A broker is adjudicated incompetent by a court while a listing agreement is still in effect. What is the most likely consequence for the agency relationship?
Correct Answer
B) The agency terminates by operation of law due to the agent's incapacity
When the agent loses legal capacity, the agency generally terminates by operation of law because a legally incompetent person cannot fulfill fiduciary duties.
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Previous Question
An agent without any prior authority negotiates a reduced-price deal on behalf of the property owner. The owner, after learning the full details, decides to accept the deal. What legal concept allows the owner to validate the agent's unauthorized act?
Next Question
A property owner allows a neighbor to show the property to friends and even negotiate on the owner's behalf over several months, but no written or oral agreement was ever made. A court later finds an agency existed. How was this agency most likely created?