Wisconsin Real Estate Sales Practice Exam

Which of the following is a method to mutually agree on terminating an agency?

1. Expiration

2. Death of agent

3. Breach of contract

4. Mutual consent

The correct answer is: Mutual consent

Mutual consent is a method of terminating an agency where both parties agree to end their professional relationship voluntarily. This often involves negotiation and agreement on the terms of termination, reflecting the willingness of both the agent and the principal to conclude their working arrangement for reasons that may include personal preferences or changes in circumstances that would make the continuation of the agency undesirable. The other options represent methods of termination that do not involve mutual agreement. Expiration refers to the termination of agency automatically when the contract's stated time period ends. The death of the agent leads to the dissolution of the agency relationship as it cannot be maintained without the agent. Breach of contract occurs when one party fails to fulfill their obligations, which can lead to termination but is often seen as a unilateral action rather than one based on mutual agreement. Thus, mutual consent stands out as the only option that requires agreement from both parties to terminate the agency relationship.