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Heather is a Tennessee affiliate broker who has been showing properties to buyer clients Tom and Susan for six weeks. During this time, she has never provided them with the TREC Agency Disclosure form. Tom and Susan now want to make an offer. When Heather finally presents the disclosure form at the offer stage, Tom asks what type of agency relationship they have had for the past six weeks. Under Tennessee law, what is the most accurate characterization of the past six weeks?

Correct Answer

C) Heather may have violated Tennessee's agency disclosure requirement by failing to disclose at first substantive contact

Under Tenn. Code Ann. § 62-13-401 et seq., the TREC Agency Disclosure form must be provided at first substantive contact. Heather's first substantive contact with Tom and Susan almost certainly occurred at or before the first property showing, when real estate needs and financial qualifications were discussed. Failing to provide the disclosure form for six weeks is a violation of Tennessee's agency disclosure requirement and could subject Heather to disciplinary action by TREC.

Answer Options
A
Heather was functioning as a buyer's agent because she was showing properties to Tom and Susan
B
Heather was functioning as a seller's sub-agent because no written buyer representation agreement existed
C
Heather may have violated Tennessee's agency disclosure requirement by failing to disclose at first substantive contact
D
The agency relationship is valid because Tennessee only requires disclosure before the offer is submitted

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Related Topics & Key Terms

Key Terms:

agency_disclosurefirst_substantive_contactTREC_violationtiming_requirement

Related Concepts

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.

An agency relationship created when a principal approves or accepts an agent's previously unauthorized actions, effectively granting authority after the fact.

The legal requirement for real estate agents to inform all parties about who they represent in a transaction, typically provided at first substantive contact.

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