Indiana Real Estate Broker Exam — All Questions
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An agent's fiduciary duty to place the principal's interests above the agent's own and to avoid conflicts of interest is the duty of:
- a.Loyalty✓
- b.Accounting
- c.Disclosure
- d.Reasonable care
Loyalty requires the agent to act solely in the principal's best interest and avoid self-dealing or conflicts of interest. Accounting concerns safeguarding and reporting the principal's money and property; disclosure requires sharing material facts. These are commonly summarized by the acronym OLD CAR.
An agency relationship that is created by the conduct of the parties rather than by a written or spoken agreement is a(n):
- a.Express agency
- b.Implied agency✓
- c.Designated agency
- d.Dual agency
Implied agency arises from the actions and conduct of the parties, even without a formal contract, when a person reasonably relies on another to act as their agent. Express agency, by contrast, is created by a written or oral agreement that states the relationship.