Name: Tracy Z. Francis
REAL ESTATE PRINCIPLES – SLO PROJECT
I. Define Agency:
The relationship between principal and agent which arises out of a contract,
either expressed or implied, written, or oral; wherein the agent is employed by the
principal to do certain acts dealing with a third party.
II. What Fiduciary Duties are owed by an agent to the principle. Define each duty.
A fiduciary duty of utmost care, integrity, honest, and loyalty in ALL dealings.
• Obedience: As an agent of your client, you must obey their instructions, barring
illegal, unethical requests, or requests which contradict terms of the contract.
• Loyalty: As the agent for your client, you must be loyal and keep their best
interests ahead of those of any other party, including yourself. How much commission
you might make, particularly in competing offer situations, should not be a
consideration and would be disloyal to your client.
• Disclosure: In many states the law requires a real estate agent, whether in an
“agency” capacity or not, to disclose material facts to their client. Material facts are
those which, if known by the buyer or seller, might affect purchase or sale actions.
• Confidentiality: Your fiduciary duty of confidentiality means that you do not disclose
anything that you learn about your client, their business, financial or personal affairs
