Chapter 23
destruction or condemnation of property
"acts of God." Stuff happens, and whether it's due to an accident, an earthquake or even negligence, sometimes a property is destroyed or condemned. If you're the agent representing the principal for a property that no longer exists or is severely damaged, then that will be enough to terminate the agency.
subagent
A person upon whom the powers of an agent have been conferred, not by the principal, but by an agent as authorized by the agent's principal.
ostensible agency
A person who has been given the appearance of being an employee or acting (an agent) for another (principal), which would make anyone dealing with the ostensible agent reasonably believe he/she was an employee or agent.
implied agency
Agency that exists as a result of actions of the parties.
express agency
An agency relationship created by oral or written agreement between principal and the agent.
single agent
An agent who works only for the buyer or the seller.
general agent
An agent with full authority over one property of the principal, such as a property manager.
special agent
An agent with limited authority to act on behalf of the principal, such as created by a listing contract.
commission
An agent's compensation for performing the duties of agency; in real estate practice, a percentage of the selling price of property, percentage of rentals, etc. A fee for services. once the agent has found a "ready, willing and able buyer."
breach of contract
If the party who wants to terminate the relationship can show that the other party has breached the terms of the contract, then they can have the relationship brought to a close.
agent
One who acts for and with authority from another called the principal.
operation of law
Perhaps a property is seized as a tax asset by the IRS. In those instances, any agency relationship regarding that property will be nullified.
Dual Agency
Representing both parties to a transaction. This is unethical unless both parties agree to it, and it is illegal in many states
Fiduciary Duty
That duty owed by an agent to act in the highest good faith toward the principal and not to obtain any advantage over the latter by the slightest misrepresentation, concealment, duress or pressure.
Universal Agent
The agent who has complete authority over any activity of the principal; for example, power of attorney.
principle
The employer of an agent, such as a buyer or seller.
agency
The relationship between principal and the principal's agent, which arises out of a contract, either expressed or implied, written or oral, wherein the agent is employed by the principal to do certain acts dealing with a third party.
third party
customer
death or incapacity of either party
ends agency
expiration of listing contract
ends agency on date
listing contract
establishes an express agency relationship because it lays out what the broker, as a special agent, will do for the seller. All of the agent's responsibilities and expectations in representing the principal will be clearly stated, and the monetary compensation that the principal will owe the agent upon successful completion of a sale is stated. There will also be an end date to a listing agreement which would cause a termination of the agency relationship unless there is a sale or extension, and there may be additional conditional reasons that would terminate the relationship included in the listing.
mutual agreement
if both parties agree, they can officially terminate the agency.
Full Performance
very best way to end an agency relationship is with full performance or completion of the transaction. Once the closing is completed and the job was well done, then the house has been sold (or bought), the apartment rented or the commercial space leased and you've been paid the commission. The agency relationship is over and everyone walks away happy.
