Final answer:
Whether a real estate broker is considered a general or special agent depends on the scope of their authority. A general agent has broad authority over continuous business activities, while a special agent is hired for specific transactions. Most often, a real estate broker acting as a mortgage broker would be considered a special agent, limited to specific transactions unless a broader authority is granted by their principal.
Step-by-step explanation:
In the context of agency relationships, whether a real estate broker who is also a mortgage broker is acting as a general agent or a special agent depends on the nature and scope of authority granted to them.
A general agent is someone who is given the authority to perform a range of tasks related to a continuous business relationship. This agent acts on behalf of their principal in a broad array of activities within a particular business. For example, a manager of a business who is authorized to run the business on a day-to-day basis is a general agent.
A special agent, on the other hand, is appointed for a specific, limited purpose or to conduct a specific transaction or series of transactions. For instance, a real estate broker is typically considered a special agent when they are engaged to sell a particular property—they have the authority to carry out that one transaction.
If a real estate broker is acting as a mortgage broker, they would typically still be considered a special agent because they are usually authorized to assist with specific transactions, like securing a mortgage for a particular piece of real estate. However, if the broker has been granted broader authority to handle all real estate and mortgage-related activities for their principal, then they may act as a general agent.
In most cases, the distinction must be determined by examining the agreement between the principal and the agent to understand the extent of the authority granted.