Law of Agency - Champions School of Real
Estate, Exam: Law of Agency – Champions
ACTUAL QUESTIONS AND CORRECT
ANSWERS
The principal is also known as - CORRECT ANSWERS✅✅client
fiduciary relationship - CORRECT ANSWERS✅✅a relationship founded on trust and
confidence
Agency Relationship - CORRECT ANSWERS✅✅Exists when one person (the agent) acts
for, or on
behalf of another person (the principal).
the principal - CORRECT ANSWERS✅✅is the one who hires and gives authority to the
agent
Texas Real Estate License Act TRELA - CORRECT ANSWERS✅✅Was passed 1939. The
purpose is to protect the public against unscrupulous brokers and sales agents.
Texas Real Estate Commission TREC - CORRECT ANSWERS✅✅Was created to enforce
and administer TRELA in 1949. The purpose of this act is to protect the public against
unscrupulous brokers and sales agents.
A licensed broker may not pay a commission to or otherwise compensate a person directly or
indirectly for performing an act of a broker unless the person is... - CORRECT
ANSWERS✅✅a license holder or a real estate broker licensed in another state
TRELA may suspend or revoke a license or take other disciplinary action if the license
holder, while engaged in real estate brokerage engages in... - CORRECT
ANSWERS✅✅conduct that is dishonest or in bad faith or that demonstrates
untrustworthiness
,a broker works FOR - CORRECT ANSWERS✅✅a client
a broker works WITH - CORRECT ANSWERS✅✅a customer
how does a buyer become a client - CORRECT ANSWERS✅✅by entering into a buyer
representation agreement with the broker
Subagent - CORRECT ANSWERS✅✅A license holder not associated with the seller's
broker, but who is representing the seller through a cooperative agreement, often through
membership in a Multiple Listing Service (MLS), with the seller's broker.
An agency relationship exists when one person, the _____ acts for, or on behalf of another
person, the ______ - CORRECT ANSWERS✅✅agent, principal
which of the following is grounds for suspension or revocation of license by TREC? -
CORRECT ANSWERS✅✅splitting commission with a person other than a license holder
The commission can deny licensure to an applicant based on the applicant's
_______________________ - CORRECT ANSWERS✅✅moral character
Ostensible Agency - CORRECT ANSWERS✅✅exists when actions lead another person to
assume that one is an agent.
Agency by Ratification - CORRECT ANSWERS✅✅Occurs when an agent acts without
prior authorization, and the principal, upon learning of this action, accepts it.
agency coupled with an interest - CORRECT ANSWERS✅✅When a broker is the owner of
a property that is being sold, or when a broker is interested in buying a property, we have
agency coupled with an interest
Agency Authority - CORRECT ANSWERS✅✅or rights, may also be a result of "the norm",
or what is considered customary in the business
, Implied Authority - CORRECT ANSWERS✅✅an agent's authority to do things not
specifically authorized in order to carry out express authority
Fiduciaries - CORRECT ANSWERS✅✅are held to the highest amount of good faith, are
required to exclude all selfish interest, are prohibited from putting themselves in positions
where personal interest and representative interest will conflict and must, in any direct
dealing with the principal, make full disclosure of all relevant facts and give the latter an
opportunity to obtain independent advice
General Agent - CORRECT ANSWERS✅✅has less authority than the universal agent. Has
the right to represent his or her principal in a particular type of transaction or business. One
common example of a general agent in real estate is the property manager.
As agents, our fiduciary duties and responsibilities include - CORRECT
ANSWERS✅✅OLD CAR
Obedience
Loyalty
Disclosure
Confidentiality
Accounting
Reasonable care
Obedience - CORRECT ANSWERS✅✅an agent is obligated to follow all o the lawful
instructions of a client
The commission may suspend or revoke a license or take other disciplinary action if the
license holder, while acting as a broker or sale agent... - CORRECT
ANSWERS✅✅commingles money that belongs to another person with the license holders
own money
The disclosure of representation may be done - CORRECT ANSWERS✅✅orally or in
writing
Estate, Exam: Law of Agency – Champions
ACTUAL QUESTIONS AND CORRECT
ANSWERS
The principal is also known as - CORRECT ANSWERS✅✅client
fiduciary relationship - CORRECT ANSWERS✅✅a relationship founded on trust and
confidence
Agency Relationship - CORRECT ANSWERS✅✅Exists when one person (the agent) acts
for, or on
behalf of another person (the principal).
the principal - CORRECT ANSWERS✅✅is the one who hires and gives authority to the
agent
Texas Real Estate License Act TRELA - CORRECT ANSWERS✅✅Was passed 1939. The
purpose is to protect the public against unscrupulous brokers and sales agents.
Texas Real Estate Commission TREC - CORRECT ANSWERS✅✅Was created to enforce
and administer TRELA in 1949. The purpose of this act is to protect the public against
unscrupulous brokers and sales agents.
A licensed broker may not pay a commission to or otherwise compensate a person directly or
indirectly for performing an act of a broker unless the person is... - CORRECT
ANSWERS✅✅a license holder or a real estate broker licensed in another state
TRELA may suspend or revoke a license or take other disciplinary action if the license
holder, while engaged in real estate brokerage engages in... - CORRECT
ANSWERS✅✅conduct that is dishonest or in bad faith or that demonstrates
untrustworthiness
,a broker works FOR - CORRECT ANSWERS✅✅a client
a broker works WITH - CORRECT ANSWERS✅✅a customer
how does a buyer become a client - CORRECT ANSWERS✅✅by entering into a buyer
representation agreement with the broker
Subagent - CORRECT ANSWERS✅✅A license holder not associated with the seller's
broker, but who is representing the seller through a cooperative agreement, often through
membership in a Multiple Listing Service (MLS), with the seller's broker.
An agency relationship exists when one person, the _____ acts for, or on behalf of another
person, the ______ - CORRECT ANSWERS✅✅agent, principal
which of the following is grounds for suspension or revocation of license by TREC? -
CORRECT ANSWERS✅✅splitting commission with a person other than a license holder
The commission can deny licensure to an applicant based on the applicant's
_______________________ - CORRECT ANSWERS✅✅moral character
Ostensible Agency - CORRECT ANSWERS✅✅exists when actions lead another person to
assume that one is an agent.
Agency by Ratification - CORRECT ANSWERS✅✅Occurs when an agent acts without
prior authorization, and the principal, upon learning of this action, accepts it.
agency coupled with an interest - CORRECT ANSWERS✅✅When a broker is the owner of
a property that is being sold, or when a broker is interested in buying a property, we have
agency coupled with an interest
Agency Authority - CORRECT ANSWERS✅✅or rights, may also be a result of "the norm",
or what is considered customary in the business
, Implied Authority - CORRECT ANSWERS✅✅an agent's authority to do things not
specifically authorized in order to carry out express authority
Fiduciaries - CORRECT ANSWERS✅✅are held to the highest amount of good faith, are
required to exclude all selfish interest, are prohibited from putting themselves in positions
where personal interest and representative interest will conflict and must, in any direct
dealing with the principal, make full disclosure of all relevant facts and give the latter an
opportunity to obtain independent advice
General Agent - CORRECT ANSWERS✅✅has less authority than the universal agent. Has
the right to represent his or her principal in a particular type of transaction or business. One
common example of a general agent in real estate is the property manager.
As agents, our fiduciary duties and responsibilities include - CORRECT
ANSWERS✅✅OLD CAR
Obedience
Loyalty
Disclosure
Confidentiality
Accounting
Reasonable care
Obedience - CORRECT ANSWERS✅✅an agent is obligated to follow all o the lawful
instructions of a client
The commission may suspend or revoke a license or take other disciplinary action if the
license holder, while acting as a broker or sale agent... - CORRECT
ANSWERS✅✅commingles money that belongs to another person with the license holders
own money
The disclosure of representation may be done - CORRECT ANSWERS✅✅orally or in
writing
