Agency
Which of the following best describes 'ratification' of agency?
AThe principal expressly authorizes the agent before the agent acts
BThe principal approves an unauthorized act performed by the agent after the fact✓ Correct
CThe agent takes emergency action on behalf of the principal
DTwo principals share the same agent
Explanation
Ratification occurs when a principal approves or confirms an act already performed by someone acting (or claiming to act) as their agent, even though the agent lacked authority at the time. The principal's after-the-fact approval makes the act binding.
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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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