Agency
Under the duty of obedience, an agent must follow the client's instructions EXCEPT when those instructions are:
AInconvenient for the agent
BContrary to what other agents typically do
CIllegal or unethical✓ Correct
DRelated to setting the listing price
Explanation
An agent must follow lawful instructions from their client (the duty of obedience) — but they are NOT required to follow instructions that are illegal, unethical, or that would require the agent to violate the law.
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Key Terms to Know
Net Operating Income (NOI)
The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
Fiduciary DutyThe highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
Earnest MoneyA deposit made by the buyer when submitting a purchase offer, demonstrating serious intent and serving as consideration for the contract.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
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