Legal Aspects Ch. 9- Agency Law

Question 1

Agency

Answer 1

Legal relationship in which a principal authorizes an agent to act as the principal’s representative when dealing with third parties

Question 2

Fiduciary Relationship

Answer 2

Implies position of trust and confidence

Question 3

Agent

Answer 3

Person who has the authority to act on behalf of another, representing the business interest of that person

Question 4

Principal

Answer 4

Client who gives authority to an agent to represent his or her interests in dealing with third parties

Question 5

Third party

Answer 5

Customer who may be affected by the terms of the agreement but who is not a part of the agreement

Question 6

General Agency

Answer 6

Relationship in which a principal delegates ongoing task or duties to an agent under his or her employ

Question 7

Special Agency

Answer 7

Relationship in which a principal delegates limited tasks or specific duties to an agent under his or her employ

Question 8

Cooperating Broker

Answer 8

Selling agent who assists another broker by finding a buyer

Question 9

Dual Agent

Answer 9

Broker acting as agent for both the seller and the buyer in the same transaction

Question 10

Sales Associate

Answer 10

Licensed real estate sales person or broker whose license is held by an employing licensed broker

Question 11

Right to Control

Answer 11

How much direction the broker exercises over the person the broker has hired

Question 12

Power of Attorney

Answer 12

Written document that gives a person legal authority to act on behalf of another person

Question 13

Ratification

Answer 13

Acceptance of an act already performed

Question 14

Estoppel

Answer 14

Legal bar that prevents a person from asserting facts or rights that are not consistent with what was implied by the person’s previous behavior

Question 15

Obedience

Answer 15

Willingness to follow the orders of others

Question 16

Confidentiality

Answer 16

Discretion and holding privileged information

Question 17

Material Fact

Answer 17

Any fact that would seem unlikely to affect the judgment of the principal in giving consent to the agent to enter into the particular transaction on the specified terms

Question 18

Misrepresentation

Answer 18

Making a false statement or concealing a material fact

Question 19

Respondeat Superior

Answer 19

“Let the superior answer”

Question 20

Indemnification

Answer 20

Protect against damage, loss, or injury, or to make compensation for damage, loss, or injury