Texas Law of Agency: Quiz Questions

Which of the following is an example of a termination of agency by the actions of the parties...? Execution of the contract A breach of contract by the agent or principal Expiration of the contract Bankruptcy

A Breach of Contract by the Agent or Principal

In order to earn a commission, a broker must secure which of the following...? A letter of intent from a buyer An interested buyer An offer from a buyer A ready, willing, and able buyer

A Ready, Willing and Able Buyer

Which of the following can legally employ a real estate salesperson to work on their behalf...? An associate broker A real estate broker Another real estate salesperson A real estate associate

A Real Estate Broker

If an individual works as an associate broker, who must they work under...? An associate licensee An associate broker does not work under anyone A real estate salesperson A sponsoring broker

A Sponsoring Broker

This type of agency may exist before a listing contract is signed between a broker and seller...? Partial agency Substantial agency Express agency Agency by estoppel

Agency by Estoppel

An agency 'after the fact' is also known as a...? Agency by ratification Express agency Implied agency Gratuitous agency

Agency by Ratification

One who acts for and with authority from another, called the principal, is known as a/an...? Agent Attorney Employee Partner

Agent

Alex is a real estate salesperson who recently signed a buyer representation agreement with a buyer; however, Alex decided to leave his broker for a new broker. Who owns Alex's buyer representation agreement...? Alex only Alex and his new sponsoring broker Alex's original sponsoring broker Alex's new sponsoring broker

Alex's Original Sponsoring Broker

A broker must disclose which of the following to their principal...? If the broker is receiving an additional commission from another party How the commission is being split with other brokers The broker's opinion of value All of the above

All of the Above

A buyer's agent should not provide which of the following services to the principal...? Legal services Appraisal services Financial services All of the above

All of the Above

A real estate broker may sponsor which of the following...? Associate licensee Real estate salesperson Associate broker All of the above

All of the Above

Bob is a broker serving as an intermediary in a transaction. He decides to appoint two of his associate licensees to represent the seller and buyer. The associate licensees are prohibited from which of the following actions...? Disclosing confidential information about either party Disclosing to the seller that the buyer is willing to pay more than the asking price Disclosing to the buyer that the seller will accept an offer below the asking price All of the above

All of the Above

If an associate licensee is assigned to represent the seller in an intermediary agency transaction, what fiduciary duties does the licensee owe to the seller...? Reasonable skill and diligence Loyalty Confidentiality All of the above

All of the Above

Joe entered into an agency agreement with a buyer. How may Joe's agreement be terminated...? Expiration of the contract The buyer rescinds the contract Fulfillment of the duties by both parties All of the above

All of the Above

Town Brokers are developing a company policies and procedures manual. What should be included in the manual...? Matters regarding the competency of agents Matters regarding advertising rules Matters regarding continuing education All of the above

All of the Above

Which of the following fiduciary duties are owed by a broker to a buyer after signing an exclusive buyer representation agreement...? Loyalty Confidentiality Full disclosure All of the above

All of the Above

Which of the following is considered a physical stigma for a property...? Lead-based paint Asbestos Ground water contamination All of the above

All of the Above

Which of the following must be included in a buyer representation agreement...? The client's duties The broker's duties The term of the contract All of the above

All of the Above

Which of the following parties may serve as the principal in a transaction...? Seller Landlord Buyer All of the above

All of the Above

Agency agreements may not have which of the following...? A stated commission A termination date An automatic renewal clause Any of the above

An Automatic Renewal Clause

This is a protected class under the Texas Fair Housing Act, which is not protected under the Federal Fair Housing Act...? Ancestry Financial status Age All of the above

Ancestry

Which of the following parties must sign the Independent Contractor Agreement For Sales Associate form...? Both the broker and seller The agent only Both the broker and agent The broker only

Both the Broker and Agent

Which of the following parties must sign the Intermediary Relationship Notice...? The seller and their broker Both the buyer and seller The buyer only The seller only

Both the Buyer and Seller

Which of the following is considered a reasonable accommodation under the ADA...? Widening all of the corridors on the first floor of a building Adding an elevator to a building Building a ramp at the entrance of a building All of the above

Building a Ramp at the Entrance of a Building

Fraud in the real estate industry is covered in which of the following statutes...? Uniform Commercial Code Business and Commerce Code Texas Fair Housing Act Texas Constitution

Business and Commerce Code

What is the fifth step in developing a broker's company policies and procedures manual...? Conduct in-house training sessions and monitor the effectiveness of the manual Write the company policy manual Review the various agency relationships Review the size and experience of the broker's office staff

Conduct In-House Training Sessions and Monitor the Effectiveness of the Manual

According to this fiduciary duty, an agent must keep confidential any information that may weaken the principal's bargaining position...? Reasonable care Loyalty Confidentiality Obedience

Confidentiality

Which of the following duties does an agent owe to the principal after the agency agreement is terminated...? Obedience Confidentiality Full disclosure All of the above

Confidentiality

Prior to signing a buyer representation agreement, the buyer operates as a/an .............to the broker? Employer Principal Customer Client

Customer

The party the agent brings to the principal as a seller or buyer of the property is known as a/an...? Partner Customer Associate Client

Customer

Which of the following prohibits discrimination of protected classes in the lending process...? Equal Credit Opportunity Act Community Reinvestment Act Truth-in-Lending Act Real Estate Settlement Procedures Act

Equal Credit Opportunity Act

Which of the following creates an exclusive agency relationship between a buyer and a broker...? Exclusive right to sell agreement Exclusive right to purchase agreement Net listing agreement Open buyer agency agreement

Exclusive Right to Purchase Agreement

A listing contract given to only one broker who is entitled to the commission if anyone sells the property during the term of the listing contract is known as a/an...? Exclusive Right to Sell Agreement Net Listing Open Listing Exclusive Agency Agreement

Exclusive Right to Sell Agreement

Which of the following listing agreements offers the most amount of protection for the broker...? Open Listing Net Listing Exclusive Agency Agreement Exclusive Right to Sell Agreement

Exclusive Right to Sell Agreement

What type of agency is typically used in a real estate transaction...? Express agency Implied agency Agency by estoppel Agency by ratification

Express Agency

Which of the following laws takes precedent over all other laws...? Federal law Local law State law County law

Federal Law

An agent who represents a client owes ..........to that client? Common duties Fiduciary duties Accounting duties Legal duties

Fiduciary Duties

Abraham was assigned to represent a buyer in an intermediary brokerage. What fiduciary duties does Abraham owe to the seller...? Honesty Loyalty Accountability Obedience

Honesty

When is written consent not needed for a broker to act as an intermediary...? If a buyer representation agreement is signed with the buyer If representation agreements are signed with both the buyer and seller, which allows the broker to act as an intermediary If the purchase contract grants permission to the broker If a listing contract is signed with the seller

If Representation Agreements are Signed with Both the Buyer and Seller, Which Allows the Broker to Act as an Intermediary

A broker who serves as an intermediary must act fairly and...? Partially Impartially Biased Reasonably

Impartially

Agency that exists as a result of the actions of the parties is known as...? Partial agency Implied agency Express agency Substantial agency

Implied Agency

A buyer representation agreement needs to be ............in order for the broker to earn a commission? Recorded In writing Orally created Implied

In Writing

A listing contract between a seller and broker must be...? Recorded In writing Oral All of the above

In Writing

A real estate salesperson operates as a/an...? Employer Independent contractor Customer Consultant

Independent Contractor

Prior to entering into an agency relationship, a buyer's broker must present the buyer with which of the following forms...? Information About Brokerage Services Listing Agreement Standard Fee Agreement Seller's Disclosure Form

Information About Brokerage Services

If a broker represents both the seller and buyer, the broker is acting as a/an...? Partial agent Net agent Single agent Intermediary

Intermediary

Which of the following was prohibited from being used after 1978...? Asbestos Lead-based paint Wool insulation Oil-based paint

Lead-Based Paint

Statutory law is derived from which of the following...? Court decisions Legislation Judge rulings Common actions

Legislation

Agency between a broker and principal is created through a/an...? Listing contract Purchase contract Independent contractor agreement Any of the above

Listing Contract

This is an agent's duty to place their client's interest above those of all others, including the agent's own self-interest...? Confidentiality Loyalty Accountability Obedience

Loyalty

Any fact that would influence the decision of a reasonably prudent person is known as a/an...? Implied fact Material fact Constructive fact Impartial fact

Material Fact

A dispute that arises out of a buyer representation agreement must be resolved first through...? Mediation Litigation Arbitration Civil lawsuit

Mediation

What is typically needed to create an agency relationship...? An implied action by one of the parties A recorded contract Mutual agreement between the parties An agreement by only one of the parties

Mutual Agreement Between the Parties

Which of the following is a protected class under the Federal Fair Housing Act...? National origin Occupation Financial status All of the above

National Origin

An open listing contract is an example of a/an...? Non-exclusive listing contract Exclusive contract Purchase contract Net listing contract

Non-Exclusive Listing Contract

This is a fiduciary relationship that obligates the agent to act in good faith at all times, obeying the client's instructions in accordance with the contract? Loyalty Accountability Confidentiality Obedience

Obedience

Which of the following listing contracts offers the least amount of protection to the broker...? Exclusive Agency Agreement Open Listing Exclusive Right to Sell Agreement Net Listing

Open Listing

An attorney provides which of the following, which is based on a property's abstract of title...? Opinion of title Official title Title plan Survey of title

Opinion of Title

Title insurance consists of a contract between an insurance company and a/an...? Agent Seller Broker Policy holder

Policy Holder

The Information About Brokerage Services form is presented by the broker to the...? Associate agent Escrow agent Agent Prospective client

Prospective Client

Under the DTPA, an agent who is found guilty of misrepresentation may be required to pay which of the following...? Common damages Substantial damages Punitive damages Partial damages

Punitive Damages

A listing contract is signed between a principal and a...? Real estate broker Any of the above Real estate salesperson Associate licensee

Real Estate Broker

Which of the following has the highest authority in an agency relationship...? Real estate salesperson Real estate broker Associate licensee Associate broker

Real Estate Broker

An agent owes which of the following fiduciary duties to a customer...? Loyalty Reasonable care Obedience An agent never owes fiduciary duties to a customer

Reasonable Care

According to this fiduciary duty, an agent must meet deadlines set by the principal and/or client...? Obedience Loyalty Confidentiality Reasonable care and diligence

Reasonable Care and Diligence

Residential Realty recently started to develop a new policies and procedures manual. What is the second step they need to take in developing the manual...? Review the size and experience of the broker's office staff Review the various agency relationships Review the advantages and disadvantages of each agency relationship Write the company policy manual

Review the Advantages and Disadvantages of Each Agency Relationship

What is the second step in developing a broker's company policies and procedures manual...? Review the size and experience of the broker's office staff Write the company policy manual Review the various agency relationships Review the advantages and disadvantages of each agency relationship

Review the Advantages and Disadvantages of Each Agency Relationship

What is the third step in developing a broker's company policies and procedures manual...? Write the company policy manual Review the various agency relationships Review the size and experience of the broker's office staff Review the advantages and disadvantages of each agency relationship

Review the Size and Experience of the Broker's Office Staff

What is the first step in developing a broker's company policies and procedures manual...? Review the advantages and disadvantages of each agency relationship Write the company policy manual Review the size and experience of the broker's office staff Review the various agency relationships

Review the Various Agency Relationships

The Texas Property Code requires which of the following in a residential transaction...? Seller's Disclosure of Property Condition Commission Disclosure Form Information About Brokerage Services form All of the above

Seller's Disclosure of Property Condition

A buyer representation agreement between a buyer and broker creates what type of agency...? General agency Special agency Specific agency Universal agency

Special Agency

A listing contract creates what type of agency...? Universal agency General agency Specific agency Special agency

Special Agency

Which of the following is the most restrictive type of agency...? Special agency General agency Specific agency Universal agency

Special Agency

An agent with limited authority to act on behalf of the principal is known as a...? General agent Specific agent Special agent Universal agent

Special Agent

Paragraph 17 of the Residential Buyer/Tenant Representation Agreement lists which of the following...? Confidential information Attorney's fees Broker's fees Special provisions

Special Provisions

Sam is a real estate broker who is bringing a buyer to a transaction. If Sam did not sign a buyer representation agreement with the buyer, he will serve as a .............to the seller's broker? Sub-agent Customer Client Broker

Sub-Agent

This is a document which precisely shows the property lines, and size and location of improvements on a particular property...? Topographic map Survey Abstract Roof plan

Survey

Which of the following federal laws requires lenders to disclose to borrowers the actual cost of obtaining a loan...? Fair Housing Act ADA Sherman Anti-Trust Act TILA

TILA

According to the Independent Contractor Agreement For Sales Associate, the salesperson is a member of which associations...? Texas Institute of Realtors Texas Bureau of Real Estate Texas Association of Realtors All of the above

Texas Association of Realtors

Which of the following must be satisfied in order for an agent to receive a commission from a transaction...? The agent must have held a valid real estate license prior to the start of the transaction The transaction must close The seller must receive a profit from the transaction, which can be used to pay the broker commission All of the above

The Agent Must Have Held a Valid Real Estate License Prior to the Start of the Transaction

Which of the following is an advantage to working as an intermediary...? The broker takes on more liability The broker increases the risk of a conflict of interest The broker can earn a higher commission The broker can only offer limited assistance to each party

The Broker Can Earn a Higher Commission

If a broker acting as an intermediary assigns licensees to represent both the buyer and seller, who becomes responsible for the agency relationships...? The buyer and seller The licensee representing the seller The licensee representing the buyer The broker is always responsible for the actions of the licensees

The Broker is Always Responsible for the Actions of the Licensees

What must a listing broker disclose at their first substantial dialogue with a prospective buyer...? The lowest price the seller is willing to accept The broker's agency relationship with the seller The seller's motives for selling All of the above

The Broker's Agency Relationship with the Seller

Which of the following parties primarily benefits from an agency by estoppel...? The principal The broker The customer The agent

The Customer

This document explains to the customer the services offered by the brokerage...? Brokerage Services Disclosure The Information About Brokerage Services Agency Disclosure Form Listing Contract

The Information About Brokerage Services

What is the minimum standard of conduct for a real estate professional...? The law The TAR code of ethics The NAR code of ethics The TAC cannons of ethics

The Law

A real estate broker works for which of the following in a transaction...? The customer The lender The principal All of the above

The Principal

According to the Independent Contractor Agreement For Sales Associate, how often is a salesperson required to be present in the broker's office...? 10 hours a week minimum 20 hours a week minimum 40 hours a week minimum The salesperson is not required to be present in the broker's office

The Salesperson is Not Required to be Present in the Broker's Office

Who pays a real estate salesperson their commission for a transaction...? The salesperson's sponsoring broker The seller The buyer Any of the above

The Salesperson's Sponsoring Broker

Sam recently entered into a buyer representation agreement with a buyer. Which of the following is a third party to the agreement...? Sam The seller The buyer All of the above

The Seller

Who is responsible for completing the Seller's Disclosure of Property Condition form...? The seller's attorney The buyer The seller The seller's broker

The Seller

Tim is a real estate salesperson who's broker is serving as an intermediary in a transaction. Tim was assigned by his broker to represent the seller in the transaction, while another licensee in the office represented the buyer. Tim is allowed to give advice to which of the following parties...? Both the seller and buyer The seller only Tim is never allowed to give advice if his broker is serving as an intermediary The buyer

The Seller Only

Which of the following is a possible red flag from a seller...? The seller refuses to disclose certain information on the Sellers Disclosure form The seller refuses to let buyers know their reason for selling The seller refuses to reveal the lowest offer they are willing to accept All of the above

The Seller Refuses to Disclose Certain Information on the Sellers Disclosure Form

Matthew signed an independent contractor agreement with his broker. What is the standard term used in the agreement...? 12 months 24 months 36 months There is no standard term

There is No Standard Term

David is serving as a power of attorney for Sarah. David is serving as what type of agent...? Universal agent General agent Specific agent Special agent

Universal Agent

City Realty recently started to develop a new policies and procedures manual. What is the fourth step they need to take in developing the manual...? Review the size and experience of the broker's office staff Write the company policy manual Review the advantages and disadvantages of each agency relationship Review the various agency relationships

Write the Company Policy Manual

What is the fourth step in developing a broker's company policies and procedures manual...? Review the advantages and disadvantages of each agency relationship Review the size and experience of the broker's office staff Review the various agency relationships Write the company policy manual

Write the Company Policy Manual

TRELA allows a broker to act as an intermediary if which of the following is provided...? Implied consent from all parties Written consent from all parties Partial consent from all parties Oral consent from all parties

Written Consent from all Parties

Which of the following is needed in order to allow a broker to appoint associate licensees to represent the seller and buyer in an intermediary brokerage...? Implied consent from all parties Partial consent from all parties Oral consent from all parties Written consent from all parties

Written Consent from all Parties

A real estate salesperson must obtain which of the following to cancel or terminate a brokerage service agreement...? A real estate salesperson does not need anything to terminate a brokerage service agreement Oral permission from the broker A real estate salesperson can never terminate a brokerage service agreement Written permission from the broker

Written Permission from the Broker