What action can lead to negligence in performing licensed duties?

Demonstrated incompetence in performing required acts can lead to negligence in carrying out licensed duties because negligence is built upon the failure to exercise the standard of care that a reasonably competent professional would maintain in similar circumstances. In the context of real estate, this could involve making errors in transaction processes, failing to interpret laws correctly, or not following established practices that protect clients' interests.

When a licensed professional demonstrates incompetence—whether through lack of knowledge, skill, or proper judgment—this can result in harm to clients or the public, creating a situation where negligence is established.

The other actions, while serious, might not directly point to negligence in the same way. Failing to advertise properly may impact business but isn't necessarily a breach of duty. Neglecting to renew a license on time reflects more on compliance than on the performance of duties. Working with fraudulent parties is a significant ethical violation but does not directly relate to the competency of executing required acts. Thus, demonstrating incompetence is directly tied to negligence as it is related to the ability to perform responsibilities effectively and responsibly in real estate transactions.