What Duties Does a Listing Broker Owe to a Customer?

Very often, a listing broker, particularly a lease listing broker, will also work with a tenant or a buyer as a customer.  The duties owed to that customer by the listing broker are defined in BRETTA § 10-6A-5 - Duties and responsibilities of broker engaged by seller. 
The listing broker must timely disclose the following to all parties, including the customer.  Remember, failure to disclose can result in a claim of fraud.  

​(1) Known Adverse Material Facts which could not be discovered by a reasonably diligent inspection of the property by the buyer.  This includes material defects in the property, environmental contamination, and facts required by statute or regulation to be disclosed. 

(2) Known Physical Conditions in the Immediate Neighborhood within One Mile of the Property and which could not be discovered by the buyer upon a diligent inspection of the neighborhood or through the review of reasonably available governmental regulations, documents, records, maps, and statistics.
 
There is No Broker Duty to Discover or Seek To Discover
There is no duty on the part of the broker to discover or seek to discover either adverse material facts pertaining to the physical condition of the property or existing adverse conditions in the immediate neighborhood. But if the broker actually knows adverse material conditions, they must be disclosed.
 
Buyer Has a Duty to Inspect
Georgia is a caveat emptor state - Buyer Beware.
The buyer is still obligated to inspect and to familiarize themselves with potentially adverse conditions related to the physical condition of the property, any improvements located on the property, and the neighborhood in which the property is located. Further, the buyer is charged with a review of reasonably available governmental regulations, documents, records, maps, and statistics.
 
Additional examples of the listing broker’s requirement to disclose:  

• A murder suicide on the property.  No, don’t have to disclose, unless asked.  If asked, the broker must answer honestly.
• A proposed road widening. No, don’t have to disclose, because it is proposed only.
• A quarry within 1 mile. No, so long as it can be observed with a reasonably diligent inspection by the buyer.
• Nearby child molesters.  No. It is a part of the buyer’s duty to look for available information.
• Property not zoned residential, but the property is grandfathered as residential. No, there is no duty to disclose.  Zoning is discoverable.
• Flood plain. No.  Easily attainable information.
• Covenant not to have pets.  No.  Covenants are discoverable by the buyer as a part of a title search. 
• A new community rule against short term rentals.  This is a gray area.  It is best to err on the side of disclosure.
• Cemetery on acreage next door to the property hidden by a hedge.  No, there is no duty to disclose because the cemetery is discoverable by the buyer with reasonable diligence.  However, consider whether it is good business not to disclose. 
• A property encroachment: Legally, no, because the encroachment should be discoverable on a survey by the buyer.  However, again, it may be best to deal with it up front. 
• Nuisance neighbor.  No.  Don’t have to disclose.  It’s not a physical condition.
• A pipeline easement or utility easement in the yard.  No duty to disclose. It is discoverable by the buyer through a survey/title search.

 
There is a form in the GAR package called BROKER’S INFORMATION DISCLOSURE (F325).  If asked a disclosure question by the buyer/tenant, consider whether it is good practice to follow up with the answer in writing.  This form is designed for this situation and provides cover for a claim against a broker.