Agency
Vicarious liability in a Michigan real estate context means that a broker:
AIs personally liable for all crimes committed in the state
BMay be held liable for the wrongful acts of their salespersons acting within the scope of employment✓ Correct
CCannot be sued by consumers
DIs only liable for their own personal errors
Explanation
Under the principle of vicarious liability, a broker can be held legally responsible for the actions of their affiliated salespersons when those actions occur within the scope of the employment relationship.
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Key Terms to Know
Agency
A 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.
Listing AgreementA contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
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