Ace the Humber/Ontario Real Estate Course 4 Exam 2025 – Unlock Your Property Potential!

The principal in an agency relationship has specific responsibilities towards the agent, and in this scenario, Seller Yang's duties to ABC Realty Inc. include taking responsibility for lawful acts carried out by the agency on their behalf and agreeing to compensate them for the services rendered. This principle is rooted in agency law, where the principal is obliged to honor the agreements made and the actions taken by the agent within the scope of their authority.

When the agency relationship is established, Yang must ensure that they support ABC Realty Inc. in fulfilling their duties, which involves covering any lawful actions taken on their behalf. This reflects a foundational concept of agency that the principal bears the results of the agent's actions when performed correctly under the agreed-upon terms. Moreover, compensation for services is a critical component of any agency arrangement, as agents typically rely on the principal to meet their financial obligations in return for their assistance and services.

Other options do not encapsulate the comprehensive nature of the principal's responsibilities. They may focus more narrowly on specific duties that are not wholly representative of the overall obligations present in an agency relationship. For instance, while indemnification is an important aspect, it is generally a part of broader fiduciary responsibilities rather than the primary duty owed at the outset of the agency.