Why is written documentation important for agency agreements in Maryland?

Written documentation is essential for agency agreements in Maryland because it clearly outlines the terms of the relationship between the agent and the principal, ensuring that both parties understand their rights, obligations, and expectations. This helps to prevent misunderstandings and disputes that could arise during the agency's operation. By specifying the agreed-upon terms, such as the scope of authority, duration of the agreement, and compensation, written documentation provides a clear reference point for both parties.

Additionally, this written record serves a protective function, as it can be referenced in case of any disagreements. Should a dispute arise regarding the duties or expectations of either party, having a formalized document can help to resolve these issues more efficiently and fairly, providing legal protection for both the agent and the principal.

Other options, while they mention valid points, do not encompass the full scope of importance that written documentation carries in agency agreements. Legal necessity alone does not capture its role in clarifying duties or serving as a protective measure. Similarly, while marketing tools may be used by agents, this is not the primary function of written agreements. Lastly, while these agreements might simplify agent duties to some extent by clarifying roles, the primary importance lies in outlining the terms and protecting the interests of both parties involved.