Final answer:
A fire destroying the property will terminate the agency relationship between a brokerage and a property owner since it makes the fulfillment of the agreement impossible. The correct answer is option B. a fire destroys the property
Step-by-step explanation:
In the context of a brokerage representing an owner for the sale of property, certain events can terminate this agency relationship. Among the options provided, the event that will terminate the agency relationship is when a fire destroys the property. According to customary agency law and often by contract, the destruction of the property renders the fulfillment of the agreement impossible, releasing both parties from their obligations. A brokerage discovering that the commission is inadequate (option A) is not a sufficient grounds for termination unless perhaps stipulated in the agreement. Similarly, engaging other brokers to assist in the sale (option C) often occurs in real estate transactions to reach a wider market and is generally allowed unless explicitly prohibited by contract. As for the owner abandoning the property (option D), unless defined in the contract, abandonment doesn't necessarily dissolve the agency relationship, as the broker could still potentially sell the property on behalf of the owner.
However, it should be noted that contractual clauses like the one referenced indicate that if either party is unable to fulfill their obligations due to the property's loss, destruction, or other circumstances preventing possession, then either party can terminate the agreement. Such a termination would be without liability to the other party, and any prepaid sums would be refunded.