General Principles of Agency 2 Flashcards
What is Universal Agency?
A Universal Agent can do anything for the principal that they can do for themselves: universal agency has no limits on authority
What is a General Agent?
A General Agent is one who represents the principal in a range of matters related to a particular business or activity. They are granted power to enter into contracts on behalf of the principal within the agent’s scope of authority through an instrument like a “Power of Attorney.”
General Agency is often used in a Real Estate transaction where:
An out-of-town client will have someone in town represent them.
An absentee spouse will give their partner/wife/husband the authority to make decisions for them as a couple.
Real Estate Agents act as what?
Special Agents
What does a Special Agent Represent?
A special agent represents the interest of the principal in one specific transaction or one business activity only, and cannot bind them to a contract.
Special Agency is created by what terms?
Listing Agreement
Purchase Agreement
Buyer Brokerage Contract.
What are the two ways Agency can be established?
Expressed Agency and Implied Agency
How is Expressed Agency Established?
Expressed Agency is established when parties state their terms of Agreement and express their intentions either orally or in writing.
How is Implied Agency Established?
Implied Agency is action; through behavior or activities the parties suggest they have mutually consented to an agency relationship.
In-order for Agency to be enforceable in a court of law, it is recommended that the agreement is in writing.
Does compensation dictate agency?
No
Some states require agency agreements to be in writing and do not recognize what type of agency?
implied agency or agency expressed verbally.
In-order for Agency to be enforceable in a court of law, it is recommended that the agreement must be in?
Writing
Can an Agent represent more than one principal to the same transaction?
Yes, an agent can acs as
Single agent
Dual agent
Multiple Agent (they represent more than one principal to the transaction)
Some, but not all states allow dual agency or multiple-representation.
What is Single Agency?
Single Agency is when the broker represents either the seller or the buyer, not both in the same transaction; any third party is considered a customer.
What is Dual Agency?
Dual Agency is when the broker represents two parties involved in the transaction.
Dual Agency is also referred as what in some states?
multiple-representation; representing more than one party in the transaction with interest adverse to each other.
Examples of conflict of interest
The sellers do not want potential buyers to know the least amount of money they are willing to take for their house; while,
The buyer does not want the seller to know how much they are willing to pay to get the house.
To properly represent both sides, an agent must first?
disclose dual agency in a way that the principal understands that there may be a conflict of interest and then get consent from all principals to the transaction.
The principals must be informed, and consent must be given in writing to move forward with multiple-representation.
In states that allow dual agency what state mandated forms must be signed?
Disclosure forms and Consent forms
What is undisclosed dual agency?
When a dual agency is created unintentionally
Example of Multi Representation
A buyer’s agent shows two different buyers the same property and both buyers would like to submit an offer. This situation requires informed consent.
What is Designated Agency?
Designated Agency: Available in some states to accommodate an in-house sale in which two sales associates of the same broker are involved, the broker will designate another agent to represent one of the parties.
What is Non-Agency also referred as?
a transactional broker, facilitator, coordinator, or contract broker
What is Non-Agency
Helps both buyer and seller with paperwork and formalities in transferring property.
Responsible to both parties and must treat them honestly and competently.
Assists parties to arrive at mutually agreeable terms and help with the closing.
Will not negotiate for parties or disclose confidential information.
Is transactional brokerage allowed in Nevada?
No
