Laws of Agency and Fiduciary Duties study Flashcards

Laws of Agency and Fiduciary Duties study Flashcards Marcus is selling his rental property with the help of licensee Javier. Marcus accepts Ben's offer to purchase the property. Ben is represented by another real estate licensee, Francis. What's Ben's relationship to Javier?A.Ben is Javier's fiduciary.B. Ben is Javier's client.C. Ben is Javier's customer.D. Javier is Ben's agent.

• Ben is Javier's customer.{As a principal in the

transaction who's represented by another licensee, Javier isn't Ben's agent or fiduciary, and Ben is Francis's client, not Javier's. Marcus is Javier's client. Javier and Francis are fiduciaries for their clients.} A real estate agent is a fiduciary, meaning the agent is ______.A. Placed in a position of trust for anotherB. Placed in a position of authority over anotherC. Trained in matters of real estateD. Trained in matters of finance

• Placed in a position of trust for another{A fiduciary is

someone who is placed in a position of trust for another.Examples are real estate agents, investment advisors, and lawyers. Real estate licensees aren't fiduciaries until they agree to act in the interests of another.} Chuck represents Benny. April is buying Benny's property, but Chuck does not represent her. Which duty does Chuck owe Benny that he does not owe to April?A. HonestyB.Disclosure of material factsC. Good faithD. Confidentiality

• Confidentiality{The duty to disclose material facts

applies to all parties, as do good faith and honesty. An agent only owes the duty of confidentiality to a client, so Chuck owes this to client Benny but not customer April.} Charlie has a written agreement to represent Sue in the purchase of Darrin's property. Darrin is represented by broker Belinda. Charlie receives the cooperating broker's compensation from Belinda through his own broker, not from Sue. What's true about this situation?A. Charlie has created an undisclosed dual agency relationship.B. Charlie has agency relationships with Belinda, Darrin, and Sue because of the compensation he received.C. Charlie is Sue's agent-and no one else's-in this transaction.D. Charlie has accepted compensation illegally from a party he doesn't represent.

• Charlie is Sue's agent-and no one else's-in this

transaction.{The source of compensation doesn't change Charlie's agency relationship with Sue. It doesn't create a dual agency situation, and Charlie doesn't become anyone else's agent as a result of accepting compensation from them.} You're shopping for a home, and you ask for licensee Bart's help. The property you end up purchasing is a for sale by owner, so there's no cooperating broker's commission for Bart. According to your written agreement, that makes you liable for paying Bart's commission. Luckily, your sister is willing to help out by paying Bart, so the transaction closes, and everyone's happy. What's true about this situation?A. When your sister agreed to pay Bart his commission, he became her agent as well as yours.B.You and Bart signed an agency agreement defining your relationship, so he is your agent for this transaction and no one else's.C. Bart became a non-agent when you notified him that you were unable to pay his commission.D. You are Bart's customer, not his client, because you weren't the source of his compensation.

• You and Bart signed an agency agreement defining your

relationship, so he is your agent for this transaction and no one else's.{The agency agreement you and Bart signed makes him your agent. The source of compensation for Bart isn't relevant to that agency relationship. Aren't sisters the best?}