10.15 Breach of Duties

Common law fiduciary duties and statutory duties become the affirmative obligations of the agent at the very moment the agency relationship is created. If the agent fails to perform these duties, a legal breach occurs. This is the case regardless of whether the breach arises out of innocent, negligent, or intentional conduct.

The principal can also be held responsible for a breach of the agency relationship. If this occurs, the principal can be liable for damages. Most lawsuits against licensees arise out of conduct that either lead to a breach of a fiduciary duty owed to the principal or the expanding legal duties owed to a third party. Any breach of duties owed to a principal or third party can subject the licensee to civil damages or criminal prosecution. In addition, the State Real Estate Commission can impose a wide range of disciplinary actions on the licensee who breaches fiduciary duties.