Definition of "Ostensible"

Mary Kay Carter real estate agent

Written by

Mary Kay Carterelite badge icon

Realty One Group Freedom

We call a concept ostensible when, at first sight, it appears to be accurate or valid. However, upon closer inspection, it proves to be a half-truth or completely false. For instance, Dale calls Harry, his childhood friend, to seemingly check in for old times’ sake. The truth, however, is that Dale wanted to convince Harry to work for him in an MLM system. Dale’s reason was ostensible as apparent.

An agent can also be ostensible. Superficially, a person might have the necessary authority or jurisdiction in a particular matter. Moreover, their physical appearance (for example, their uniform) and conduct may indicate a certain degree of control. Their authority, however, vanishes at fact-checking. After all, the definition of the term ‘ostensible’ comes down to a discrepancy between an implied idea and reality.

What does ostensible mean in terms of the law?

In law, one dealing with the agent may reasonably rely on the apparent representations.

In other words, apparent in legal terms describes the false impression of having the authority to act as a genuine agent on a client’s behalf. 

Assume the principal instructs their local real estate agents not to sell a house for less than $200,000. If they sell it for $175,000 to a buyer who has reason to rely on the agent’s actions, they will legally transfer the property. The principal may bring legal charges against and sue the real estate broker for breach of contract.

Ostensible in terms of real estate

As pointed out earlier, a realtor can seemingly assume authority and act on behalf of an agency. However, the agent doesn’t have authority on this matter.

A real estate transaction presupposes several participants. One of them can easily be perceived as an apparent agent. When you don’t have enough information available, you may jump to the reasonable conclusion that one of the parties is, by definition, an ostensible agent.

Such misunderstandings may result in civil lawsuits between house sellers and buyers and liability claims against brokers and realtors. To avoid the so-called ostensible agency liability, all parties involved should demonstrate their relationship and authority with every participant. Full disclosure of present parties should be the foundation stone for the trust between a realtor and a client!

Ostensible agency

Let’s consider Jack an independent service provider, not an employee at a significant real estate agency, such as the game-changer RealEstateAgent.com. Because he wears the company’s badge, a third party is led to believe Jack represents the agency. Jack, therefore, becomes an ostensible agent. We cannot rely upon his input, and his information may not be adequate in this context.

Real-life examples

We often encounter ostensible agency in everyday life, similar to apparent authority. Typically, a person acting as an ingenuine agent will have powerful consequences. A third party will believe an ostensible agent’s apparent authority. Thus, the third party doesn’t know the relationship between the ostensible agent and the individual or agency assumed to be the client.

Also, the definition of an 'ostensible agency' applies to the following scenario. A client hires an agency or contractor to provide them with a service. However, the company delegates a subcontractor to the customer. As the subcontractor knows the assignment’s nature and doesn’t tell the truth to the client, the customer will believe that they are dealing with a genuine contractor. The subcontractor is an ostensible agent to the contractor. 

image of a real estate dictionary page

Have a question or comment?

We're here to help.

*** Your email address will remain confidential.
 

 

Popular Real Estate Terms

As a collective noun, land cost means the total cost of purchasing a parcel of land or lot with specific land use and ownership. The land cost includes the purchase price, closing costs, ...

Small piece of carpet often placed under a door or at an entrance to a doorway. ...

Right to profit by utilizing the assets of another's land. A profit a' prendre would include the right to use and mine another's property recovering and removing any assets. ...

Right of a party, the assignor, to allocate the benefits of certain insurance policies to a third party, the assignee. Insurance on real estate may assign the policy to protect the property ...

Method of describing a real estate property offering by a developer in lieu of a prospectus. ...

Two-story house where the front door is located above the first floor but below the second floor. ...

mortgage being reduced through periodic principal and interest payments. ...

Property deed in which the grantor limits the title warranty to the grantee. A grantor does not warrant a title defect to the property occurring from a happening before the time of his ...

An opening with a hinged cover allowing access from one level to another in a structure. Often installed in a roof or the floor of a building to allow the entrance of people and materials ...

Popular Real Estate Questions