5 Written questions
5 Matching questions
- Termination by operation of law (their are 4 ways this happens -- think EPDD)
- Duty 5: Good faith and continuous effort
- Are agents and brokers employees or independent contractors?
- Express agreement for agency
- Ratification of agency relationship
- a Real estate brokers are virtually always independent contractors in relation to their principals. And most real estate salespersons and associate brokers are independent contractors in relation to their brokers, although in rare instances they're classified as employees.
- b Relationship doesn't last forever -- An agency relationship will terminate automatically if (1) the term of the agency expires; (2) the purpose of the agency is fulfilled (property sold); (3) either the principal or agent dies, is declared incompetent, or declares bankruptcy; or (4) the property is destroyed (e.g., burns down).
- c Most agencies are created by an express written agreement, such as a listing agreement or a buyer agency agreement. However, the agreement does not need to be in writing to create a valid agency, nor does the agreement have to be supported by consideration.
- d Approval/adoption of acts performed outside agency relationship; can be expressed or through accepting the benefit of those acts
- e Don't quit!!! Licensees must make a good faith and continuous effort to fulfill the terms of the agency agreement. For instance, a seller's agent must make a good faith and continuous effort to find a buyer for the property.
5 Multiple choice questions
- When licensee undertakes to provide real estate services; seller = begins with written agrm't; buyer = automatic, once real estate brokerage services are performed
- Real estate agents must avoid inaccuracies in their statements to prospective buyers. Opinions, predictions, or puffing - Misrepresentations, which may be grounds for a lawsuit, should not be confused with opinions, predictions, or puffing. The latter are nonfactual or exaggerated statements a buyer should know he cannot rely on
- Agent - authorized rep; Principal - controller of agent's acts; People outside the relationship are third parties. Principal who engages agent's services is the "client", but a mere third party is a "customer."
- WATCH OUT LISTING AGENT! Don't get too buddy-buddy with the buyer. Many dual agency lawsuits involve unintended dual agency, in which the seller's agent's conduct with the buyer created an agency by implication be- tween the agent and buyer.
- Under general agency law, the principal may be held liable for his agent's wrongful acts. This is known as vicarious liability. Thus, a buyer or seller may be liable for the acts of his broker or a salesperson working for that broker.
5 True/False questions
Agent's duties in general? → In addition to owing fiduciary duties to her principal, an agent owes certain duties to any party to whom he renders services. This applies whether it is a principal or a third party.
What is a "subagency?" → Real estate salesperson is broker's agent (broker being principal). Broker's principal is the seller/buyer, so a salesperson representing a broker is a "subagent", aka an agent of an agent
What are latent defects? Should they be disclosed by the agent? → Think of this as Washington's requirement that ALL the cards be put on the table: Washington law requires real estate agents in residential transactions to make agency disclosures to both the buyer and seller informing them which party (or parties) they represent.
Does it matter when the agency disclosure happens? → IN WRITING AND BEFORE!!! The agency disclosures must be made to the buyer before the buyer signs the offer, and to the seller before the seller signs the offer. The disclosure must be in writing, either in a separate paragraph in the purchase and sale agreement or in a separate disclosure document.
Unilateral offer of subagency → Dual agency exists when an agent represents both the buyer and the seller in the same transaction. Dual agency is legal in Washington, although it is discouraged. To act as a dual agent, a broker must have the written consent of both parties to the transac- tion. He must also act impartially towards both buyer and seller and refrain from acting to the detriment of either party.