AgencyIntermediateDelaware Exam

What is 'agency by ratification' in Delaware real estate?

AAgency created by the Commission's approval
BAn agency relationship created when a principal approves unauthorized acts taken on their behalf after the factCorrect
CAgency created through a formal written agreement
DThe process of the state ratifying an agency's license

Why An agency relationship created when a principal approves unauthorized acts taken on their behalf after the fact Is Correct

Answer B: An agency relationship created when a principal approves unauthorized acts taken on their behalf after the fact

Agency by ratification occurs when a principal approves (ratifies) acts taken by a person without prior authorization, thereby creating an agency relationship retroactively. The principal's approval of the unauthorized acts binds them as if authority had been granted initially.

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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