Key Terms - Chapter 7 Flashcards
agent
the party who acts on behalf of the principal
apparent authority
occurs when an agent gives the impression that she holds certain authority that a third party might rely upon, when in fact the agent does not actually hold such authority
breach of duty
agency can be terminated by either the principal or the broker for breaches of duty
loyalty obedience confidentiality skill, care, and diligence disclosure of information accounting
buyer agency agreement
the buyer is the broker’s principal (client)
the agency relationship is between the buyer and the broker
caveat emptor
Literally “let the buyer beware:’ Does not relieve agent’s obligation of disclosing material facts.
civil penalty
Payment or redress for a private civil wrong imposed by a civil, not a criminal, proceeding.
client
The principal, to whom the agent owes fiduciary duties.
customer
the person the agent does not represent
disclosure of information
The prompt and total communication to the principal by the agent of any information that is material to the transaction for which the agency was created.
dual agency agreement
the firm represents both buyer and seller
employment authority
A document or contract giving a real estate agent the right to act for a principal with certain specific guidelines in a real estate contract (i.e., a listing contract or a buyer’s agency contract).
estoppel
occurs when an individual claims incorrectly that a person is his agent and a third party relies on the incorrect information
the person making the incorrect statement is stopped and prohibited from later claiming that the agency relationship does not exist
express agency
when the actions of the principal and the agent indicate that they have an agency agreement
facilitator
not allowed in NC
the licensee assists buyers and sellers in a transaction but does not actually represent either party
fiduciary
the agent is entrusted to represent the best interest of the principal client
first substantial contact
A flexible standard that typically occurs when an agent and a prospective buyer discuss in any detail the buyer’s interest in purchasing property.
general agency
Full authority over one particular field of business or aspect of personal affairs of the principal (e.g., a property manager managing an apartment complex for the owner).
implied authority
based on custom and may very well be the result of an expressed agreement
loyalty
An absolute duty of an agent to a principal to serve the best interest of the principal.
misdemeanor
A criminal violation punishable by a fine and/or imprisonment. It is not considered as severe an offense as a felony
negligent misrepresentation
An unintended misrepresentation of a material fact that the party did not make knowingly but should have known the truth by exercising due skill, care, and diligence
negligent omission
An unintended failure to communicate a known material fact. An unintended failure to communicate unknown material fact by a person responsible for disclosing it because this person did not exercise the due skill, care, and diligence that would have revealed the fact.
omission
The failure to disclose information.
principal
the person for whom the agent acts
special or
limited agency
limited to one well-defined task one time
subagent
the agent of the agent
third party
the party that you do not represent
transactional broker
Not allowed in North Carolina
a type of “nonagency” relationship in which the licensee assists buyers and sellers in a transaction but doesn’t represent either party
universal agency
provides for an agent to have all-encompassing powers to make decisions and act on behalf of the principal
willful misrepresentation
A deliberate false statement concerning a material fact by one who knows the true fact and is responsible for disclosing it.
willful omission
A deliberate failure to inform a party of a known material fact when one has an obligation to that party to relay all material facts.
