What happens to a listing agreement if the principal dies during its term?

When a principal dies during the term of a listing agreement, the agreement is automatically terminated. This is because the legal relationship and obligations established by the listing agreement are based on the principal's capacity to consent to the terms of the contract. The death of the principal removes their ability to fulfill these obligations, rendering the agreement void. In practical terms, the agent can no longer represent the deceased in real estate matters, as there is no party to uphold the agreement’s terms.

While the family may have the ability to list the property again or choose a different course of action, the original listing agreement cannot be enforced posthumously. The other choices suggest scenarios that would not occur under these circumstances, as a listing agreement does not renew automatically, cannot compel the party involved to fulfill it after the principal's death, and does not continue unless an additional agreement is put in place.