Asked by AZALEA RODRIGUEZ on Jul 26, 2024
Verified
Morgan,an agent,was instructed to sell Drew's property at a specified "firm" price of $450,000.A month later,the value of the property decreased substantially to $75,000 because of zoning changes.What is the status of the agency relationship?
A) Most likely,the agency is terminated because of impossibility.
B) It would terminate unless Drew had given Morgan a durable power of attorney.
C) It becomes an agency coupled with an interest,and continues unaffected by any change what so ever.
D) It requires the agent to compensate the principal with less compensation.
Agency Relationship
A legal and principal relationship between two parties, where one (the agent) is authorized to act on behalf of the other (the principal) in business transactions.
Durable Power Of Attorney
A document that authorizes an agent to act on another’s behalf, with the power either surviving incapacity or becoming effective upon incapacity.
Zoning Changes
Modifications or amendments to municipal regulations that dictate how land and buildings within specific zones can be used.
- Analyze how external conditions such as changes in property value or bankruptcy affect agency relationships.
Verified Answer
Learning Objectives
- Analyze how external conditions such as changes in property value or bankruptcy affect agency relationships.
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