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Real Estate · General

A salesperson is terminated by the broker. What happens to the salesperson's pending transactions?

Correct answer

The terminated agent's pending transactions are assigned to another licencee at the brokerage; the broker (as the listing/selling broker of record) remains responsible for fulfilling those transactions

  1. A All transactions are cancelled automatically
  2. B The terminated agent's pending transactions are assigned to another licencee at the brokerage; the broker (as the listing/selling broker of record) remains responsible for fulfilling those transactions
  3. C The salesperson keeps all their own transactions
  4. D The clients must restart with new agents at a new brokerage

Why this is the answer

BROKER CONTINUITY: The broker (brokerage) is the party contractually responsible for transactions — not the individual agent. When an agent is terminated: pending listings remain the broker's listings (clients can release or continue with a new agent); pending purchase transactions continue under the brokerage; clients may have the right to transfer to a new brokerage in some circumstances (especially for exclusive buyer representation agreements). The terminated agent: must immediately stop using the brokerage's name and materials; licence returns to the state in inactive status or transfers to a new broker; has no right to take the brokerage's clients or listings. Commission owed for pending transactions: per the termination agreement; varies by contract.
Source: Real Estate Broker Exam, Agent Termination and Pending Transactions

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