Humber/Ontario Real Estate Course 2 Exam Practice

Which of the following statements is correct regarding agency relationships in real estate?

1. An express agreement is not necessary to create an agency relationship.

2. An agency relationship can be created unintentionally by actions.

3. The relationship must be in writing to be valid.

4. A dual agency is always favored over single agency.

The correct answer is: An agency relationship can be created unintentionally by actions.

An agency relationship can be created unintentionally by actions. This means that even without a formal written agreement, an agency relationship can still exist based on the actions or behaviors of the parties involved. It is essential to understand that agency relationships can be formed even if it was not the initial intent, based on how the parties interact and conduct themselves. Regarding the other options: A. An express agreement is not necessary to create an agency relationship - While an express agreement can certainly establish an agency relationship, it is not always required as agency can also be formed implicitly through actions or conduct. C. The relationship must be in writing to be valid - While having a written agreement can provide clarity and delineate the terms of the agency relationship, it is not always a strict requirement for an agency relationship to be considered valid. D. A dual agency is always favored over single agency - This statement is incorrect. Dual agency, where one agent represents both the buyer and seller in a transaction, can present conflicts of interest and is not always favored over single agency representation where each party has their own agent.