Question
Andrea Pendergast is a real estate agent. She has just listed for sale a large commercial property belonging to Davis Industries. The list price of
Andrea Pendergast is a real estate agent. She has just listed for sale a large commercial property belonging to Davis Industries. The list price of the property is $1.1 million. Davis Industries is owned by Erin Davis, who is Andrea's sister. The standard listing agreement has the agent charge a commission of 5% of the purchase price, with 2.5% going to each of the buyer's and seller's agents. An agent acting on behalf of both the buyer and seller would be able to claim all 5%.
Martin Camber, a developer, inquired about the property and subsequently put in an offer of $750,000. Earlier the same day, Andrea had received a call from a Marcella Thomas, who suggested she might like to come view the property.
When Andrea received Martin's offer of $750,000, she immediately advised Martin that there had been another person who was "very interested" in the property and she wouldn't be surprised if an offer was forthcoming from that person within the day. She suggested however, that if Martin could come back with a price between $975,000 and $1 million, she was sure she could secure the sale for him.
Martin came back with the full asking price of $1.1 million in his desire to "seal the deal" and defeat the potential other offer he believed was forthcoming. The building was sold to Martin, with Andrea acting as agent for both the buyer and the seller.
Is there anything wrong with how Andrea handled herself in this situation? If so, what are the issues?
Please provide a detailed answer
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