ContractsIntermediateAlaska Exam

In Alaska, an agreement that an agent will be paid only if a sale successfully closes is most accurately described as a:

ARetainer agreement
BContingent fee or success feeCorrect
CListing agreement
DCommission-free arrangement, in general

Why Contingent fee or success fee Is Correct

Answer B: Contingent fee or success fee

An arrangement where the agent's compensation depends on the successful completion of a transaction (the sale closing) is called a contingent fee or success fee. This is the standard arrangement in real estate — agents typically earn compensation only when a transaction closes.

Exam Tip: Contracts

Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.

Key Contracts Terms in This Question

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