Chapter 2 Agency Flashcards
What is a principal?
A client
What is vicarious liability?
the responsibility one individual has for the acts of another
An agent can create vicarious liability through such actions such as….
- misrepresentation
- careless statements
- not disclosing certain details that could be material
- driving clients under the influence
- failure to follow federal or state laws
- being an agent in an area of no expertise
What must a broker do within 5 business days if the agent leaving does NOT wish to transfer their license to another brokerage?
broker must return the agents license to the real estate commission (NJREC)
When the grantor dies, does the POA become void?
Yes
What are some reasons for terminating agency?
- the purpose has been met
- mutual agreement
- court order
- death of principle or sometimes the broker
- broker had their license revoked
Ostensible Agency
when a principal does nothing to stop someone from acting as their agent which would make a 3rd party think an agency relationship exists
Agency by Estoppel
when a principal allows a person to act as their agent even though no agency relationship existed
Buyer commission rebates are determined by the…
broker
In Real Estate Parlance…
the CLIENT is the one you work FOR
the CUSTOMER is the one you work WITH
If an agent wants to go to a different brokerage, what must the terminating broker do?
must report the termination on his REC portal to the commission within 5 business days
What is a subagent?
an agent of an agent ; whom the principal authorizes to act on behalf of his designed agent
What is a transaction broker?
(has no agency relationship with customers)
-a facilitator helping the buyer or seller (customers) find what they are looking for and to help go through the transaction smoothly
What is dual agency
an agency represents both parties (buyer & seller) in the same transaction
What is a sellers agent
aka listing agent
-whom represents the seller
What is a buyers agent
whom represents the buyer
When must you disclose who you represent?
during the 1st substantive business discussion
What is general agency?
broad but not unlimited authority granted by the principal
What is universal agency?
unlimited authority granted by the principal
What is an agent?
a person who represents and has a fiduciary duty to a client
What is the duty to a customer?
HARD
- honesty
- accountability
- reasonable car
- disclosure
Does your transaction broker give you advice and represent the interest of one party over another?
NO
What is a power of attorney?
the authority a principal gives to a person called an attorney-in-fact to conduct specific or unlimited duties on the principal’s behalf
Does the attorney-in-fact have fiduciary duty to the principal?
Yes
The customer is the one you work with…TRUE OR FALSE
True
The client is the person you work for …. TRUE OR FALSE
TRUE
When must you disclose your dual agency status?
before any discussion of a confidential nature takes place
What document must be signed by the client at the first face-to-face meeting?
Consumer Information Statement (CIS)
What happens if the client refuses to sign the CIS?
You must advise them that they will not be owed any fiduciary duty by the agent
What is the consumer information statement?
its a document that describes the agents business relationship with the client
Before someone can participate in RE transactions what must the broker & licensee do/center?
licensee business relationship agreement
What makes a POA void?
has to be in writing and notarized
POA is the actual authority
Attorney-in-fact is the actual person
True or False
True
What is Express Agency
oral or written agreement that clearly states the duty of the agent assigned by the principle
What is Special Agency?
principal grants narrow or specific authoruty
Does the transaction broker owe fiduciary duty to customers?
No
Must you provide a written notice that you would like to terminate the relationship with your broker?
Yes
What is single agency?
represents only the buyer/seller/landlord or tenant in a relationship & neither the agent nor any other licensee within the agents brokerage can represent the other side of the transaction
Whats your fiducairy duty to a client?
OLDCAR Obedience Loyalty Disclourse Confidentiality Accountability Reasonable care
