Section 876 IAC 2-8-5 - Real estate brokerage; law of agencyAuthority: IC 25-34.1-2-5
Affected: IC 25-34.1-5
Sec. 5.
(a) The competency and instructional level for general agency concepts and definitions for real estate brokerage and law of agency is Level 2.(b) The competency and instructional level for subdivisions (1) through (3) is Level 2. The following are concepts of the classification of agency relationships: (c) The competency and instructional level for subdivisions (1) through (2) is Level 3. The following are concepts of employment and authority of the real estate agent: (1) Brokerage contracts (as source of authority). (Cover listing contracts and property management contracts in detail where subsequently addressed.)(2) Extent (scope) of agent's authority.(d) The competency and instructional level for subdivisions (1) through (4) is Level 3. The following are general concepts of agency and subagency situations: (1) Listing with independent broker, e.g., a single broker working alone.(2) Listing with brokerage firm.(3) Multiple listing service (or cooperating broker).(4) Buyer-broker relationship.(e) The competency and instructional level for subdivisions (1) through (3) is Level 3. The following are duties and liabilities of agents: (1) Agent's duties to principal including the following: (A) Loyalty and obedience. (Note potential problems involved with "self-dealing" and "conflict of interest" situations.)(B) Skill, care, and diligence.(C) Disclosure (and nondisclosure) of information.(E) Competency in the particular activity.(F) Fiduciary responsibilities.(2) Agent's duties to third persons (buyers and tenants) including the following: (A) Difference between "client" and "customer" in real estate practice.(B) General duty of "honesty and fairness".(C) The following prohibited conduct: (i) Willful misrepresentation.(ii) Negligent misrepresentation.(3) The following liabilities and consequences of agent's breach of duties: (A) Disciplinary action by real estate commission against agent.(B) Civil liability of agent.(C) Criminal liability of agent.(D) Civil liability of principal (for agent's misconduct).(f) The competency and instructional level for subdivisions (1) through (3) is Level 3. The following are duties and liabilities of principals: (1) The following principal's duties to agent: (2) Principal's duties to third persons. (Note doctrine of caveat emptor and limitations to such doctrine established by consumer protection laws and judicial decisions.)(3) The following are liabilities and consequences of principal's breach of duties: (A) Criminal liability in some cases.Indiana Real Estate Commission; 876 IAC 2-8-5; filed Dec 1, 1989, 5:00 p.m.: 13 IR 640; readopted filed Jun 29, 2001, 9:56 a.m.: 24 IR 3824; readopted filed Jul 19, 2007, 12:57 p.m.: 20070808-IR-876070067RFA; readopted filed November 25, 2013, 9:21 a.m.: 20131225-IR-876130283RFA