CH 24

The agent has a duty to inform the principal of matters that only relate to financial matters of the agent agreement.

False

A person of confidence and trust in relating to another person's property is called which of the following

Fiduciary duty

When a party is not at fault, that person should be free from liability, or they are owned a duty to _______.

Indemnify

A power of attorney is best described as which of the following?

Instrument authorizing another to act on his/her behalf.

Linda is a realtor trying sell her mom's house. Her ex-husband is interested in buying her mom's house. If Linda chooses to act as both a buyer and seller agent, she runs the risk of violating her duty ________.

Of loyalty

If a third party is aware of a principal but does not know the identity of the principal, that principal is considered which of the following?

Partially disclosed

A duty that is closely related to the duty to follow instructions is which duty?

Remain within the scope of the authority

Jim was called to active duty in the military. Knowing that he would be out of the country for a year or more, he gave his sister Peg authority to pay bills in his name, access his bank accounts, buy and sell stock in his brokerage accounts, and incur expenses to maintain his house and car and boat. Jim received several dividend checks from his stock broker while he was gone. Peg cashed the checks instead of depositing them, and then the cash was stolen out of her wallet. The loss of cash ______

Are Peg's responsibility

Farmer Brown hired Cody Cooper to remove all the corn from the corn fields. Cody is then to take all the corn to town to the local Co-Op. Before harvesting began, a tornado destroyed all the corn. Cody's agency appointment is terminated:

As an operation of law.

A person acting for another under a grant of special power is called which of the following?

Attorney in fact

Jim was called to active duty in the military. Knowing that he would be out of the country for a year or more, he gave his sister Peg authority to pay bills in his name, access his bank accounts, buy and sell stock in his brokerage accounts, and incur expenses to maintain his house and car and boat. By Jim signing a power of attorney, Peg will be named as a(n) _______________.

Attorney in fact

If Jones Company hired John to work for one year. John has the right to do all but which of the following

Behave in such a way to breach the contract

Sven, a famous Hollywood star, has hired Jonathan to find a castle in the Hills for Sven to retreat to and hide away. Jonathan is acting as Sven's ________.

Broker

Tucker hired SoShed to locate a new storage shed to purchase to store his cleaning supplies. SoShed's status of that of a(n) ________________________.

Broker

If a bankruptcy court orders relief that allows the continuation of the principal's business activity, the agency relationship sill must be terminated.

False

Once the agent becomes aware of the death of the principal, the agency agreement ends.

False

The law of agency is based on which of the following?

Case law

The law of agency was based on which of the following?

Case law

Most agency relationships, including employment situations, involve a(n( ____________ principal

Disclosed

Ann Agent was hired by Bob Buyer to help Bob locate an office to rent for his business. Ann has found a really nice office by the lake, and fell in love with the view. Ann would love to rent the office for her own use. However, in doing so, Ann is breaching which of the following?

Duty of loyalty

Jane is an attorney who represents an employee in their claim of malpractice. Jane also has represented the doctor in a previous lawsuit. Jane should disclose this information to ensure she does not violate which of the following?

Duty of loyalty

Terri Teacher is a full time typing teaching at Big College. Bigger University wants to hire Terri Teacher to work for them part time to recruit typing students. Big College may consider such a part time job a violation of Terri's ___________.

Duty to account

Money that was reasonably spent by the agent on behalf of the principal should be repaid under which of the following?

Duty to reimburse

As a matter of law, principals have a duty to pay for all but which of the following?

Expenses as allowed by law

Bill hired Saul to sell his classic car. Saul took the car to a classic car showcase. Saul is Bill's __________________.

Factor

David gave Joy his collection of rare coins to sell at the local coin show. Joy was directed to get the "best deal" because she is an expert in rare coins. Joy is acting on behalf of David as a _______

Factor

A broker acts on behalf of the agent in real estate transactions.

False

A factor has a property interest and may sell the property in his/her own name, just as a broker can.

False

A formal instrument that is used to confer an agent's authority is referred to as a attorney at law.

False

A majority of states have held that a contract of an agent on behalf of a minor principal is not voidable.

False

A principal is undisclosed if the agent does not know the principal's existence.

False

A special agent is one who has authority to transact all the business of the principal.

False

A typical commission a multiple listing agreement is evenly split between a listing broker and selling broker.

False

An agent always has the right to terminate an agency

False

An agent is entitled to be indemnified for all tort losses.

False

Only the principal may terminate an agency agreement.

False

Jim was called to active duty in the military. Knowing that he would be out of the country for a year or more, he gave Peg to buy and sell stock in his brokerage accounts, and work as his financial advisor. Peg is Jim's______________.

Special agent

Mike is a sole proprietor who buys, sells and repairs kilns and other equipment used in pottery making. He has an arrangement with Kirk to sell only the kilns at trade shows. Kirk can negotiate the sales on Mike's behalf. Kirk is considered a ________.

Special agent

While Jim is away on active duty, he hired Bob to sell his house. Bob has found a buyer for the house. If Jim wants Bob to be able to act on his behalf, including signing a purchase agreement, Jim should appoint Bob which of the following?

Special power of attorney

Pat hired Mike to sell the performance enhancing powder he has patented. The FDA has claimed the powder is prohibited by use. What is the status of the agency agreement?

The agency was terminated by operation of law

An agent has a duty to protect the principal's confidential information applies to all but which of the following?

The agent's personal information

If a debtor's position seeks Chapter 7 liquidation, which of the following occurs?

The organization's bankruptcy terminates all of the agencies.

Sally is a traveling salesperson. Share often sells products on the road. Sally will deposit the payments in her account and write a check to her boss on Friday for those funds from these sales. Sally has breached her duty ________.

To account

Bankruptcy of a principal or agent causes the agency agreement:

To be terminated by an operation of law

Indemnify means which of the following?

To hold a person harmless

A partially disclosed principal is ___________

Treated the same as an undisclosed principal in legal matters

A broker is an agent who has limited authority to sell or exchange property.

True

A special agent works on behalf of the principal in particular transactions.

True

A trade secret is an example of confidential information that must be protected by the agent.

True

A trade secret is an example of confidential information that should be protected by an agent.

True

A typical multiple listing commission spit is 60% to the selling broker, 30% to the listing broker, and 10% for operating expenses.

True

An agent has a fiduciary duty to act in a position of trust on behalf of the principal.

True

An agent should not comingle the principal's funds with his or her own to protect the duty to account.

True

An employee has a duty of good faith to exercise reasonable care and diligence in performing tasks for the employer.

True

An undisclosed principal exists if a third party does not realize an agency relationship is in place.

True

Bankruptcy of a principal only has the effect of termination when it affects the subject matter of the agency.

True

Courts consider advanced commission payments a minimum salary.

True

Since a principal is in a position of trust, he/she has an obligation of loyalty to the agent.

True

The agent has a fiduciary duty of trust to the principal.

True

The person contracting with an independent contractor and receiving the benefit of his/her service is called a proprietor.

True

An agent should not undertake a business venture that competes with the principal's business due to the agent's duty of loyalty.

True.

If a principal-agent relationship is considered a fiduciary relationship, it is also called which of the following?

Two-way obligation

Sam Superstar hired Angie Agent to negotiate a contract for him to buy part of a football team. Sam prefers to remain anonymous during the contract negotiations. In these circumstances, Athlete Superstar is a (n) ____________principal.

Undisclosed

As a general rule, either party of an agency agreement has the full power to unilaterally terminate the agreement:

Whenever desired

Amanda is a hair stylist working for Cut Cut. Amanda is starting her own business and downloaded all the email addresses of the clients for her new business. Since Amanda is now a new small business owner, she believes this is justified. Has Amanda violated any duties?

Yes, Amanda violated a duty to protect confidential information