Module 1 Part 1: Explaining Services to Buyers and Sellers Flashcards
In an agency relationship
the agent is authorized to represent the principal in dealing with a 3rd party
(Legislative term) Representation equals (Common marketplace term(
Agency
(Legislative term) Rep Agreement (Common marketplace term(
Listing agreement
(Legislative term) Agreement (Conveyance of interest in RE) equals (Common marketplace term)
Agreement of P&S
(Legislative term) Multiple representation equals (Common marketplace term)
Dual Agency
(Legislative term) Convey Offer equals (Common marketplace term)
Present offer
(Legislative term) Acquisition/Divestiture by registrant equals (Common marketplace term)
Purchase/Sale by registrant
Agency is the relationship bw
2 parties where 1 accepts responsibility for representing the other in dealing with a third party
REBBA term for agency
representation
Principal is the
seller/buyer
Third party
not directly connected to the agency relationship, also involved in the transactions
Fiduciary
relationship of trust with 1+ parties
Obedience (Fiduciary obligations)
obey the lawful instructions of the principal
Accounting (Fiduciary obligations)
Responsible of all documents and funds related to the transaction
Authority is the legal power
or right given by the a principal to act on their behalf in business transactions
Single agency
1 brokerage reps 1 principal
Dual agency
one agent reps 2+ principals within the same transaction
Dual agency under REBBA
Multiple representation
Concurrent representation
Dual agency
Express agreement
written or verbal representation agreement
Written agreement
documents the agency relationship through a S/B rep agreement
Ratification
agent acts w/o authority or in excess of the authority granted
Estoppel
Principal leads a 3rd party to believe they are being represented by the agent
Operation of law creates an agency relationship where
a duty is created by circumstance and is imposed on an agent to act of behalf of the principal
Effective & expiration date
must be included in a seller/buyer rep agreement
Revocation
Principal has the power to revoke the authority of the agent
Continuing responsibilities after termination of a contract
confidentiality, loyalty, protecting best interests
Two types of authority in RE
Express/actual & implied
Brokerages/SP do not have the authority to
sign contracts on behalf of a principal
Duty of indemnification
principal must compensate an agent for loss or damage incurred in carrying out lawful acts
Duty of remuneration
principal must pay the brokerage for services agreed to
Distinguishing aspect of an agency relationship is related to
providing advice - can give rise to action for damages due to negligence
Disclosures that must be made to a costumer
material facts (ought to be known)/direct or indirect interests held by the salesperson
General obligations provided to a costumer
Exercise care & skill
Ensure honesty
Negotiate favourable terms (client obligation)
successfully negotiate agreements, discuss client’s options, drafting favourable terms
Act in person
A brokerage must perform duties personally, unless instructed otherwise
Perform mandate
brokerage must perform mandate as set out in the rep agreement
3 fundamental premises for a fiduciary relationship
loyalty, best interests & trust/confidence
Do not make secret profit
improper advice, payment from another party or payment by a third party
payment by a third party
receiving a referral fee from a property inspector, appraiser or lender
SPs must comply with general and fiduciary obligations as well as
regulatory obligations
Account
under rebba the brokerage must account for, safeguard and keep proper records pertaining to money & documents
Finder’s fee
referral fee
