Module A - Agency and Property Disclosure

Broker-In-Charge & Dual Agency

"The team may act as disclosed dual agents only and with the prior informed and written consent of all parties and as addressed in the broker-in-charge's written office policy."

Subagency

A licensee joins the agency relationship already established between another licensee and his/her principal.

Intermediary

A licensee who assists one or more parties throughout a contemplated real estate transaction with communication, contract terms, forms, or the closing of the real estate transaction without being an agent or advocate for any party to the transaction.

Open listings are

A property might be listed with several or many different brokers The broker who brought the successful offer and closed the transaction received the entire commission. The other brokers received nothing.

Once the substantive contact has been verbally confirmed, then the agent shall present an _________________________ form to the new client in person or by electronic means (e.g., email, internet).

Acknowledgement of Receipt of Disclosure of Brokerage Relationship

An agency relationship that is created after the principal agrees to be bound by the actions of another person who was acting without authority is known as a(n)_______________________________

Agency by Ratification

Express Agency

An actual agency created by the written or spoken words of the principal authorizing the agent to act.

Agency by Estoppel

An agency that is not created as an actual agency by a principal and an agent but that is imposed by law when the principal acts in such a way as to lead a third party to reasonably believe that another is the principal agent and the third party is injured by relying on and acting by that belief.

Exclusive Buyer Agents (EBA) in South Carolina

Buyers who prefer working with Exclusive Buyer Agents may likely first focus on finding licensees who will represent their buyer needs and interests, first and foremost.

Which of these is a fiduciary responsibility?

Confidentiality Obedience Loyalty All of the above

Consider what the main obligations of a buyer's agent are:

Helping the buyer find the best possible property Helping the buyer purchase the property at the best possible price (even if it ends up being full price or more) Helping advise the buyer about, and protect the buyer from, problems with the property.

Exclusive right to sell listings

In this case, the broker was entitled to a commission in the event of a sale no matter who procured the buyer, even the seller.

Which of the following would a broker, acting as agent for a seller, NOT be expected to do?

Investigate and discover material facts

Protection Clause

Most real estate brokerages include a protection clause in agency agreements to protect the broker after the expiration of the agency agreement.

OLDCAR

Obedience Loyalty Disclosure Confidentiality Accounting Reasonable Care

Fiduciary

One often in a position of authority who obligates himself or herself to act on behalf of another (as in managing money or property) and assumes a duty to act in good faith and with care, candor, and loyalty in fulfilling the obligation.

A doctrine in tort law that makes a master liable for the wrong of a servant is called:

Respondent Superior

Agent

Someone or something that acts or exerts power; a moving force in achieving some result.

The degree of care or competence that one is expected to exercise in a particular circumstance or role is:

Standard of Care

The critical difference in tort liability between the average person and skilled professionals is known as:

Standard of care

Buyer agency

The agent represents only the buyer in a transaction.

Seller agency

The agent represents the seller only; the buyer is a customer.

An agent should always obey the instructions of their client, unless:

The instructions are illegal

Which of these is NOT one of the traditional common law agency duties?

Timeliness

Tort Liability: Negligence and Fraud

Tort law is a group of laws that address and provide remedies for civil wrongs not arising out of contractual obligations. Tort covers accidents and acts that are intentional.

Traditional Common Law Agency Duties

can be remembered by the acronym of COALD; COALD stands for Care, Obedience, Accounting, Loyalty, and Disclosure.

Common Law

dates back to judicial or court decisions in Old England several centuries ago.

Agency by Ratification

is an agency relationship that is created because the principal approved of an agents unauthorized action after the action occurred.

Implied Agency

may occur unwittingly or unknowingly. It arises from actions, not words.

The National Association of Exclusive Buyer Agents (NAEBA)

was founded in 1995 to protect the interests of the real estate buyer.

Misconceptions about the Creation of Agency

Misconception Number One: The agent who is showing you a property automatically represents you. Misconception Number Two: In order to create an agency relationship, a client must provide immediate compensation. Misconception Number Three: The party who pays the fees determines agency relationships.

The obligation to follow the principal's lawful instructions falls under the duty of:

Obedience

Broker-in-Charge

This licensee is the top person in a brokerage firm office in South Carolina. It is the broker-in-charge who hires the agents (brokers and salespersons) who work under his or her license.

Single agency

The agent represents one party only; either the buyer or the seller.

Constructive notice

can be described as "giving notice without giving notice." Instead of delivering written or oral notice of some fact to a person, the person giving notice could post it on a public bulletin board or put the notice in a periodical with a large circulation in the area.

South Carolina Code §40-57-137(M)(1)

states that a real estate licensee can act as a disclosed dual agent only with the prior informed and written consent of all parties.

Implied Knowledge

"In the law of agency, notice of facts brought to the attention of an agent (a person authorized by another, known as a principal, to act for him or her), within the scope of the agent's authority or employment, is usually imputed to his or her principal.

Fiduciary comes from the Latin word "fides" which means:

"Trust"

In South Carolina and many other states, the term _________________ is critically important regarding how and when an agent is required to confirm their potential agency relationship with their prospect or client.

"substantive contact"

Section 40-57-350(L)

A real estate brokerage firm may offer transaction brokerage to potential buyers and sellers. A transaction broker may be a single agent of a party in a transaction, giving the other party customer service or the transaction broker may facilitate the transaction without representing either party.

Fiduciary Relationship

A relationship in which one party places special trust, confidence, and reliance in and is influenced by another who has a fiduciary duty to act for the benefit of the party.

A(n) _________ may be generally defined as someone who represents another in dealings with third parties.

Agent

Disclosure laws require that an agent must make a full disclosure, in a timely fashion, of all known facts that are "material" to the transaction. Material:

Of, relating to, or consisting of physical matter Being of real importance or consequence Being an essential component Being relevant to a subject under consideration Being such would affect or be taken into consideration by a reasonable person in acting or making a decision

Dual agency

The agent represents both the buyer and the seller in the same transaction and owes fiduciary duties to both. This form of agency is not available in some states. Be sure to check your own state laws before entering into a dual agency relationship.

General Agency

The agent represents the principal in a variety of matters related to a particular business.

Exclusive agency listings

This meant that, in the event of a sale to a buyer procured by the listing agent or any other broker, the listing agency would be entitled to a commission. However, the owner could still sell the property directly to a purchaser and no commission would be due.