Unit 4: Real Estate Brokerage & Law of Agency Flashcards
law of agency
rights and duties of the parties in a RE transaction
principal
main party to a transaction- the person from whom the agent works
client
the person who employs an agent to perform a service for a fee
agent
one who acts or has the power to act for another
subagent
represents a principal through cooperation and consent of a broker representing the principal & who is not sponsored by or associated with the principals broker
commission
payment to a broker for services rendered
customer
one who purchases or sells property w/o being represented by an agent
general agent
authorized by a principal to perform a single act or transaction
agency
relationship between principal and agent wherein the agent is authorized to represent the principal in certain transactions
listing agreement
contract that agent is employed to sell RE on the owners terms w/in a given time and landowner agrees to pay commission
Buyer Representation Agreement
contract that establishes a broker-buyer agency relationship
express agency
created by specific agreement whether written or oral of principal and agent
implied agency
created by acts or words of principal and agent
agency by ratification
agency “after the fact”
fiduciary relationship
relationship of trust and confidence, as between trustee and beneficiary, attorney and client, or principal and agent
puffing
exaggerated comments or opinions not made as representations of fact
misrepresentation
unintentional misstatement of a fact
fraud
misstatement of a material fact made w/ intent to deceive or made w/ reckless disregard of the truth and actually does deceive
Info About Brokerage Services
notice that must be provided summarizing broker agency positions available
Appointed License Holder
appointed by broker to communicate, carry out instructions, and provide opinions and advice to whom license holder is appointed
employee
works under supervision and control of another
independent contractor
retained to perform a certain act but is subject to control and direction only as to the end result
procuring cause
effort that brings about the desired result
Ready Willing & Able Buyer
prepared to buy property on the sellers terms
antitrust laws
designed to preserve the free enterprise of the open marketplace
Caveat Emptor
“let the buyer be aware”
TX Deceptive Trade Practices Consumer Protection Act (DTPA)
makes it illegal to use false, misleading, or deceptive practices in the advertising, offering for sale, selling, or leasing or an real or personal property
Who is the person that hires the broker?
principal
What are some of the duties of the agent?
reasonable care and skill, honest and fair dealing, disclosure of known facts about the property
What should a broker obtain if they intend to receive a commission from someone other than the client?
consent of the client
When is a commission payable
on closing,
What are the requirements of the TX RE License Act?
valid license, agreement to pay in writing and signed by party to be charged, agent advised the buyer that they should obtain title insurance policy
What replaced dual agency?
intermediary agency
When does undisclosed dual agency occur?
when agent fails to disclose to a party that they represent the other party
What does antitrust laws prohibit?
brokers conspiring to fix prices, boycott competitors, or allocate customers or markets
What was the first law to regulate RE brokerage in TX?
TX RE Dealers act passed in 1939
What law currently regulates RE in TX?
TX RE License Act passed in 1949
