Texas PL: Law of Agency Course Overview


law of agency course overview texas

Each TREC-approved real estate education program is made up of six 30-hour courses. We recommend taking the courses in this order: 

Let’s talk about what you’ll find in the Law of Agency course. If you take the courses in the suggested order, you’ve already gotten a taste of what agency is about in Principles I and II. 

In the Law of Agency course, you’ll dig much, much deeper. Here are some topics you’ll cover.

Agency Concepts 

Agency concepts cover disclosure of agency and the relationship between the principal and the agent, including:

  • Why study agency?

  • What is agency?

  • The laws that define agency in Texas

  • Distinguishing between a client and a customer

  • The relationship between the principal and the agent

Basic Agency Relationships, Disclosure, and Duties to the Client 

Here we learn the classifications of agency and get deeper into that principal-agent relationship. You’ll study:

  • The definition of agency

  • The authority an agent holds

  • Classifications of agency

  • Fiduciary duties: What are they, how do they work?

  • The Information About Brokerage Services, or IABS notice: How it provides disclosure when you have to use it.

Duties and Disclosures to Third Parties

Here you’ll learn about the duties agents have to other people in a transaction (in other words, people you’re not representing). It will also get into what you owe in terms of disclosure. Specific topics are:

  • Non-fiduciary duties

  • The general duties of honesty and fairness every agent owes every person

  • Obligations to a third party (one you are not representing)

  • Avoiding misrepresentation with correct disclosure 

  • The seller’s disclosure form (covered in Section 5.008 of the Texas Property Code)

  • Stigmatized properties

Seller Agency 

How agency works when you’re representing a seller. Specific topics:

  • Listing agreements: What are they? How do they work? What does one look like?

  • Exclusive seller agency

  • The benefits of seller agency relationships

  • Sub-agency

  • More about disclosures (disclosure will feature heavily in this course, as you can see)

Buyer Agency

This time, you’ll learn about representing a buyer. 

  • The buyer representation agreement: What is it? Why? What does it look like?

  • The creation of buyer agency and deciding to represent a buyer

  • The benefits of buyer agency relationships

  • Written notification of compensation to the broker

  • And of course, more disclosures

Representing More Than One Party in a Transaction: Intermediary Brokerage 

What if your broker is representing both the buyer and the seller? This level has answers for you. Including:

  • From dual agency to intermediary brokerage

  • More about intermediary brokerage and how it works

  • Intentional vs. accidental dual agency

Creation and Termination of Agency 

The law is super specific about how agency may be created and terminated, and this level will spell it out in excellent detail.

  • How agency is created

  • How agency is terminated

  • The duties of an agent that survive termination 

Clarifying Agency Relationships 

Okay, get ready for more disclosure because this level has plenty. Topics include:

  • Understanding a brokerage company’s disclosure policy

  • Disclosure policy in general

Employment Issues 

This level gets into lots of nitty-gritty about employment law. Part of your agency agreement with your broker clarifies whether you are an employee or an independent contractor. The difference is pretty important: It has implications for your taxes, your benefits, and your compensation. You’ll learn about:

  • Employment law generally

  • Compensation specifically

  • The relationship between a broker and an agent

  • Independent contract agreements

  • The compensation of personal assistants

  • The employment relationship between brokers and principals

Agency, Ethics, and the Law 

The law has a lot to say about what is legal for an agent to do. In addition, there are ethical guidelines that all agents should follow. As a fiduciary, you will have enhanced ethical responsibilities, and this level will get to the meat of them.

  • Laws vs. ethics vs. morals

  • Federal and state laws that pertain to agency

  • Relevant portions of TRELA

  • The Professional Code of Ethics

  • Minimum ethical standards for agents

Deceptive Trade Practices and Consumer Protection Act 

This level covers an important law called the Deceptive Trade Practices and Consumer Protection Act. It’s about (you guessed it) deceptive trade practices. For example:

  • Fraud vs. misrepresentation

  • Consumer protection from deceptive trade practices

  • Damages consumers can claim

  • Defenses from deceptive trade practices

  • Ethical and moral concerns addressed in this legislation

Implementation and Presentation 

Finally, the last level in the course will include some real-life advice and more hands-on information for your future role as an agent. Topics include:

  • Brokers working with sellers

  • Brokers working with buyers

  • Practical knowledge for everyday practice

  • Risk management

And that’s Law of Agency! It’s chock full of useful knowledge you’ll carry with you in your career. 

Want to learn more about life as a Texas real estate agent? Check out our career center.

Audrey Ference


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