What is critical in establishing an agency relationship?

The establishment of an agency relationship is fundamentally centered on the principle of consent between the parties involved, specifically the principal and the agent. Written consent from the owner is critical because it formalizes the agreement and outlines the expectations, duties, and responsibilities of both the agent and the principal. This written consent serves as a legal document that can protect both parties and clearly delineate the terms of the agency relationship.

Having a written agreement ensures that there is no ambiguity regarding the scope of the agency and helps avoid disputes that might arise if either party believes the terms were different. While verbal agreements can contribute to establishing an agency, they lack the legal enforceability and clarity that written consent provides. Additionally, reliance solely on informal verbal consent or peer approval does not constitute a legally binding relationship and can lead to misunderstandings or complications. Therefore, obtaining written consent is essential in creating a solid and enforceable agency relationship in real estate transactions.