In a general agency relationship, which party bears responsibility for the agent's actions?

In a general agency relationship, which party bears responsibility for the agent's actions?

• A. The agent
• B. The client
• C. The principal
• D. The broker

Answer: (C)

In a general agency relationship, the principal is the one who bears responsibility for the agent’s actions when those actions fall within the scope of the authority granted. The agent acts on behalf of the principal, so the principal is bound by what the agent does in the course of that authority. The broker’s role is to supervise and facilitate the agency, but ultimate accountability to third parties for the agent’s conduct within the authority rests with the principal (the client).

In a general agency relationship, the principal is the one who bears responsibility for the agent’s actions when those actions fall within the scope of the authority granted. The agent acts on behalf of the principal, so the principal is bound by what the agent does in the course of that authority. The broker’s role is to supervise and facilitate the agency, but ultimate accountability to third parties for the agent’s conduct within the authority rests with the principal (the client).