Agency
In Kentucky, a principal can be held responsible for the acts of their agent when:
AThe agent is acting outside the scope of their authority
BThe agent acts within the actual or apparent authority granted by the principal✓ Correct
CThe agent commits a crime
DThe agent works independently without supervision
Explanation
The principal (broker/client) may be held vicariously liable for the agent's acts that fall within the actual or apparent scope of authority. Acts outside all authority may not bind the principal.
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
Dual AgencyA situation where a single real estate agent or brokerage represents both the buyer and the seller in the same transaction.
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.
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