Agency
Under Massachusetts law, an agent's duty to account means the agent must:
AFile tax returns for the client
BPromptly account for all money and property received on behalf of the client✓ Correct
CMaintain a separate savings account for each client
DReport all transactions to the IRS
Explanation
The fiduciary duty of accounting requires the agent to accurately account for all funds and property received on the client's behalf, provide accurate records, and promptly deliver money and property to the client.
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Key Terms to Know
Fiduciary Duty
The highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
LienA 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.
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