Real Estate Council of Alberta Fundamentals Practice Exam

What is one method by which a representation relationship can be terminated?

1. Only by mutual agreement

2. By the expiration of a set date

3. Through one party's bankruptcy

4. Terminations cannot be mutual

The correct answer is: By the expiration of a set date

A representation relationship, such as that of a real estate agent and their client, can indeed be terminated by the expiration of a set date. Many representation agreements are established for a specific duration, and once that time period elapses, the relationship automatically ends unless it is renewed or extended. This method provides a clear and defined endpoint, which is essential in many contractual agreements to facilitate planning and expectations for both parties involved. In contracts, having a defined expiration date helps both agents and clients manage their commitments and allows either party to reassess the relationship upon completion of the term. This fosters an environment where business can be conducted efficiently, with both parties understanding when they can conclude their obligations. Other methods of termination do exist, such as mutual agreement or circumstances like bankruptcy, but the expiration of a set date is a standard and straightforward approach in real estate transactions.