client.

Is a Realtor Required to Disclose the Identity of a Buyer?

There is no rule that a real estate agent must reveal the identity of a property buyer in a transaction. However, if withholding that information would affect the seller’s decision, it can be seen as misrepresentation. If the buyer, for example, has a conflict of interest or is a known competitor of the seller, disclosure of the buyer’s identity might change the seller’s decision to sell. In that case, concealing such information could be seen as a misrepresentation of facts.

The same is true if the buyer’s identity would affect the asking price, as in the case of Jeff Bezos. That is why the homeowner’s attorneys are suing the realtor on the grounds that she misrepresented the facts.

If the realtor withholds such information from his or her client it can also be seen as a breach of fiduciary duty.

Is a Property Buyer Entitled to Privacy?

On the other hand, it is legal for buyers to purchase property through LLCs or trusts to hide their identities. One of the reasons some buyers do this is exactly because they fear the asking price will increase if their identities become known.

If non-disclosure of the buyer’s identity is written into the realtor’s contract with the buyer, then the agent is likely prohibited from revealing it.

Contact a San Antonio, TX Real Estate Lawyer

If you are selling real estate, it can be challenging to make sure you are being treated fairly by other parties in the transaction. When you work with Geoff Mayfield, Attorney at Law, you can rest assured that your interests are under excellent legal protection. Schedule a free consultation with a Comal County, TX real estate attorney by calling 210-535-0870 today.