5 Written questions
5 Matching questions
- What are the main parties involved in an agency relationship?
- Agent's duties in general?
- What is Imputed Knowledge? (Does it apply in Washington State?)
- Duty 5: Good faith and continuous effort
- What is Vicarious liability and why does it matter in principal/agent relationships?
- a 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.
- b 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.
- c 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.
- d Under general agency law, a principal is considered to have notice of information that the agent has, even if the agent never actually tells the principal. As a result, a principal could be liable for failing to disclose a problem to a third party, even if the agent never told the principal about the problem. This rule does not apply in Washington State = Principal is NOT automatically liable for things known by his agent.
- e 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."
5 Multiple choice questions
- A licensee is obligated to present all types of written communications, including all written offers, to and from either party in a timely manner. Offers and counteroffers must be presented regardless of how unacceptable they may appear. The party, not the licensee, will decide whether or not to accept a particular offer. The licensee should present offers even if the property is subject to an existing contract (although not if the listing has expired).
- The extent to which the principal can be bound by the agent's actions depends on the scope of authority granted to the agent; Types: Universal, general, special.
- YOU'RE FIRED!!! The principal may revoke the agency by firing the agent whenever she wishes. The principal may be liable for any damages caused by the breach.
- 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
- An agent must always place the principal's interests above the interests of a third party. For instance, a seller's agent must negotiate with the buyer to get the highest price possible for the seller.
5 True/False questions
How are Actual and Apparent authority different? → 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.
In-house transaction → The most common dual agency situation is an in-house transaction, in which two different salespersons, representing the buyer and seller, both work for the same broker.
What are the four (4) ways to terminate...an agency relationship? Think Mr. RT, also, think together, then seperate forms of attack. → Mutual agreement, revocation by principal, renunciation by agent, termination by operation of law
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
Renunciation by agent → YOU'RE FIRED!!! The principal may revoke the agency by firing the agent whenever she wishes. The principal may be liable for any damages caused by the breach.