Brokers can be held liable for the acts or omissions of their licensees. This is known as ______.

The concept of vicarious liability is based on the principle that a broker can be held responsible for the actions or omissions of their employees or agents that occur in the course of their employment or duties. This means that if a licensee makes a mistake or engages in misconduct while performing activities related to their work, the broker can face legal consequences, even if the broker was not directly involved in those actions.

Vicarious liability emphasizes the broker's responsibility to supervise their licensees properly and ensure they are acting within the legal and ethical boundaries of their profession. This principle is crucial for maintaining trust and accountability within the real estate industry.

On the other hand, direct liability refers to situations where the broker is personally negligent or fails in their responsibilities, such as failing to provide adequate training. Negligence generally involves a failure to meet a standard of care that results in harm. Due diligence is related to the broker’s efforts to investigate and be aware of critical information before making decisions, but it does not encompass the liability aspect regarding their licensees.