A licensee has a buyer who is the principal. What type of agency relationship exists?

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Multiple Choice

A licensee has a buyer who is the principal. What type of agency relationship exists?

Explanation:
Representing only one party in a transaction is called a single agency relationship. Here, the buyer is the principal, so the licensee is acting as the buyer’s agent, with fiduciary duties owed to the buyer such as loyalty, confidentiality, and acting in the buyer’s best interests. Dual agency would occur only if the same licensee represented both the buyer and the seller in the same deal, which isn’t the case here. Open or no agency wouldn’t fit because there is an actual principal being represented and duties are being exercised on that principal’s behalf.

Representing only one party in a transaction is called a single agency relationship. Here, the buyer is the principal, so the licensee is acting as the buyer’s agent, with fiduciary duties owed to the buyer such as loyalty, confidentiality, and acting in the buyer’s best interests. Dual agency would occur only if the same licensee represented both the buyer and the seller in the same deal, which isn’t the case here. Open or no agency wouldn’t fit because there is an actual principal being represented and duties are being exercised on that principal’s behalf.

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