A.D. Cantelmo Property Management
Our Business is Property Management in Orange County California
Law of Agency
As I said last time, I am in the process of renewing my
Brokers License, so I am going to share with you as I go through the process
and the first part is the law of Agency.
involving real property should be in writing, such as listings, trusts, and
powers of attorney. The people involved in an agency relationship
are the agent, principal (client), and third party (customer).
is a person who has the authority to act on the behalf of another, representing
the business interests of that person.
The principal is the client
who gives authority to an agent to represent his or her interests in dealing
with third parties.
A third party is a customer who may be
affected by the terms of an agreement but who is not a part of the agreement.
The principal hires the agent to
perform a service and gives the agent authority to act for or on behalf of the
principal. The agent is in a position of trust with the principal and
owes the principal certain fiduciary duties. This creates a fiduciary
relationship between the agent and the principal. A fiduciary
relationship implies a position of trust and confidence. This applies
to agency relationships in various types of industries, not just real estate.
The authority given an agent is
determined by the principal. Depending upon the agency classification,
the scope of authority delegated to the agent by the principal may vary
Usually, the agent’s authority is categorized as general agency
or special agency. General agency is a relationship in which a principal
delegates ongoing tasks or duties to an agent under his or her employ. A general
agent is authorized by a principal to perform all tasks associated with the
continued operation of a particular project.
general agent may have significant responsibilities and liabilities and, as a
result, the principal is liable and accountable for all of the agent’s actions.
In the real estate business, a property
manager is a good example of a general agent. He or she is responsible
for preserving the value of the real estate investment while generating income
for the owner. In my business of Property Management in Anaheim Ca. I am a
Special agency is a
relationship in which a principal delegates limited tasks or specific duties to
an agent under his or her employ. A special agent is sometimes referred
to as a limited agent because this is the most restricted agency
relationship. A special agent is a person employed to perform a
particular task or transaction for a specified amount of time. a Real Estate Broker under a signed listing agreement is the special agent of the owner of
the property. A special agency also exists between the broker and buyer
under a signed buyer representation agreement. These agreements give the
broker permission to act on the client’s behalf.
a listing agreement, the broker is given the authority to list, market, and
sell the client’s property. With a buyer representation agreement, the
broker is given the authority to represent the client on the purchase of a
property. In both examples, the agents are not able to bind the principal
to a contract. Rather, they are hired to represent the client for a
certain amount of time for a specified task.
A.D. Cantelmo Property
Management Specializes in Property Management in Orange County