A buyer's agent is in the middle of negotiating a purchase contract on behalf of her buyer client. Mid-negotiation, the buyer suffers a severe stroke and a probate court enters an order finding him legally incapacitated. The agent has not been appointed under any durable power of attorney. No written agreement contemplates the buyer's incapacity. The agent's authority to bind the now-incapacitated buyer ends automatically by operation of law, and the buyer's court-appointed guardian must establish a fresh agency relationship before negotiations may continue. Which doctrine ended the original agency?
Correct Answer
C) Termination by death or incapacity
Once the court ruled the buyer legally incapacitated, the bilateral consensual basis for the agency dissolved automatically — neither contractual continuation nor durable power survives. The doctrine that ends an agency when the principal (or agent) loses legal capacity is termination by death or incapacity.
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Previous Question
A listing agent signs a six-month exclusive right-to-sell agreement with a homeowner. Two months in, the agent decides to leave her brokerage and relocate out of state. She sends the homeowner a written notice stating that she is withdrawing from the representation, effective immediately. The homeowner has not asked her to leave, has not breached the contract, and has not consented to her departure. The agent's brokerage may now face a damages claim for the four remaining contract months, even though the agency itself ends with her notice. Which method ended the agency relationship?
Next Question
All of the following can terminate an agency relationship EXCEPT