Agency; Listing Agreements

The agency relationship is defined by

• The Realtor Cod of Ethics

• The laws of agency, or in some states, by statute

• the law of real estate contracts

• the agreement between a principal and an agent

Which of the following is true of the connection between compensation and the agency relationship?

• An agreement to give and receive compensation creates an agency relationship.

• If an agency relationship exists, the principal must provide valuable consideration to the agent.

• The relationship is independent of any compensation arrangement.

• If an agency relationship exists, the agent is entitled to compensation.

One of the parties to an agency relationship defaults, and the agreement terminates. Which of the following is true?

• All obligations are extinguished.

• Both parties must continue to perform all other obligations of the agreement.

• The defaulting party may have a financial consequence.

• The damaged party has no claim against the defaulting party.

Among the fiduciary duties imposed on a real estate agent is the requirement to

• refuse offers the agent knows will be unacceptable to the principal.

• present all offers to the principal regardless of their amount.

• advise the principal agent against accepting an offer that is below full price.

• advise a prospect that the principal will no accept the prospect's offer in order to elicit a better offer.

One of the agent's fiduciary duties that continues even after a listing agreement expires is

• obedience

• diligence

• confidentiality

• disclosure

The standard of care and competence that a principal can expect from an agent is generally that which is

• specified in the agency agreement.

• Necessary to earn the promised compensation.

• necessary to procure a customer.

• comparable to that of other practitioners in the area.

Agent Michael is showing his new listing to a buyer who informs him that he has just inherited five million dollars. Michael is now bound by fiduciary duty to

• keep the information in confidence.

• disclose the information to the buyer's agent.

• disclose the information to the seller.

• verify the buyer's statements before disclosing them to the client.

Agent Gerry has executed an exclusive buyer broker agreement with the Andersons. The agent subsequently places an offer with Melinda, the exclusive selling agent for the Lincolns, to buy their lakefront property. The offer contains provisions for the Lincolns to pay the brokerage commission, which the Lincolns agree to. Give this set of circumstances, Gerry owes the full set of fiduciary duties to

• The Andersons

• The Lincolns

• Gerry's Broker

• Melinda's broker

A subagent is the agent of

• the seller

• the buyer

• a broker who has an agency relationship with a client.

• the client's and the customer's duties.

Which of the following is a dual agency situation?

• Two agents share the exclusive right to represent the same client on all transactions.

• One agent represents both sides in the transactions.

• A selling agent from one brokerage works with a listing agent from another brokerage to complete a transaction.

• One agent represents two sellers at the same time.