What Are the Basic Torts and Responsibilities for Real Estate Agents?

What is a Tort?

A tort is when someone does something wrong that hurts another person or causes them to lose money. In real estate, torts usually happen when a real estate agent gives wrong information or doesn’t do their job carefully, which ends up causing problems for the buyer or seller.

Types of Misrepresentation (Giving Wrong Information)

1. Intentional Misrepresentation (Fraud)
This is when an agent purposely gives wrong information to trick someone. To prove this, it has to be shown that:

• The agent lied or didn’t tell the whole truth.
• They knew the information was wrong.
• They wanted to trick the person.
• The person believed this information and made decisions because of it.
• The person lost money or had problems because of this.

Example: An agent says a house has a new kitchen when it doesn’t, so the buyer believes it and pays more, only to find out they’ll have to fix it themselves.

2. Negligent Misrepresentation
This happens when an agent gives wrong information by accident because they didn’t check facts carefully. It means:

• The agent had a job to make sure information was correct.
• They didn’t double-check, so they gave wrong info.
• The person believed the information and relied on it.
• The person lost money or had problems because of it.

Example: An agent says a house isn’t in a flood zone without checking, and later, the buyer’s house gets flooded.

3. Innocent Misrepresentation
This is when an agent accidentally gives wrong information without meaning to and without being careless. It includes:

• The agent truly thought the information was right.
• The person believed the information.
• The person lost money or had problems because of it.

Example: An agent thinks the house is bigger than it actually is. The buyer buys it and then realizes it’s smaller than they thought.

Negligence (Not Being Careful)

Negligence is when an agent doesn’t do their job carefully enough, and it causes problems for the buyer or seller. To prove negligence, it must be shown that:

• The agent had a duty to be careful.
• The agent didn’t meet that duty by being sloppy or ignoring important details.
• The buyer or seller was hurt because of this.
• The buyer or seller lost money or had other problems.

Examples of Negligence:

• The agent doesn’t tell the buyer something important about the house, like a leak in the roof.
• The agent doesn’t know enough about the house and gives incorrect information.
• The agent ignores rules that protect the buyer.

Important Points for Real Estate Agents

• Real estate agents have to give the right information and be careful with what they say.
• If agents lie on purpose or don’t check information, they could get in trouble if the buyer or seller loses money.
• Intentional misrepresentation means the agent lied on purpose, negligent misrepresentation means they didn’t check properly, and innocent misrepresentation means they were wrong by accident.