Agency on the real estate exam, who you work for

A listing agent receives a low-ball offer on their client's property from a limited liability company (LLC). The agent is a partial owner of the LLC but does not disclose this fact to the seller, who accepts the offer. Which fiduciary duty has the agent primarily violated?

1. Obedience, by failing to follow the seller's instructions regarding the evaluation of third-party offers.
2. Loyalty, by engaging in undisclosed self-dealing that directly conflicts with the client's interests.
3. Reasonable care, by failing to prepare market analysis ensuring the offer was highly competitive.
4. Confidentiality, by sharing the seller's minimum price with the members of the purchasing entity.
5. Accounting, by mismanaging the earnest deposit provided by the LLC during the contract negotiation.

A seller signs an exclusive agency listing agreement with a broker. Two weeks later, the seller's coworker sees the broker's yard sign and approaches the seller directly. The seller and coworker successfully negotiate a purchase agreement without the broker's involvement. Which statement is TRUE regarding the broker's commission?

1. The broker earns no commission because the seller directly procured the buyer through independent means.
2. The broker receives a full commission because the agreement prohibits the seller from independent self-procurement.
3. The broker earns no commission unless they prove the coworker originally viewed the online listing.
4. The broker receives a partial commission representing the marketing expenses incurred for the yard sign.
5. The broker receives a full commission because the buyer initially saw the broker's yard sign.

A listing agent receives a written offer that is 50% below the asking price. Knowing the seller will be insulted, the agent decides not to present the offer, documenting it as frivolous. Which duty has the agent violated?

1. The duty to promptly disclose all material facts and written offers
2. The duty of strict accounting for all earnest money deposits received
3. The duty to exercise reasonable skill and care in qualifying buyers
4. The duty of obedience to the seller's implied pricing instructions
5. The duty to maintain client confidentiality during active negotiations

A seller tells their listing agent that the property is zoned for commercial use, and the agent includes this in the listing without checking municipal zoning records. A buyer later discovers the zoning is residential. Which duty has the listing agent breached?

1. The duty of confidentiality regarding zoning status
2. The duty of accounting for misrepresentation
3. The duty of obedience to the seller's instruction
4. The duty of loyalty to the seller
5. The duty of reasonable care and diligence

A seller's agent learned the seller's minimum acceptable price. After closing, the agent represented a buyer against the same seller and used that information to negotiate a lower price. Which duty was breached?

1. Breach of confidentiality
2. Breach of obedience
3. Breach of reasonable care and skill
4. Breach of loyalty
5. Breach of disclosure

A listing broker presents a full-price, contingency-free offer that perfectly matches the seller's exclusive right-to-sell listing terms. The seller simply changes their mind and refuses to sign the offer. What is the broker's legal position?

1. The broker cannot claim a fee without a signature.
2. The broker has fully earned the commission.
3. The broker is entitled to only half the commission.
4. The broker must wait until the listing term expires.
5. The broker's only remedy is keeping the earnest money.

To encourage a buyer to increase their offer, a listing agent falsely tells the buyer's agent that there are currently multiple competing offers on the property. Which statement best describes the listing agent's action?

1. It is an unlawful misrepresentation that violates the agent's statutory professional duties.
2. It is a standard industry practice protected under the principle of caveat emptor for prospective buyers.
3. It is a permissible negotiation tactic since the agent must place the client's interests above all.
4. It is an acceptable practice provided the property is listed in a highly competitive seller's market.
5. It is legal as long as the seller explicitly instructed the agent to employ aggressive negotiations.

A seller signs an exclusive right-to-sell listing agreement but unexpectedly dies before any offers are received. The next day, the broker brings a full-price offer to the seller's heirs. Which statement is MOST accurate regarding this situation?

1. The exclusive listing agreement automatically transfers to the heirs
2. The listing agreement is terminated upon the principal's death
3. The broker retains the legal right to a full commission for the offer
4. The heirs are contractually obligated to accept the full-price offer
5. The broker may secure the commission via a probate court property lien

A listing agent repeatedly provides strategic advice to an unrepresented buyer on how to structure a counteroffer to ensure the seller accepts it. Neither party has signed a dual agency consent form. What is the MOST likely result of the agent's actions?

1. The creation of an undisclosed and implied dual agency
2. The legal execution of transaction brokerage between the two parties
3. The fulfillment of standard fair dealing duties to a customer
4. The violation of the statute of frauds regarding buyer representation
5. The establishment of a designated agency via negotiation assistance

A broker's exclusive right-to-sell listing included a 60-day protection clause. During the listing, the broker gave the seller written notice of Buyer X, who made an offer that failed. The listing expired, and no new listing was signed. Within 60 days, the seller sold directly to Buyer X. What commission is the broker entitled to?

1. A full commission if the sale is within the protected period
2. A commission only if the seller signed a new listing with the same broker
3. No commission because the buyer did not purchase under the original offer
4. No commission because no listing agreement existed when the direct sale occurred
5. A reduced commission because the original transaction failed

A broker represents both the buyer and seller in a $10M commercial strip mall transaction. Assuming the corporate investors are highly sophisticated, the broker proceeds without obtaining written dual agency consent. Which statement is correct?

1. Written consent is optional if both transaction parties are represented by in-house legal counsel.
2. The broker must secure informed written consent from both principals before acting as a dual agent.
3. Commercial transactions exceeding $5M are federally exempt from standard dual agency disclosures.
4. The broker may legally proceed if verbal consent is obtained from the corporate investors.
5. Corporate sophistication automatically waives all statutory agency disclosure obligations.

An agent procures a ready, willing, and able buyer who signs a purchase contract. The seller revokes the agency before closing and later sells directly to the same buyer at a lower price. Is the agent owed a commission?

1. Yes, but only half because the price was lower
2. No; revocation ended all rights
3. No; buyer did not complete
4. Yes; agent was procuring cause

A broker proposes a net listing in a state where net listings are unlawful. The seller would receive $250,000 net; excess is broker's commission. The most significant problem is:

1. The seller must pay the commission before closing
2. The seller cannot guarantee the net amount
3. The broker has a conflict of interest
4. The broker overprices the property
5. The seller nets less than comparable sales

A listing agent learns from the seller that a job transfer creates an urgent need to sell within 30 days. The escrow officer handling the transaction requests that the agent provide all material facts affecting the sale. The seller has not authorized release of this information. Which action should the listing agent take?

1. Tell the escrow officer the urgency because it helps the seller
2. Ask the buyer's agent to disclose it instead
3. Withhold all information even if disclosure is legally required
4. Disclose what the seller authorizes or the law requires
5. Provide all material facts because the escrow officer is neutral

A seller's listing with Broker A expires. Broker A's listing had a 90-day protection clause that does not apply if the seller signs a new exclusive listing with another broker. The seller immediately relists with Broker B, and Broker A's previous prospect buys the property during the 90 days. Which statement about Broker A's commission is correct?

1. Broker A retains full commission rights because the buyer was a registered prospect.
2. Broker A receives a standard finder's fee but not the full agreed-upon commission rate.
3. Broker A and Broker B must split the commission evenly under standard MLS rules.
4. Broker A loses commission entitlement because the new listing voided the clause.
5. Broker A can place a statutory mechanic's lien on the property for the unpaid fees.

A broker lends a seller $50,000 and, as security, receives a written power to sell the seller's property and repay the loan from the proceeds. Before the loan is repaid, the seller tries to revoke the broker's authority. What is the result?

1. The seller cannot revoke it while the loan is unpaid
2. The broker gains unlimited authority over all the seller's property
3. The seller can revoke it at any time, like any agency
4. The authority ends automatically if the seller dies