Charles J. Jacobus : Real Estate Law 2nd Edition.

South Western-Thomson Learning

 Page 119: The Agent Acts in the capacity of a fiduciary. That is, there is a duty of trust,
confidence, and honest business dealing that is owed to his principal.

 Page 119: The term performance (often referred to as obedience) indicates that the broker
will use his best efforts and diligence to market his principals property for the highest price
then obtainable.

 Page 120: The duty of loyalty is probably the most easily breached fiduciary capability. It
includes not only the broker’s duty to put the principal’s interests above that of his own, but
also an all-encompassing obligation of full disclosure to the principal of all pertinent facts
known to the broker.

 Page 128: The duty of reasonable care generally implies competence and expertise on the
part of the broker. He has a duty to disclose knowledge and material facts concerning the
property and cannot become a party to any fraud or misrepresentation likely to affect the
sound judgment of his principal

 Page 130: Duties of Principal to Agent: Performance-The principal is expected to do

whatever he reasonably can to help accomplish the purpose of the agency.

 Ibid: Compensation-if the agent can produce a willing and able buyer, he is entitled to be
paid.

 Ibid: Reimbursement-principal must reimburse the agent for expenses made on the
principal’s behalf. This does not mean that the principal has to reimburse the agent for the
costs of advertising, entertainment, and other costs of doing business. Those are clearly, the
agent’s responsibility. However, other professional costs are encompassed, minor repairs
and other small expenses to keep the property in good condition. When these expenses are
made in good faith and within the scope of the agent’s authority, he is entitled to
reimbursement from the principal.

 Ibid: Indemnification: This duty arises when the agent suffers loss through no fault of his
own while performing his duties on behalf of the principal, such as innocent
misrepresentation by the broker when he is performing acts on behalf of the principal.