What may the principal be liable for upon terminating a listing?

When a principal terminates a listing, they may be liable for the broker's expenses incurred up to that point. This is because real estate agents typically invest time and resources into marketing a property and conducting due diligence before a sale. These expenses can include advertising costs, travel expenses, and other operational costs that the broker has incurred while working under the listing agreement.

The listing agreement often includes terms that specify the conditions under which the broker may be compensated for expenses if the agreement is terminated. By recognizing this liability, it acknowledges the broker's right to recover costs associated with the personal investment they made while fulfilling their obligations under the agreement before its termination.

In contrast, legal fees incurred by the buyer or the costs of property appraisal typically fall outside of the principal's responsibilities unless specifically agreed upon in a separate contract or arrangement.