5 Written Questions
5 Matching Questions
- What is a "subagency?"
- Revocation by principal
- How are Actual and Apparent authority different?
- Duty 4: Expert advise
- What is a Special Agent?
- a When in doubt, sub it out! Don't be a hero and try and be everything to your principal! A licensee must advise the principal to seek expert advice on any matters relating to the transaction that are beyond the agent's expertise (such as matters best handled by a lawyer or a home inspector).
- b 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.
- c This agent has limited authority to do a specific thing or conduct a specific transaction. In most cases, a real estate broker is a special agent because she has only limited authority; for instance, she can only negotiate with third parties and cannot sign a contract on the seller's behalf. (She would need a power of attorney to bind the seller.)
- d Actual authority is authority granted to the agent by the principal, either expressly (written or orally), or by implication (the authority to do what is necessary to carry out actions that were expressly authorized) -- A person has apparent authority when he has no actual authority to act, but the principal negligently or deliberately allows it to appear that the actions are authorized. The principal may be liable for acts committed by an apparent agent (or ostensible agent)
- e 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
5 Multiple Choice Questions
- In addition to the general duties that licensees owe to any party to whom they render services, there are specific duties that licensees owe to the parties they represent. If the agent represents the seller, these duties are owed only to the seller. If the agent represents the buyer, these duties are owed only to the buyer. If the agent is a dual agent, these duties are owed to both buyer and seller.
- 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).
- BROKERS ARE ULTIMATELY THE AGENT! A real estate salesperson cannot act directly as the agent of a principal in a real estate transaction. Rather, the salesperson acts as the agent of his broker, and it is the broker who acts as the principal's agent.
- 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.
- Implied agency: one not expressed in words, but understood from actions or circumstances.
5 True/False Questions
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
Are taxes withheld from independent contractors? → Important employment and tax laws apply when someone is classified as an employee, particularly those involving the withholding of income taxes and social security. Unlike employees, independent contractors do not have taxes withheld from their earnings.
What is an inadvertent dual agency? → A universal agent is authorized to do anything that can be lawfully delegated to a representative.
Duty 5: Good faith and continuous effort → When in doubt, disclose it out!!! A licensee must disclose any potential conflicts of interest to the principal, such as any relationship between the agent and a prospective buyer. (For instance, if the buyer is a friend, relative, or business associate of the agent.)
Duty 4: Disclosure of material facts → A licensee must disclose any material fact, if the fact is not apparent or readily ascertainable by the party.