AgencyIntermediateArizona Exam

An Arizona agent who negotiates a sale of their principal's property at a price below market to enable the agent or a related party to profit is committing:

AA permissible exercise of negotiation skill
BA breach of the fiduciary duty of loyalty and self-dealingCorrect
CAn acceptable practice if the principal agrees after the fact
DOnly an ethics violation, not a license violation

Why A breach of the fiduciary duty of loyalty and self-dealing Is Correct

Answer B: A breach of the fiduciary duty of loyalty and self-dealing

Self-dealing—where an agent arranges a transaction to benefit themselves at the client's expense—is a fundamental breach of the fiduciary duty of loyalty. It is both an ethics violation and a license law violation.

Exam Tip: Agency

Agency questions are among the most tested on the exam. Focus on the difference between client and customer, and memorize the fiduciary duties (OLD CAR). Watch for questions that try to blur the line between a general agent and a special agent.

Key Agency Terms in This Question

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