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Law of Agency > Module 2 > Flashcards

Module 2 Flashcards

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1
Q

Authority that comes from specific instructions, either written or oral.

A

Express Authority

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2
Q

Authority given because it is the standard practice, the norm or customary in the industry.

A

Implied Authority

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3
Q

When a principal inadequately supervises an agent, and the agent takes on powers beyond the scope of authority given by the principal.

A

Agency by Estoppel

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4
Q

Exists when an individual grants express authority to the agent to perform some act, orally or in writing.

A

Agency by Actual Authority

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5
Q

The power to act for the principal in ALL transactions.

A

Universal Agency

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6
Q

Also known as Limited Agency; the agent may only perform limited duties for the principal. The agent must simply follow the instructions of the principal.

A

Special Agency

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7
Q

The right to represent the principal in a particular type of transaction or business.

A

General Agency

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8
Q

Actions lead another person to assume that one is an agent.

A

Ostensible Agency

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9
Q

Established when an agent acts without prior authorization and the principal accepts it.

A

Agency by Ratification

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10
Q

Exists when a broker is the owner of a property being sold or is interested in buying a property

A

Agency Coupled with an Interest

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11
Q

The right to represent the principal in a particular type of transaction or business.

A

General Agency

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12
Q

Authority that comes from specific instructions, either oral or written.

A

Express Authority

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13
Q

The power to act for the principal in all transactions.

A

Universal Agency

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14
Q

Established when an agent acts without prior authorization and the principal accepts it.

A

Agency by Ratification

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15
Q

Also known as Limited Agency.

A

Special Agency

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16
Q

Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

A real estate agent is selling his house as a For Sale By Owner (FSBO) and is not using the brokerage to represent him.

A

Yes

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17
Q

Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

A real estate agent represents her cousin who is buying a condominium.

A

No

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18
Q

Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

A real estate agent with an inactive sales agent license wants to make an offer to purchase a house.

A

No

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19
Q

An investor, who wholly owns an LLC that will purchase a commercial Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

retail center.

A

No

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20
Q

Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

A real estate agent represents his parents who are buying a second home on the beach.

A

Yes

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21
Q

Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

A real estate agent who has 5% ownership of a corporation that is buying a rental house.

A

NO

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22
Q

Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

A real estate agent represents his sister who is buying a house to live in.

A

No

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23
Q

Choose Yes or No to indicate which relationship an agent must disclose to another party in a transaction:

An LLC is purchasing a home to remodel and then lease to a residential tenant. A real estate agent is 25% owner of the LLC.

A

Yes

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24
Q

A written listing agreement, buyer representation agreement, or oral instruction gives

A

Express Authority

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25
Q

Implied agency is the

A

norm or what is customary

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26
Q

BLANK are held to the highest amount of good faith and are required to exclude all selfish interests.

A

Fiduciaries

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27
Q

A property manager is an example of a

A

general agent

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28
Q

Choose the most appropriate type of agency: A broker manages rental properties for a landlord.

A

General Agency

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29
Q

Choose the most appropriate type of agency: A sales agent sponsored by a broker

A

General Agency

30
Q

Choose the most appropriate type of agency: Buyer Representation Agreement

A

Special Agency

31
Q

Choose the most appropriate type of agency: A seller lists a home for sale

A

Special Agency

32
Q

Choose the most appropriate type of agency: The broker representing a tenant in a commercial real estate transaction

A

Special Agency

33
Q

Choose the most appropriate type of agency: An agent with authority to conduct any and all business for the client

A

Universal Agency

34
Q

Choose the most appropriate type of agency: The most limited form of agency

A

Special Agency

35
Q

Choose the most appropriate type of agency: An agency relationship with authority in a particular area of business

A

General Agency

36
Q

Choose the most appropriate type of agency: An agent with no authority to bind the client.

A

Special Agency

37
Q

Choose the most appropriate type of agency: An agent with no authority to sign or initial anything on behalf of the client

A

Special Agency

38
Q

Choose the most appropriate type of agency: An agent with the authority to sign a listing agreement on behalf of a broker.

A

General Agency

39
Q

The broker is responsible for the following types of activities on the part of sponsored license holders:

A

Compliance with fair housing laws

Compliance with advertising regulations

Use of promulgated forms

Compliance with regulations for disclosure

Compliance with all aspects of the Texas Real Estate License Act

40
Q

The broker is not responsible for the following types of activities on the part of sponsored license holders:

A

Timely renewal of license

Completion of continuing education requirements

Adequate opportunities for generating income

Company car, health insurance, vacation, or disability benefits

41
Q

True or False: The broker is responsible for compliance with fair housing laws

A

True

42
Q

True or False: The broker is responsible for an agent’s health insurance

A

False

43
Q

True or False: The broker is responsible for compliance with advertising regulations.

A

True

44
Q

True or False: The broker is responsible for providing adequate opportunities for generating income.

A

False

45
Q

True or False: The broker is responsible for use of promulgated forms.

A

True

46
Q

True or False: The broker is responsible for providing a company car.

A

False

47
Q

True or False: The broker is responsible for compliance with regulations for disclosure.

A

True

48
Q

True or False: The broker is responsible for providing disability benefits.

A

False

49
Q

True or False: The broker is responsible for compliance with the Texas Real Estate License Act.

A

True

50
Q

True or False: The broker is responsible for timely renewal of an agent’s license.

A

False

51
Q

True or False: The broker is responsible for completion of an agent’s continuing education requirements.

A

False

52
Q

As agents, our fiduciary duties to clients are specific and can be remembered by using the acronym OLD CAR:

A

Obedience

Loyalty

Disclosure

Confidentiality

Accounting

Reasonable Care

53
Q

_______states that an agent will follow all of the lawful instructions of a client

A

Obedience

54
Q

_________is spending client funds without authorization

A

Conversion

55
Q

Determine which fiduciary duty the agent is violating: An agent tells others in office that the property is listed $150,000 above market.

A

Confidentiality

56
Q

Determine which fiduciary duty the agent is violating: An agent disregards an instruction given by the seller

A

Obedience

57
Q

Determine which fiduciary duty the agent is violating: A listing agent helps an unrepresented buyer when making an offer to purchase

A

Loyalty

58
Q

Determine which fiduciary duty the agent is violating: An agent commingles funds

A

Accounting

59
Q

Determine which fiduciary duty the agent is violating: An agent leaves doors unlocked after showing property

A

Reasonable Care

60
Q

Determine which fiduciary duty the agent is violating: A seller’s agent fails to inform seller that a price increase is justified based on changes in the market.

A

Disclosure

61
Q

Agent Anne is holding an open house at 123 Main St. This property is a new listing and she is very excited about it, as she feels it will sell quickly. The Smiths attend the open house and begin to question Anne about some of the property’s features. What is Agent Anne’s first course of action?

A

Agent Anne’s first course of action should be to inform the Smiths that she represents the seller.

62
Q

Agent Bob has signed a buyer’s representation agreement with the Nelsons. He is calling ABC Realty to make an appointment to show their listing at 10 Park Lane. What must Agent Bob tell ABC Realty when making the appointment?

A

Agent Bob must tell ABC Realty that he is a buyer’s agent.

63
Q

Later, when the Nelsons arrive at 10 Park Lane, they find the owners at the home. When the sellers come to the door, Bob tells them that he is a buyer’s agent. Is Bob’s oral disclosure sufficient?

A

Yes, the oral disclosure is sufficient.

64
Q

Substantive discussion triggers the need to provide the

A

The Information About Brokerage Services (IABS)

65
Q

Is the agent required or not required to provide an individual with a copy of the Information About Brokerage Services? A potential buyer visits your open house and no substantive conversation took place.

A

Not required

66
Q

Is the agent required or not required to provide an individual with a copy of the Information About Brokerage Services? You respond to an email inquiry from your website regarding a home for sale

A

Required

67
Q

Is the agent required or not required to provide an individual with a copy of the Information About Brokerage Services? A stranger on the street, knowing that you are in real estate asks you “how is business?”

A

Not required

68
Q

Is the agent required or not required to provide an individual with a copy of the Information About Brokerage Services? You visit a seller to discuss listing their home

A

Not required

69
Q

Is the agent required or not required to provide an individual with a copy of the Information About Brokerage Services? A potential buyer meets with you to discuss the purchase of an office building

A

Required

70
Q

Is the agent required or not required to provide an individual with a copy of the Information About Brokerage Services? A tenant that wants to discuss the terms of a 1 year lease. No sale is being considered

A

Required

71
Q

What form must an agent provide to a potential client at the first substantive discussion of a real estate transaction?

A

Information about brokerage services

72
Q

An example of a general agent in the world of real estate would be a (n)?

A

Property manager

Law of Agency (10 decks)

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