An agency relationship in real estate is terminated in multiple ways. All of the following are likely to be the cause of termination of an agency relationship, except:
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The incapacity or death of either the seller or broker.
Revocation of the agency by the owner.
Revocation by the owner is a valid method of terminating agency relationships. Principals generally have the right to revoke authority at any time, though this may not relieve them of obligations already incurred.
Destruction of the property.
Destruction of the property makes performance impossible, which is an automatic termination of the agency relationship. The broker cannot fulfill their duties when the subject property no longer exists.
Estoppel.
Estoppel can terminate an agency relationship when a party's actions lead another to reasonably believe the relationship has changed or ended, preventing them from denying that belief.
Why is this correct?
Option A is correct because under California law, the death of a broker does not automatically terminate the agency relationship if the broker has designated qualified associates who can continue the brokerage operations. This exception makes it different from the typical termination by death rule.
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