Wisconsin Real Estate Salesperson Exam — All Questions

Under Wis. Stat. 452.133, a Wisconsin licensee owes duties to all parties to a transaction, including the duty to disclose to each party:

• a.Nothing about the property
• b.Material adverse facts the licensee knows✓
• c.The internal commission split
• d.The other party's personal motivation

Wisconsin Statute 452.133 sets duties a licensee owes to all parties, such as acting honestly and in good faith, and disclosing to each party material adverse facts that the licensee knows and that the party does not and could not discover through reasonable inspection.

In Wisconsin, a firm may provide brokerage services to more than one party in the same transaction (multiple representation) only with the:

• a.Approval of the Examining Board
• b.Written consent of the parties✓
• c.Verbal consent of one party
• d.Consent of the multiple listing service

Wisconsin permits a firm to represent more than one party in a transaction only when the parties give written consent after disclosure. Multiple representation limits how the firm can advocate for each client and requires protecting each party's confidential information.

Which duty does a Wisconsin firm owe ONLY to its clients, and not to every party in the transaction?

• a.The duty to safeguard trust funds and other property held
• b.The duty to keep confidential information confidential
• c.The duty to disclose material adverse facts in writing
• d.The duty to negotiate on behalf of the person✓

The duties owed to all parties under s. 452.133 (1) include honest and fair service, reasonable skill and care, timely written disclosure of material adverse facts, confidentiality, market information, safeguarding trust funds, and objective presentation of proposals. The duty to negotiate appears only in s. 452.133 (2) (d), among the additional duties to clients. Cite: Wis. Stat. 452.133 (1) and (2) (d).

Under Wis. Stat. 452.133 (6), which duty may a Wisconsin client waive?

• a.The duty of loyalty to the client's interests
• b.The duty to keep the client's information confidential
• c.The duty to negotiate on the client's behalf✓
• d.The duty to disclose material adverse facts

Section 452.133 (6) makes the duties under subs. (1), (2) (a), (am), (b) and (c), (4) and (5) non-waivable. Only the duty to negotiate under sub. (2) (d) may be waived, and only if the firm first gives the client a written disclosure quoting sub. (2) (d) and s. 452.01 (5m) and warning that an attorney or other provider may be needed. Cite: Wis. Stat. 452.133 (6).

A Wisconsin firm is showing property to a buyer who has signed nothing. May the firm negotiate the purchase for that buyer?

• a.No, unless the buyer is the firm's client or a principal's client✓
• b.Yes, because a firm may serve any party without an agency agreement
• c.Yes, if the firm first delivers the statutory disclosure to customers
• d.No, unless the listing firm consents to the negotiation in writing

Section 452.134 (1) (a) does let a firm provide brokerage services to any party with or without an agency agreement, but sub. (1) (b) draws the line at negotiating: a firm may not negotiate on behalf of a party unless that party is the firm's client or a client of a principal firm that engaged the firm as a subagent. Cite: Wis. Stat. 452.134 (1).

A Wisconsin firm represents both the buyer and the seller and wants different agents to negotiate for each. What does designated agency require?

• a.Oral consent from each client, confirmed at closing
• b.Written consent from all of the firm's clients in the relationship✓
• c.Approval of the supervising broker and written notice to the board
• d.Written consent from the seller only, as the firm's first client

Section 452.134 (3) (a) bars a firm in a multiple representation relationship from engaging in designated agency unless all of the firm's clients in that relationship have consented in writing, and lets any client withdraw that consent by written notice to the firm at any time. Cite: Wis. Stat. 452.134 (3) (a).

A Wisconsin client in a multiple representation relationship refuses to consent to designated agency. How must the firm then proceed?

• a.It must withdraw from representing one of the two clients at once
• b.It may favor whichever client signed the agency agreement first
• c.It must refer the second client to an unaffiliated firm
• d.It may not put one client's interests ahead of another's✓

Section 452.134 (4) governs a multiple representation relationship without designated agency: if a client does not consent to designated agency or withdraws consent, neither the firm nor its licensees may place the interests of any client ahead of the interests of any other in the negotiations. Cite: Wis. Stat. 452.134 (4).

When must a Wisconsin firm give a client the statutory "Disclosure to Clients"?

• a.Not later than the time the firm enters into the agency agreement✓
• b.Within 3 business days after the agency agreement is signed
• c.At the first showing of any property to the client
• d.Not later than the time the client's offer is presented

Section 452.135 (2) (a) requires the firm to provide the written Disclosure to Clients no later than the time the firm enters into an agency agreement with the client. For one- to four-unit residential property, sub. (2) (b) also requires the firm to request the client's signed acknowledgment if the disclosure is not built into the agency agreement. Cite: Wis. Stat. 452.135 (2).

A Wisconsin principal firm engages another firm as a subagent. What does the subagent owe the principal firm's client?

• a.The same client duties the principal firm owes, including loyalty
• b.No duties at all, because the client has no agreement with the subagent
• c.The all-party duties, and no placing itself ahead of that client✓
• d.Only the duty to keep the client's information confidential

Section 452.133 (4) (a) gives a subagent the sub. (1) duties owed to all parties it serves, but not the sub. (2) client duties toward the principal firm's clients. Sub. (4) (b) still forbids the subagent from placing its own interests ahead of those clients or giving advice contrary to their interests. Cite: Wis. Stat. 452.133 (4).

A Wisconsin transaction closes and the firm's agency agreement ends. What happens to the confidential information the firm learned?

• a.It may be disclosed once the agency agreement terminates
• b.It must be kept confidential after the transaction is complete✓
• c.It may be disclosed to the firm's other clients but not to the public
• d.It must be kept confidential for 2 years after the closing date

Section 452.133 (1) (d) expressly requires the firm to continue keeping the information confidential after the transaction is complete and after the firm is no longer providing brokerage services to the party. The duty ends only if the law compels disclosure or the affected person authorizes it. Cite: Wis. Stat. 452.133 (1) (d).

A Wisconsin buyer's agent negotiating for a home phones the listing firm for the first time. When must the buyer agency relationship be disclosed?

• a.Only when the buyer's written offer is delivered
• b.Within 24 hours after the first substantive conversation
• c.Only if the listing firm asks who the licensee represents
• d.At the earliest of first contact, a showing, or any other negotiation✓

Section REEB 24.07 (8) (a) 2. requires a licensee acting as agent for a buyer of one- to four-family residential property, when negotiating directly with the seller or aware of an exclusive listing, to notify the seller or listing firm of the buyer agency relationship at the earlier of first contact where transaction information is exchanged, a showing of the property, or any other negotiation. Cite: Wis. Admin. Code REEB 24.07 (8) (a) 2.

A Wisconsin licensee repeats a misstatement about a property that the licensee invented. Is the seller-client liable for it?

• a.No, unless the client knew or should have known of it✓
• b.Yes, because the licensee is the client's agent in the transaction
• c.Yes, but only up to the amount of the commission earned
• d.No, because a client is never liable for a licensee's statements

Section 452.139 (2) (a) shields a client from liability for a misrepresentation made by the firm or its licensees unless the client knows or should have known of it, or the misrepresentation is one the licensee is repeating from the client. A client remains liable for misrepresentations the client makes. Cite: Wis. Stat. 452.139 (2).