Agency and Fiduciary Duties Flashcards
7 cards from real Arkansas Real Estate License practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Agency and Fiduciary Duties flashcards as text
A buyer's agent who secretly accepts a referral fee from the seller's lender without disclosing it to the buyer has violated which fiduciary duty?
Answer: Loyalty
Loyalty requires the agent to place the client's interests above all others, including undisclosed financial benefits received from third parties.
Under Arkansas law, when must a licensee provide the Disclosure of Agency form to a prospective buyer?
Answer: At the first substantive contact
Arkansas requires agency disclosure at the first substantive contact with the prospective buyer, not at the offer stage.
A seller's agent learns that the seller is going through a divorce and must sell quickly. Sharing this information with the buyer would violate which duty?
Answer: Confidentiality
Confidentiality requires the listing agent to protect information the seller has not authorized to be shared, including personal circumstances affecting motivation to sell.
An Arkansas licensee acting as a dual agent receives written consent from both parties. Which of the following activities is the dual agent still prohibited from doing?
Answer: Disclosing the seller's minimum acceptable price to the buyer
Even with dual agency consent, the agent cannot reveal the seller's bottom-line price or the buyer's maximum offer, as this would harm one party for the benefit of the other.
Which scenario best describes an implied agency relationship in Arkansas real estate?
Answer: A buyer treats a licensee as their agent without a written agreement, and the licensee acts accordingly
Implied agency arises from the conduct of the parties rather than a written contract, which is why Arkansas strongly encourages written agency agreements.
An agent owes the duty of 'reasonable care and diligence' primarily to whom?
Answer: The agent's client
Reasonable care and diligence is a fiduciary duty owed specifically to the agent's own client, though agents also have statutory duties to third parties.
A listing agent discovers the home has a cracked foundation not mentioned by the seller. Under Arkansas law, the agent must:
Answer: Disclose it to prospective buyers as a material fact
Arkansas law requires licensees to disclose known material defects to all parties regardless of which party they represent.