Residential Lease: The Surety Agreement and the Real Estate Agent’s Duty of Care

Let’s assume that a rental management agreement has been formalized with a real estate agent, and that the agent has been authorized to draft the surety agreement. The real estate agent does not verify the identity of the person named in the surety agreement. If the tenant and the guarantor are sued for breach of contractual obligations, and the guarantor states that they did not draft the agreement, can the real estate agent be held liable?

The risk of the real estate agent’s insolvency is relatively low, as the agent is generally covered by liability insurance.

The real estate agent is liable for any errors they commit in the course of their duties. Indeed, under Article 1192 of the Civil Code: “The agent is liable not only for fraud but also for any errors they commit in the course of their duties.” Under this provision, the real estate agent, acting as an agent, is required to ensure the validity of the acts they perform. To hold the real estate agent liable, it must be demonstrated that the agent (who bears the burden of proof regarding compliance with the legal obligation to provide a copy of the contract to the guarantor) has failed to provide evidence that all information regarding the nature and scope of the guarantor’s obligations was conveyed.

Failure to carry out several checks—particularly regarding the guarantor’s identity—may result in the real estate agent being held liable for breach of their duty of diligence regarding the guarantee agreement. The risk of insolvency for the real estate agent is relatively low, as they are generally covered by liability insurance.