Question 72

The principal broker may accept the offer.

The principal broker has the authority to accept offers of $108,000 or more as per the limited power of attorney granted by the seller. Since the received offer of $110,000 meets this condition, the broker is empowered to accept it on behalf of the seller.

A) may not accept the offer until the seller returns

This option is incorrect because the principal broker has been given a limited power of attorney that explicitly allows for the acceptance of offers during the seller's absence. Therefore, the broker is not required to wait for the seller's return to act on the offer.

B) must forward the offer to the seller's attorney for consideration

While it is generally a good practice to inform the seller or their attorney, this option is incorrect in this context as the limited power of attorney allows the principal broker to accept offers directly without needing to consult the seller’s attorney first.

C) may accept the offer

This option is correct as the principal broker is authorized to accept any cash offer of $108,000 or more while the seller is away. The offer of $110,000 falls within this range, allowing the broker to proceed with the acceptance.

D) may sign a deed of conveyance if the seller does not return on time

This option is incorrect because the authority granted through the limited power of attorney typically does not extend to signing a deed of conveyance unless explicitly stated. The broker's authority is limited to accepting offers, not completing the transaction without the seller's further consent.

Conclusion

The principal broker can accept the $110,000 offer because it aligns with the seller's prior authorization through the limited power of attorney. The other options fail to recognize the broker's authority provided by the seller, which is the core concept being tested in this scenario. Thus, accepting the offer is both lawful and appropriate under the circumstances.