An owner sells a house through a licensee who works as an independent contractor for a broker. Before the closing of the sale, the owner fires the broker. However, the owner agrees to pay the licensee a $1,000 fee for services. Which of the following is TRUE?

This choice is incorrect because an owner has the right to cancel a sales contract, especially if they are terminating their agreement with the broker. The owner retains the ability to make decisions regarding the sale of their property until the transaction is fully executed.

This statement is incorrect. The licensee cannot accept the $1,000 since their right to compensation is linked to the broker's agreement, which was terminated by the owner. Accepting payment from the owner in this context would be improper and against real estate practices.

This choice is misleading. If the broker had a valid agreement in place when the sale was initiated, they are entitled to their commission regardless of the owner's wishes following the termination—unless specified otherwise in the contract. The owner may try to refuse payment, but the broker's entitlement to commission might still be upheld legally.