Texas Real Estate Agency - UNIT 11 - Deceptive Trade Practices and

Texas Real Estate Agency - UNIT 11 - Deceptive Trade Practices and Consumer Protection Act Flashcards Under the Deceptive Trade Practices Act, which of the following must a consumer prove about a misleading, deceptive, or fraudulent act?That it was a producing cause of the loss What is required for a real estate agent to be subject to the DTPA?That the agent made an express misrepresentation that is not advice or opinion How does a consumer prove that a person's false or misleading act was the producing cause of his harm?By showing that the consumer relied on a person's false or misleading act to the consumer's disadvantage An example of breach of warranty under DTPA might beall are examples of breach of warranty.Not more than three times economic damages are the maximum amount collectible by a consumer for what kind of action?A false, misleading, or deceptive act done knowingly Thomas is a commercial broker. He is representing the buyer in the purchase of an apartment complex in Dallas.Thomas also represents the seller. Both have authorized intermediary. The seller's attorney discloses to Thomas via email that the property has foundation issues but offers to increase Thomas' commission if Thomas doesn't tell the buyer. Thomas tells the buyer that there are no problems with the property, and the buyer ends up purchasing the property unaware of the foundation problems. Will Thomas likely be liable to the buyer for fraud?Yes, this is a classic case of fraud.Janie is a sales agent representing a seller under a listing agreement. Sally knows that the house has plumbing problems but fails to disclose such problems to potential buyers. Which of the following is a TRUE statement regarding Janie's culpability if the buyer sues her for negligence?A buyer must show that Janie has a duty to disclose the information to him.Which of the following actions must a consumer take before filing a lawsuit under DPTA?Give the would-be defendant a 60-day notice.Under the Deceptive Trade Practices and Consumer Protection Act (DTPA), proof that the defendant intended to deceive is not required in most cases.The DTPA provides that a consumer can sue if the consumer has suffered economic damages produced by unconscionable action by another. "Unconscionable" means that a person has taken advantage of the lack of knowledge, ability, experience, or capacity of the consumer to a grossly unfair degree.Misrepresentation does NOT always include the intention to deceive.Groundless lawsuitswaste time, energy, and money.To avoid claims of misrepresentation, brokers must watch what they say because they are considered real estate experts.

Sandra is a broker who has a listing agreement with Tally.The buyer, Sam, has a buyer representation agreement with VJ. Tally needs to sell her home, which is listed for $750,000. Sam wants to purchase a residential property in the range of $650,000 to 750,000. Sandra did a CMA for Tally that indicates the house should be priced at $690,000, but Tally lists it at $750,000 because she's put a lot of money into remodeling and landscaping. Sam knows about the CMA and asks Sandra for a copy. Sandra tells him than she cannot provide him the CMA because she did it for Tally. Sam makes an offer on the house for $700,000, and Tally rejects the offer. Tally ends up selling to someone else, and Sam is so upset, he hires a lawyer and sues Sandra and Tally. Which of the following is the BEST defense for Sandra?Sandra did not engage in a false, misleading, or deceptive act.Is a real estate broker in Texas allowed to accept a listing that will be sold "as is?" Yes, the TREC-promulgated contract contains an "as is" clause.A consumer has sent a demand letter to a broker notifying the broker that the consumer has filed a lawsuit against the broker for violations of the DTPA. The demand letter indicates how the broker has caused harm to the consumer and indicates that the consumer will be asking for a trial by jury in order to have a jury tell him how much damage he has suffered based on the broker's actions. Does the demand letter comply with the DTPA?No, the demand letter must be sent at least 60 days before a lawsuit has been filed.Deceptive acts in a real estate transaction may have a greater impact on the consumer than in other areas because all of these are reasons for a greater impact on the consumer.In a cause of action under the DTPA, consumers are required to prove that the misleading or deceptive act was a substantial factor to their injury.Which of the following is a required element of fraud?Intention to deceive Sandra is a broker who has a listing agreement with Tally and a buyer representation agreement with Sam. Both have consented to intermediary should the situation present itself. Tally needs to sell her home, which is listed for $750,000. Sam wants to buy some investment property for his company's (ICOR, LLC) portfolio. He wants to purchase a residential property in the range of $650,000 to 750,000. Sandra did a CMA for Tally that indicates the house should be priced at $690,000, but Tally lists it at $750,000 because she's put a lot of money into remodeling and landscaping. Sam knows about the CMA and asks Sandra for a copy. Sandra wants to get this listing sold quickly, and if it closes as an in-house sale, Sandra reaps more than if it sold to a buyer represented by another

broker, although she knows that Tally needs to net as much as possible from the sale. Sandra provides the CMA to Sam without telling Tally. Sam makes an offer on the house for $700,000, and Sandra tells Tally she should accept because it is the CMA price, and the house has been on the market for a whole week with no offers. The sale closes and funds, and Tally sues Sandra and Sam when she finds out about the CMA. Does Sandra have a defense, and if so, what is the BEST reason why or why not?No, although she was providing advice as a broker, she had an ulterior motive for Tally to accept the lowball offer, Which of the following is an example of the kind of relief a consumer can get under the DTPA?All of these A recent homebuyer believes that she overpaid for a property because no one informed her that a nearby vacant lot was being rezoned for commercial use. A discount hotel is planned for the site. The broker said he did not think that information was relevant to the buyer. Which of the following must the homebuyer prove in order to make a misrepresentation claim against the broker?The broker owed a duty to the homebuyer to disclose the rezoning information.Clarice was a buyer in a transaction where Hannibal served as her broker. There was no written broker representation agreement. Clarice was not happy with the services

Hannibal provided, although Hannibal did his best under difficult circumstances. Clarice did not listen to any of his advice and made uninformed decisions. She clearly did not like him, but Hannibal was not sure why. After the sale closed, Clarice filed a lawsuit against Hannibal, but she did notify him of her intent to sue with a phone call 30 days before she filed suit. Hannibal did not answer the call, so she left a message telling him she was going to sue, that she wanted $3 million in damages, and that she would see him in court. Hannibal hasn't received any notice from Clarice about the lawsuit. Has Clarice complied with the DTPA?No, the phone call is not the equivalent of a written demand letter.