NC Superior Real Estate School - Chapter 7 Exam with correct Answers

NC Superior Real Estate School - Chapter 7 Exam with correct Answers Chapter 7 Vocabulary: Brokerage Relationships - Laws & Practices -Answer-Chapter 7 Vocabulary: Brokerage Relationships - Laws & Practices Agent -Answer-A person authorized by another to act on his or her behalf Subagents of a firm (in which listing agreement goes through) Apparent Authority -Answer-A fact situation that crates the appearance of an agent's authority. Breach of Duty -Answer-The failure to fulfill an agent's duty to his or her principal. This includes disloyalty; disobedience; lack of skill, care, and diligence; and failure to other properly disclose information or to accurately account for funds. Buyer Agency Agreement -Answer-A contract in which a buyer engages an agent to act on the buyers's behalf in purchasing new property. Caveat Emptor -Answer-Latin for "let the buyer beware." Civil Penalty -Answer-Payment or redress for a private civil wrong imposed by a civil, not criminal, proceeding. Client -Answer-The principal, to whom the agent owes fiduciary duties. Customer -Answer-The "third party" in a transaction; the agent works with the customer but not for him. Disclosure of Information -Answer-The prompt and total communication to the principal by the agent of any information that is material to the transaction for which the agency was created. Dual Agency Agreement -Answer-Dual Agency - Representing two parties at the same time or in the same transaction. This practice is illegal unless all parties are properly informed and consent to the agency. Employment Authority -Answer-A document or contract giving a real estate agent the right to act for a principal with certain specific guidelines in a real estate contract (i.e., a listing contract or a buyer's agency contract) Estoppel -Answer-The prevention of a person from making a statement contrary to a previous statement. Express Agency -Answer-Any oral or written agreement establishing a trust relationship between a principal and agent. Express Authority -Answer-That authority specifically granted in a contract. Fiduciary -Answer-A person, such as an agent, who is placed in a position of trust in relation to the person for whose benefit the relationship is created. Essential same as a trustee. Foundation of Professionalism - OLD CAR Obedience Loyalty Disclosure Confidential Accounting Reasonable Skill & Care Your clients expect & the law demands you protect & promote their interests (their adventure) First Substantial Contact -Answer-A flexible standard that typically occurs when an agent and a prospective buyer discuss in any detail the buyer's interstate's in purchasing property. General Agency -Answer-Full authority over one particular filed of business or aspect of personal affairs of the principal (e.g., a property manager managing and apartment complex for the owner. Loyalty -Answer-An absolute duty of an agent to a principal to serve the best interest of the principal. (alternate definition later in cards) Misdemeanor -Answer-A criminal violation punishable by a fine and/or imprisonment. It is not considered as severe an offense as a felony. Negligent Misrepresentation -Answer-An unintended misrepresentation of a material fact that the party did not make knowingly but should have known the truth by exercising due skill, care, and diligence. Negligent Omission -Answer-An unintended failure to communicate a known material fact. An unintended failure to communicate unknown material fact by a person responsible for disclosing it because this person did not exercise the due skill, care, and diligence that would have revealed the fact. Omission -Answer-The failure to disclose information. Not saying anything at all Principal -Answer-(A) In the law of agency, one who appoints an agent to reprint him/her. (B) The amount of money on which interest is either owed or received. Special Agency -Answer-Limited authority to act on behalf f the principal, such as created by a listing. Special Agent - One who is limited to a very narrow duty on behalf of his or her principal, e.g., as a real estate agent to find a buyer. Subagent -Answer-A person appointed by an agent to assist in performing some or all of the tasks of the agency. Tenant Agency -Answer- Third Party -Answer-The person or party in a transaction other than the principal and his or her agent. In a subagency relationship, the buyer is a third party; in a buyer's agency relationship, the seller is the third party. Universal Agency -Answer-Complete authority over all activity of the principal. May be created by an unlimited power of attorney. Willful Misrepresentation -Answer-A deliberate false statement concerning a material fact by one who knows the true fact and is responsible for d