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Law School Case Brief

Haymes v. Rogers - 70 Ariz. 257, 219 P.2d 339 (1950)

Rule:

A real estate agent owes the duty of utmost good faith and loyalty to the agent's principal.

Facts:

A real estate agent brought an action against a landowner seeking to recover a real estate commission in the sum of $425. The landowner had listed a property for sale with the agent in the sum of $9,500. The listing card which the landowner signed provided that the commission to be paid to the agent for selling the property was five (5%) per cent of the total selling price. The case was tried before a jury, which awarded the agent a commission for the sale of the landowner's property. On appeal, the landowner claimed that the trial court erred by refusing to grant a motion for an instructed verdict in favor of the landowner based upon evidence that the real estate agent knew that the landowner could get more for his property than he was actually paid.

Issue:

Was the real estate agent entitled to commission?

Answer:

No

Conclusion:

The court reversed the judgment in favor of the agent and held that the agent owed a fiduciary duty to the landowner to disclose to the landowner that he could receive more for his land than was offered and accepted, and consequently, the agent was not entitled to receive a commission from the landowner for the sale of the property because the agent had breached his duty of loyalty to the landowner.

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