Agency Relationships and Employment Contracts

Questions and Answers

Agency relationships are created under which of the following concepts?

Express agency

Implied agency

Ostensible agency

All of the above (correct)

The employment contract between the broker and affiliated licensees should include:

The employment relationship

The authority being given to the licensee

All responsibilities and duties of the licensee

All of the above (correct)

An agency relationship is NOT terminated:

When the parties agree

By mutual consent

Once a suit for specific performance is instituted (correct)

Upon the death of the agent

Which is FALSE regarding agency?

Licensing by the state makes a person an agent in the legal sense Signup and view all the answers

California Civil Code 2079 does NOT require:

Agency disclosure forms in raw land transactions Signup and view all the answers

In addition to compliance with the terms of an agency agreement, the agent:

All of the above Signup and view all the answers

Which one of the following is TRUE about a California salesperson?

A salesperson is the agent of the broker and a subagent of the client Signup and view all the answers

Which one of the following is TRUE about a California real estate broker?

A broker should establish a policy and procedures manual Signup and view all the answers

Which one of the following is FALSE regarding dual agency?

Dual agency does not require written disclosure Signup and view all the answers

An exclusive agency listing can best be described as:

A listing agreement between a seller and broker wherein the seller agrees to pay a commission to the listing broker unless the seller finds the buyer. Signup and view all the answers

Study Notes

Agency Relationships

Agency relationships can be established through various methods: express agency, implied agency, ostensible agency, agency by estoppel, agency by ratification, and agency by necessity.

Employment Contracts

Employment contracts between brokers and affiliated licensees must clearly define all responsibilities, duties, and authority granted to the licensee in both office and field settings.

Termination of Agency Relationships

An agency relationship is not automatically terminated when a suit for specific performance is initiated, as these relationships are personal service contracts.

Misconceptions of Agency Terms

Terms like agent, broker, salesperson, and REALTOR® are not synonymous. A REALTOR® is a member of the National Association of REALTORS®, while legal agency status is not guaranteed by state licensing or REALTOR® membership.

California Civil Code 2079

California Civil Code 2079 mandates agency disclosure forms for certain transactions but does not require them for raw land and business opportunity transactions.

Agent Responsibilities

Agents must comply with agency agreements, provide principals with opportunities for independent advice, disclose all relevant facts, and adhere to fiduciary responsibilities, ensuring good faith and avoiding conflicts of interest.

California Salesperson Agency

A California salesperson acts as an agent of the broker and also as a subagent of the client, representing dual agency relationships.

Broker Responsibilities

California brokers are required to establish a Policy and Procedure Manual and must actively supervise their agents, who can be employees or independent contractors.

Dual Agency Requirements

Any agency relationship, including dual agency, mandates written disclosure of the agency relationships, contrary to the belief that verbal explanation suffices.

Exclusive Agency Listing

An exclusive agency listing is a contract wherein the seller agrees to pay a commission to the broker unless they find the buyer themselves. While it grants exclusive marketing rights to one broker, it allows the seller to sell independently without owing a commission to the broker.

Description

Explore the nuances of agency relationships, including various methods of establishment such as express and implied agency. Understand the critical elements of employment contracts in real estate and the implications of California Civil Code 2079. Test your knowledge on misconceptions surrounding agency terminology and termination criteria.