Section 4: Agency Flashcards

Section 4: Agency Flashcards

Landlords AgentSpecial Agent: Assists the landlord in finding a tenant.

Sub-agentSpecial Agent:Works under another agent with the

principal's permission to perform some of the acts of agency. Agents are also sub-agents of their broker.T/F Escrow officer is a limited agent?True Imagine that you're an active real estate licensee as well as an architect, and you'd like to partner with a builder who's just beginning a development. Which of these creates agency coupled with interest?You agree to design the houses for this builder in return for getting the listings when the properties are finished.AgentSomeone who acts on behalf of someone else

Dual agentSpecial Agent: Represents both the buyer and seller in the

same transaction.CustomerSomeone who's working with a real estate licensee, but who isn't represented by him What does OLD CAR stand for?Obedience: Agents must obey all of their clients' lawful

instructions.Loyalty: Agents must put their clients' interests

ahead of all others, including their own.Disclosure: Agents

must disclose all facts pertinent to the

transaction.Confidentiality: Agents must keep any

confidential information their clients share confidential.Confidentiality is a duty that survives the termination of the

agency relationship-it lasts forever.Accounting: Agents

must promptly account for all money, property, and paperwork entrusted to them by their clients. Accounting also survives the termination of an agency

relationship.Reasonable skill and care: Agents must

provide clients with quality, knowledgeable, and prudent service, and live up to the trust their clients have placed in them.RatificationAcceptance after the fact, either through paperwork or actions of the parties.Dual agent with designated sales agentSpecial Agent: A brokerage representing both parties in a transaction, with one agent representing the buyer and the other representing the seller. This is designated agency.The broker is a dual agent.ConsumerSomeone who uses or purchases a product or service ClientSomeone who has agency representation with the real estate licensee Duties not owned by a non-agent to a customer Obedience - A licensee need not obey the instructions of a non-clientLoyalty - A non-agent doesn't owe loyalty to an unrepresented person

Rex has a reputation in the community for being a bit odd.He listed his ranch for sale and insisted on the low price he's placed on it, though his agent told him it's underpriced.Rex's distant family hears of the potential sale, and they go through the courts to present evidence that Rex isn't legally competent to manage his business affairs; the judge agrees. What's the status of the listing agreement?The listing agreement is terminated by force of law.You may only engage in dual agency if.... 1. State law allows it, and you follow the state law2.Your brokerage specifically allows it according to the written rules your broker has established.3. Both the buyer and seller consent to you acting as a dual agent.T/F Non-agent is FacilitatorTrue

Seller's AgentSpecial Agent: Represents only the seller in the transaction

In which of these situations is Ronna's fiduciary duty of reasonable skill and care at odds with her duty of obedience?Ronna's duty of reasonable skill and care prohibits her from providing legal advice and supersedes her duty of obedience to Jefferson, her client.

Non-agentTransactional broker: Facilitates paperwork but doesn't act

in a fiduciary capacity.Universal Agentis someone with broad authority to act in all matters. An example of this would be someone who acts in the role of a conservator, or who holds a broad power of attorney.Power

of attorney: The right to act for someone else in a legal

transaction.Attorney of fact: A person authorized to act for

someone else in a legal transaction.As a non-agent or facilitator to both parties, the licensee

still owes both parties the following duties:

ConfidentialityReasonable Skill and CareDue DiligenceDisclosureVicarious Liability (Respondeat Superior)Imputed NoticeAccounting Express AgencyAn agency relationship based on a formal agreement between the parties.Cam is a broker. His licensees, Jane and John, represent two sides in a single transaction. Jane represents the seller; John represents the buyer. What relationship does Cam have to the buyer and the seller?Cam is a dual agent to both the buyer and seller. (Dual agent represents both parties) Define Sub-AgentA licensee who works for one firm but who is engaged by another firm to perform agency functions on behalf of that firm's client.Pam is a licensee with SMS Agency and has just listed a property for her seller client, Bob. Dan is a licensee with DTWN Associates and is working under Pam on this listing to assist Bob.How can an agency coupled with interest be terminated?There are no circumstances where the agency relationship can be terminated when it's coupled with interest.Duties of Buyers AgentShow them properties that meet their criteria and fall within their budget.Ensure that they receive all required property condition disclosures from the seller.Ensure that they understand the importance of due diligence, including a

professional inspection of the property.Review transaction documents with them, clarifying anything that could be confusing, without stepping outside the scope of your license (in other words, refer buyers to an attorney for interpreting any legal consequences or language).Negotiate contract terms that are fair and agreeable to them.We are moving because ________ But dont tell potential buyers. How do you handle this with obedience?The reason you plan to move is not something that needs to be told to prospective buyers. I'm happy to follow your instructions not to disclose this to any buyers.

Designated Agencyone way that states may allow a broker to avoid dual agency even when two agents from the same brokerage are involved. The broker designates two of the brokerage's

agents: one to represent the buyer and one to represent

the seller. In such a scenario, the two agents are designated agents, and the broker is a dual agent in the transaction. The two designated agents and the broker must generally follow rules that attempt to protect the clients' interests. This allows each client to have the benefit of single agency, but the brokerage earns the commission from both sides in the transaction.

Tenant's agentSpecial Agent: Assists the tenant in locating and securing

an appropriate property to lease.EstoppelPreventing (Stopping) a legal claim that is contrary to the person's own actions Which one of the following tasks must licensees perform for seller clients?Ensure the collection of the earnest money deposit from the buyer. Earnest money may be used as liquidated damages by the seller in the event of buyer default, so it's in the seller's best interest to ensure it's been deposited.Limited agentA limited agent is someone who acts in a very limited capacity. An example would be an escrow officer, who is acting on behalf of both parties to a transaction, but in a limited role. The escrow officer doesn't represent either party. Real estate licensees can also be limited agents. For instance, some licensees will merely post a seller's listing on the MLS but won't act in any advisory capacity to a seller. That's a limited agent.General Agent vs. Special AgentResponsible for all dealings of a client's specific piece of property vs. limited authority to act on a client's behalf Which of the following situations is an example of a non-agency relationship?Dutton was previously a licensee. He's selling his home, and he wants Wanda, who's currently licensed, to assist him with the paperwork.A non-agent, also referred to as a transaction broker, may assist a customer with ministerial tasks.Hannah is working with a buyer client on an offer for a property that's just right for the buyer. By the time Hannah receives the check for the earnest money, it's after 5 p.m.on a Friday, the bank has closed, and the seller is out of town for the weekend. Hannah puts the check in her briefcase for safekeeping.On Saturday morning, Hannah takes the check to her bank and deposits the earnest money into her personal account. Expecting a commission check to clear, Hannah writes a check from her personal account to make her car payment, just in time.On Monday, she'll write another check from her personal bank account