54. A licensee has signed a 90-day exclusive agency agreement with a seller. Upon the death of the seller, which of the following is true of the licensee's agency?
Answer: A
The agency agreement automatically terminates.
Upon the death of the seller, the licensee's exclusive agency agreement is automatically terminated, as agency relationships typically end with the death of the principal.
A) The agency agreement automatically terminates
This option is correct because agency agreements are personal contracts between the principal and the agent, and they do not survive the death of the principal. Therefore, upon the seller's death, the licensee's authority to act on behalf of the seller ceases.
B) The agency continues with the seller's heirs.
This option is incorrect because the agency agreement is specific to the original seller and does not automatically transfer to the heirs. While heirs may have the right to sell the property, a new agency agreement would need to be established.
C) The agency continues until the property is sold.
This option is also incorrect. The agency terminates upon the death of the seller and does not continue until the property is sold. The agent cannot act on behalf of the deceased seller after their death, regardless of whether the property is sold or not.
D) The agency continues until the seller's estate is settled.
This option is incorrect as well. The agency does not persist until the estate is settled; it ends immediately upon the seller's death. Any actions regarding the estate would require new agreements with the heirs or estate representatives.
Conclusion
The correct answer is that the agency agreement automatically terminates upon the seller's death, as personal agency relationships do not survive this event. All other options incorrectly suggest that the agency continues in some capacity, which is not legally supported. Therefore, the termination of the agency is the only accurate outcome in this situation.