Tom is a New Jersey licensed salesperson working under broker Sandra. Tom's client, Ms. Chen, instructs him not to present any offers below $450,000 on her home listed at $475,000. A buyer submits a written offer for $430,000. What is Tom's obligation under New Jersey agency law?
Correct Answer
C) Follow Ms. Chen's instructions and decline to present the offer, documenting her directive in writing
Under New Jersey agency law, the duty of obedience requires a licensee to follow the lawful instructions of the client. Ms. Chen's instruction not to present offers below $450,000 is a lawful directive, and Tom must follow it. Proper practice requires documenting the client's instruction in writing to protect all parties. The duty of obedience applies to lawful instructions even when the licensee might personally disagree with the strategy.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A non-agency relationship where the broker facilitates a real estate transaction without representing either party, owing limited duties of honesty, fairness, and competence to both.
The legal principle that holds a broker responsible for the actions of their agents and employees performed within the scope of the agency relationship.
An agency relationship created when a principal's actions or words lead a third party to reasonably believe that an agent has authority, and the principal fails to correct this belief.
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