Which type of authority in a brokerage means that it's assumed based on actions?

• A. Express authority
• B. Apparent authority
• C. Implied authority
• D. Statutory authority

Answer: (C)

The correct answer is the type of authority that is assumed based on actions, which is known as implied authority. This form of authority arises not from a formal agreement but rather from the behavior or actions of the parties involved. In a brokerage context, if certain responsibilities or actions have been consistently performed by an agent in the past and those actions are understood by clients or customers as being part of the agent's role, then implied authority is deemed to exist. This allows agents to act in ways that clients may reasonably expect based on those prior actions, even if there is no explicit statement granting such authority.

Express authority specifically refers to clear, direct statements outlining what an agent can or cannot do, typically documented in written agreements. Statutory authority arises from laws or regulations governing specific activities, while apparent authority occurs when a third party reasonably assumes an agent has authority based on the actions or representations of the principal. Each of these types serves different purposes and is recognized in various contexts, but implied authority is specifically linked to the assumptions made from actions taken by the parties involved.