License Law and Agency Practice Question

Question

A buyer and seller disagree about a closing issue in a Texas real estate transaction involving agency duties. Which response best applies the rule? (Item 124)

Answer choices

1. A. Escrow automatically assumes all brokerage disclosure and agency duties.
2. B. The client’s preference eliminates the need to disclose known material facts.
3. C. The party who complains first automatically receives the legal remedy requested.
4. D. Apply loyalty, disclosure, confidentiality, accounting, and reasonable care duties.

Correct Answer

D. Apply loyalty, disclosure, confidentiality, accounting, and reasonable care duties.

Explanation

The correct answer is D because agency duties requires candidates to apply loyalty, disclosure, confidentiality, accounting, and reasonable care duties. The other options rely on unsafe assumptions about custom, oral agreement, escrow, client preference, or independent salesperson authority and do not reflect sound Texas exam practice.

Question details

• Difficulty: hard
• Domain: License Law and Agency
• Objective: agency duties

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