Question 81

The agency relationship between the buyer and broker has been terminated due to operation of law as a result of death.

The agency relationship can be terminated by operation of law when one party, either the buyer or the broker, has died, thereby dissolving the legal agreement.

A) The buyer or the broker has died.

This option is correct as the death of either party automatically terminates the agency relationship, which is a legal requirement under agency law. The principle behind this is that a contract cannot continue if one of the parties involved is no longer alive to fulfill their obligations.

B) The sales associate working with the buyer has died.

This option is incorrect because the death of a sales associate does not terminate the agency relationship between the buyer and the broker. The agency relationship is specifically between the buyer and broker, and the associate's death does not affect this legal agreement.

C) One of the parties cancelled the buyer agency agreement.

This option is incorrect in the context of operation of law. While cancellation by one of the parties can terminate an agency relationship, it does not occur by operation of law; instead, it is an action taken by one of the parties.

D) The parties mutually agreed to cancel the buyer agency agreement.

This option is also incorrect as it does not represent a termination by operation of law. Although mutual agreement can terminate an agency relationship, it is a voluntary action rather than a legal requirement that occurs automatically.

Conclusion

The correct answer is A, as the death of either the buyer or the broker leads to an automatic termination of the agency relationship by operation of law. All other options involve actions that do not occur by operation of law, either requiring voluntary action or relating to parties not directly involved in the agency agreement. Thus, option A is the only choice that fits the criteria outlined in the question.