Real Estate Agency Law Flashcards
What governs real estate agency relationships?
Real Estate Brokerage Relationship Act (REBRA).
What is the relationship between the agent and principal?
The agent is the person authorized to represent another, and the principal is the party who authorizes and controls the acts of the agent. Principal also called client.
What is a third party called in an agency relationship?
A customer.
How is agency by express agreement formed?
Typically by written agreement, this covers most agencies (listing agreement, buyer agency) where the agency is agreed upon upfront for a specific purpose. It does not need to be in writing or supported by consideration.
What is agency by ratification?
Agency created by ratification is when the principal gives approval after the acts are performed. Can be express or by accepting the benefits of the agency acts.
What is agency by Estoppel?
Agency by estoppel is when the principal allowed a third-party to believe there was agency authority.
What is agency by implication?
Implied agency is one not expressed in words but understood by actions or circumstances.
How is Agency created under WA Law?
With a written, signed, listing or buyer brokerage agreement. Once the agency has been formed the principal is bound by the acts of the agent that are within the scope of authority.
What are the three scopes of authority for agents?
Universal - can do anything that can be lawfully delegated.
General - can do anything within one or more specific areas (property management is general)
Special - limited authority to do a specific thing or conduct a specific transaction/series of related transactions.
Actual vs. Apparent Authority
Actual authority is authority granted, apparent authority when they have no actual authority but the principal (negligently or deliberately) allows it to appear that the actions were authorized.
Apparent agent also called ostensible agent.
What is Vicarious liability?
The principal may be held liable for their agent’s wrongful acts. No vicarious liability in WA Law.
What is Imputed Knowledge?
Under general agency law principal is considered to have all the knowledge that the agent does, even if they were never told. Not present in WA Law.
What are the duties in an agent relationship?
General:
- Reasonable care and skill
- Honesty and good faith
- Presenting all written communication
- Disclosure of material facts
- Accounting for trust funds
- Providing an agency law pamphlet
- Making an agency disclosure
What is a material fact?
A material fact is anything that has a substantial negative effect on the value of the property or the party’s ability to perform her contractual duties. Seller may not rely on “buyer beware”
What is a latent defect?
Defects that are not visible or apparent. Contrasting with patent defects, which are readily apparent. Both must be disclosed.
