Ch. 4: Fiduciary Duties

Which of the following is an example of commingling? A. A license holder using a principal's funds for an approved marketing decision. B. A broker collecting a commission upon completion of a sale. C. A license holder interacting with third parties without disclosing representation. D. An agent storing a principal's title fee funds in the agent's personal bank account.

D.

accounting (OLD CAR)

an agent's duty to account for all funds and/or property a client has entrusted to them during their agency relationship one of the fiduciary duties an agent owes the principal that extends beyond termination of the agency relationship

loyalty (OLD CAR)

an agent's duty to put the client's interests first, including over those of the agent one of the fiduciary duties an agent owes the principal

disclosure (OLD CAR)

the act of revealing critical information regarding agency relationships or material facts related to real estate transactions, sometimes as a matter of law one of the fiduciary duties an agent owes to the principal

fiduciary duties

the full sum of obligations owed to the client in an agency relationship that ensure that the agent always acts in the best interest of the client; includes the duties of obedience, loyalty, disclosure, confidentiality, accounting, and reasonable care

reasonable care (OLD CAR)

the level of care and competency expected of license holders one of the fiduciary duties an agent owes the principal

obedience (OLD CAR)

the obligation of an agent to carry out the legal and ethical instructions of their client one of the fiduciary duties an agent owes the principal The duty of obedience does not apply, however, if the principal's instructions are illegal or unethical in any way.

confidentiality (OLD CAR)

the obligation of an agent to safeguard the private information of their client one of the fiduciary duties an agent owes the principal that extends beyond termination of the agency relationship