module 2

Question 1

Registrant’s Obligations: Information before Agreements, Section 10 of the Code

Answer 1

A salesperson is required to discuss specific information with a seller or a buyer prior to entering into an agreement
for the purpose of trading in real estate. This information is provided to assist the seller or the buyer in making an
informed decision on the type of relationship and the services they will receive based on that relationship. The
information to be provided includes:
• The types of service alternatives that are available to the seller or the buyer in the circumstances including a
representation agreement or another type of agreement. This discussion should include the difference
between a client and a customer, and how services differ in these two types of relationships. You are also
expected to explain that there could be circumstances where the brokerage may represent more than one
client in the same transaction, which would result in a change to those services.
• The services that will be provided by the brokerage and the salesperson under each agreement. Services differ
according to the nature of the agreement; the seller and the buyer must understand this to avoid any
misunderstandings at a later time.

Question 2

Registrant’s Obligations: Information before Agreements, Section 10 of the Code

Answer 2

• The fact that circumstances may arise in which the brokerage could potentially represent more than one client
in the same trade in real estate. However, a brokerage cannot do this unless all of the clients represented by
the brokerage in the trade agree and confirm their agreement in writing.
• The nature of services that the brokerage would provide to each client if the brokerage represents more than
one client in the same trade.
• The fact that circumstances could arise in which the brokerage could provide services to more than one
customer in respect of the same trade and how the services may change.
• The fact that circumstances may arise where the brokerage could be representing a client and providing
services to customers within the same trade and how the services may change.
• The difference in services that the brokerage would provide to a customer versus the services it would provide
to a client in the same trade.
• The Code requires you to do your best to obtain a written acknowledgement that this discussion has taken
place at the earliest opportunity, but at the very latest, before an offer is made.

Question 3

Contents of
written
agreements
(Section 11 of
the Code of
Ethics)

Answer 3

Any written agreement between a brokerage and a
seller or a buyer must clearly, comprehensibly, and prominently specify:
• The effective date and expiry date of the agreement. There may be only one expiry date.
• The method for calculating remuneration payable to the brokerage. In the case of an
agreement with a seller, the amount payable to any other brokerage.
• How the remuneration will be paid to the brokerage.
• The services that the brokerage will provide under the agreement.

Question 4

Copies of
written
agreements
(Section 12 of
the Code of
Ethics)

Answer 4

When a brokerage enters into a written representation or customer service agreement with a
seller or a buyer, a copy of the agreement must immediately be given to everyone who signs
the agreement. This would require a salesperson, when meeting with the parties in person, to
have sufficient copies of the agreement for all parties and the brokerage. If the agreement is
being completed electronically (by fax or email), or if the parties sign the agreement
electronically, they are deemed to have received a copy of the agreement with the generated
receipt or confirmation as evidence of transmission.

Question 5

Seller
representation
n agreements
(Section 13 of
the Code of
Ethics)

Answer 5

If a brokerage enters into a verbal agreement with a seller to represent them in the listing and
marketing of a property, the agreement must be reduced to a written document, signed by the
brokerage and submitted to the seller for signing at the earliest opportunity and before an
offer is made.
As a salesperson, you may sign a representation or a customer service agreement on behalf of
the brokerage and present it to the seller for signing. Although the Code does not require the
seller(s) to sign the agreement, in practice, a brokerage may have policies that require any
agreement with a seller to be signed prior to any marketing activity being undertaken for the
property. A seller representation agreement is also commonly referred to as a listing
agreement

Question 6

Buyer
representation
n agreements
(Section 14 of
the Code of
Ethics)

Answer 6

If a brokerage enters into a verbal agreement with a buyer to represent them in the purchase
of a property, the agreement must be reduced to a written document, signed by the
brokerage, and submitted to the buyer for signing at the earliest opportunity, and before any
offer is made.
As a salesperson, you may sign the document on behalf of the brokerage. Although the Code
does not require the buyer(s) to sign the agreement, in practice, a brokerage may have policies
and procedures relating to working with buyers and obtaining the buyers’ signatures.

Question 7

Agreements
with
customers
(Section 15 of
the Code of
Ethics)

Answer 7

If a brokerage enters into a verbal agreement with a seller or a buyer as a customer to
provide services in respect of a trade, the agreement must be reduced to a written
document, signed by the brokerage, and submitted to the customer for signing at the earliest
opportunity, and before any offer is made.
As a salesperson, you may sign this document on behalf of the brokerage. Although the Code
does not require the seller or the buyer as a customer(s) to sign the agreement, in practice, a
brokerage may have policies relating to the use of a customer service agreement. These
policies may vary depending on whether the customer is a seller or a buyer. There are distinct
service agreements used for each, as the terms relating to providing services for a trade
differ.

Question 8

Current forms
(Section 34 of
the Code of
Ethics)

Answer 8

The Code also requires that all forms used in the course of a trade are current. As legislation
can change, a brokerage must ensure all salespersons are using up-to-date forms.

Question 9

Obligation related to charging
or collecting remuneration,
per Sections 13 and 14 of the
Code and Subsection 23(1) of
O.Reg. 567/05

Answer 9

A brokerage cannot charge remuneration for a trade unless there is a
written agreement that is signed by, or on behalf of, the person who
will pay the remuneration.

Question 10

There exists, under REBBA, a provision for remuneration to be payable
where an agreement to pay remuneration is not in writing, provided
certain conditions exist. Remuneration may be payable, despite there
being no commission agreement documented, when:

Answer 10

• A salesperson has conveyed a written offer that is accepted by the seller;
• A salesperson shows a property to the buyer, who subsequently purchases the property; or

• The salesperson introduces the seller and the buyer, for the purpose of discussing the acquisition or disposition of an interest in real estate.

Question 11

when can you get remuneration despite not signing?

Answer 11

n such cases, the brokerage was the catalyst for the sale or purchase of
the property and may be able to claim remuneration.

Question 12

what is a policy of the brokerage under section 13 and 14?

Answer 12

Under Sections 13 and 14 of the Code, the salesperson, at the earliest opportunity, is required to complete the appropriate agreement, sign it on behalf of the brokerage, and present it to the party for signature.
The party is not obligated to sign the agreement. However, the Under Sections 13 and 14 of the Code, the salesperson, at the earliest
opportunity, is required to complete the appropriate agreement, sign it
on behalf of the brokerage, and present it to the party for signature.
The party is not obligated to sign the agreement. However, the

Question 13

Failing to properly document and discuss the client’s or the customer’s obligation to pay remuneration result in what ?

Answer 13

Failing to properly document and discuss the client’s or the customer’s
obligation to pay remuneration may result in an invalid agreement,
resulting in the brokerage not getting paid, detrimental impact on the
salesperson’s and the brokerage’s reputation, and disciplinary action by
RECO.

Question 14

Obligations regarding
allowable ways of calculating
remuneration (Subsections
36(1), (2), and (3) of the Act)

Answer 14

The
allowable methods include a fixed amount, a percentage of the sale
price, or a combination of both.

If there is no written agreement as to the amount, the remuneration is
then negotiated between the parties and in some cases, the courts may
be asked to intervene and determine the amount of remuneration
payable.

Remuneration cannot be based on the difference between the listing
price and the sale price of the property.

Many variations of remuneration calculations exist, with a percentage
of the sale price being the most common.

Question 15

Obligations to disclose any
direct or indirect benefit
(Subsection 18(4) of the Code of
Ethics)

Answer 15

Any direct or indirect financial benefit that a registrant, or a person
related to the registrant, may receive from another person in
connection with the services being provided by the registrant to a client
must be disclosed in writing as soon as possible. This includes any
commission or other remuneration that the brokerage may receive
from another person.

Any monetary compensation must be paid through the brokerage and
not directly to a salesperson.
Failure to disclose or obtain the client’s consent could jeopardize the
relationship and create legal liability (e.g., having to forfeit the benefit
received) for the brokerage and the salesperson

Question 16

Obligations when remuneration
is being paid to the brokerage
from more than one person for
the same trade (Subsection
18(5) of the Code of Ethics)

Answer 16

These disclosures must be made in writing at the earliest opportunity
and include:
● To the other person, the terms of the agreement with the seller or
the buyer regarding the payment of remuneration
● To the seller or the buyer, the terms of the agreement with the
other person regarding the payment of remuneration
Traditionally, remuneration is paid by a seller. However, buyers can
also be obligated to pay a brokerage remuneration under certain
conditions (see Lesson 3 for details).

Question 17

Obligations to not
indicate remuneration is
fixed or approved (Section
9 of the Code of Ethics)

Answer 17

A salesperson may not indicate to any person, either directly or
indirectly, that the remuneration is fixed. Also not permitted would be
any indication that remuneration must be approved by the
administrative authority, a government authority, or a real estate board
or association

Remuneration is negotiated with each seller and buyer and could be
based on the services the party is to receive, the location of the
property that requires additional time and distance to travel, or unique
skills required (e.g., a cottage on an island would require someone with
a Marine Operator’s License)

Question 18

Remuneration is negotiated with each seller and buyer and could be
based on the services the party is to receive, the location of the
property that requires additional time and distance to travel, or unique
skills required (e.g., a cottage on an island would require someone with
a Marine Operator’s License)

Answer 18

When a buyer is being represented by a brokerage, the buyer must be
informed of properties that meet the buyer’s criteria, without any
regard to the amount of remuneration, if any, the brokerage may be
entitled to.
This requires a salesperson to inform a buyer of all properties that
meet their criteria, regardless of the amount of remuneration offered
to the brokerage. The buyer can then make an informed decision on
whether to view the property or not, taking into consideration any
remuneration obligations they may have.

When a buyer is being represented by a brokerage, the buyer must be
informed of properties that meet the buyer’s criteria, without any
regard to the amount of remuneration, if any, the brokerage may be
entitled to.
This requires a salesperson to inform a buyer of all properties that
meet their criteria, regardless of the amount of remuneration offered
to the brokerage. The buyer can then make an informed decision on
whether to view the property or not, taking into consideration any
remuneration obligations they may have.

Question 19

Obligations regarding
remuneration when it is
known that there is an
unexpired agreement
(Subsection 33(3) of the Act
and Subsection 23(2) of O. Reg.
567/05)

Answer 19

There are regulatory requirements regarding collecting a
remuneration from a seller or a buyer who is currently under an agreement with another brokerage to pay remuneration.

Unless a
seller provides a written agreement to pay remuneration, a brokerage
is not entitled to claim remuneration from the seller for a trade in real
estate if the brokerage knows there is an unexpired listing agreement
with another brokerage.

Similarly, unless a buyer provides a written
agreement to pay remuneration, a brokerage is not entitled to claim
remuneration from the buyer for a trade in real estate if the
brokerage knows that there is an unexpired buyer representation
agreement with another brokerage

Question 20

make sure to confirm the seller is not working with another brokerage:

Answer 20

A salesperson has been contacted by a seller who is interested in listing
their property for sale. The salesperson confirms the seller is not
currently a party to a representation agreement with any other
brokerage before entering into an agreement with the seller. When the
property is sold, and the transaction is completed, the brokerage is
permitted to collect the remuneration as agreed to.

Question 21

Disclosure before multiple
representation (Section 16 of
the Code of Ethics)

Answer 21

A brokerage may not represent more than one client for the same trade,
unless the following information has been disclosed to all clients and
prospective clients, as soon as possible:
● The fact that the brokerage proposes to represent more than one
client in the same trade.
● The differences in the obligations, including the disclosure of
information or the services provided, if the brokerage were
representing only one client rather than more than one client in the
same trade

Question 22

Nature of relationship
(Section 17 of the Code of
Ethics)

Answer 22

Examples of situations where the salesperson would need to disclose the
nature of the relationship include:
● The brokerage is representing both the seller and the buyer in the
same transaction (i.e., both the seller and the buyer are clients).
● The brokerage is representing the seller as a client and is providing
services to the buyer as a customer in the same transaction.
● The brokerage is representing the buyer as a client and is providing
services to the seller as a customer in the same transaction.

In the above situations, the written disclosure is required whether it is the
same salesperson working with the seller and the buyer, or different
salespersons employed by the brokerage working with the seller and the
buyer. In addition, the seller and the buyer must be informed about how
the information shared and the services being provided by the brokerage
will now change. Information regarding the nature of the brokerage’s
services when representing more than one client for the same trade are
detailed in Lessons 2 and 3

Question 23

Inaccurate representations
(Section 37(2) of the Code of
Ethics)

Answer 23

A registrant cannot knowingly make any inaccurate representations about
the services provided. As a salesperson, you may not mislead a seller or a
buyer about the services you provide, nor could you make an inaccurate
representation in an advertisement related to your services.

Question 24

Insurance requirements

Section 11 of O. Reg. 579/05

Answer 24

All registrants must be insured under the group insurance policy arranged
and administered by RECO. This requires each brokerage, broker, and
salesperson to maintain insurance. The coverage under the policy, which
is important to explain to sellers and buyers, is the errors and omissions
and the deposit protection. When explaining and documenting the
relationship between a brokerage and a seller or a buyer, you, as a
salesperson, would advise them of the relevant insurance

When explaining and documenting the
relationship between a brokerage and a seller or a buyer, you, as a
salesperson, would advise them of the relevant insurance.

Question 25

Introduction to the Legal Obligations of a Seller and a Buyer

Answer 25

These obligations are tied to agency law, covered in Explaining Services Available to a Seller or Buyer. Typically, the obligations for seller and buyer clients are indemnification, remuneration, and anything else they agree to in writing in the agreement. Seller and buyer customers’ obligations, on the other hand, are limited to only what was explicitly contained in the agreement

Question 26

Legal Obligations of a Seller and a Buyer-Indemnification

Answer 26

As you learned earlier, a brokerage (the agent) must act according to the lawful instructions of the seller or the buyer (the principal), and in doing so, will NOT be held responsible for any liability, claim, loss, cost, damage, or injury resulting from these acts.

Question 27

obligation for a seller --Indemnification-- EX

Answer 27

Example 1: Seller Obligation A salesperson holding an open house has taken steps to safeguard the property and ensures the property is locked at the end of the event. Following the open house, the property is vandalized, and the seller suffers a loss. Indemnification would result in the brokerage not being liable to the seller for any loss

Question 28

obligation for a seller -- Indemnification-- EX

Answer 28

Example 2: Seller Obligation The salesperson, in preparing the home for the marketplace, advises the seller to secure or otherwise remove a valuable sculpture from the coffee table in the living room. The seller does not follow the salesperson’s guidance and during a showing by another salesperson, the artwork is damaged by a prospective buyer. Should the seller decide to sue the visitor and the brokerage for the cost of the sculpture, they would likely be unsuccessful because they indemnified the brokerage, and the salesperson acted responsibly. This indemnification also extends to any liability, loss, damage, etc., as a result of the property being affected by any contaminants or environmental problems.

Question 29

obligation for a seller --Indemnification-- EX

Answer 29

Example 3: Buyer Obligation A salesperson shows a property to a buyer and discusses several aspects of the property, which should be inspected by a professional. The buyer purchases the property without any additional property inspections being completed. After the transaction is completed, the buyer notices water seepage in a section of the basement being renovated that was previously not visible. Indemnification would result in the brokerage not being liable to the buyer for any loss

Question 30

obligation for a seller --Remuneration--

Answer 30

As you learned earlier, a seller or a buyer (the principal) is obligated to compensate the brokerage (the agent) for the services agreed to and provided under an agreement. The brokerage’s remuneration must be specified in the agreement and the terms fully met by the brokerage for the obligation of remuneration to apply.

Question 31

obligation for a seller --Remuneration-- EX

Answer 31

Example 1: Seller Obligation A seller agrees to pay the brokerage a remuneration rate of 2% of the sale price of the property. During the listing period, the seller accepts an offer and the transaction closes. Remuneration would result in the seller compensating the brokerage as agreed to in the listing agreement.

Question 32

obligation for a seller --Remuneration-- EX

Answer 32

Example 1: Seller Obligation A seller agrees to pay the brokerage a remuneration rate of 2% of the sale price of the property. During the listing period, the seller accepts an offer and the transaction closes. Remuneration would result in the seller compensating the brokerage as agreed to in the listing agreement.

Question 33

obligation for a seller --Remuneration-- EX

Answer 33

Example 2: Buyer Obligation A buyer agrees the brokerage should receive a remuneration rate of 2.5% of the sale price for any property purchased during the term of their agreement. The buyer purchases a property where the brokerage is being compensated 1.5% of the sale price by the seller. Remuneration would result in the buyer compensating the brokerage for the additional 1% of the sale price as agreed to in the agreement. The seller is obligated to compensate the brokerage if they bring the seller a valid agreement of purchase and sale even after the expiry of the agreement, for anyone introduced to the property during the listing period, based on the holdover provision in the agreement. You will learn more about this later in the module.

Question 34

Additional obligations | specifically agreed to-- Seller Obligations

Answer 34

Seller Obligations A. The seller agrees to pay remuneration as agreed to if an accepted agreement of purchase and sale is not completed due to the seller’s default or neglect.

Question 35

Additional obligations specifically agreed to ---obligation for a seller -- EX

Answer 35

Example 1: A seller accepts an offer and the transaction is scheduled to close in one week. The seller advises the brokerage they no longer want to sell their property. Based on the other obligations agreed to, the seller would be required to compensate the brokerage the agreed-upon remuneration should the seller not proceed with the transaction

Question 36

Lesson 2: The Seller Representation Agreement

Answer 36

Lesson 2: The Seller Representation Agreement

Question 37

Lesson 2: The Seller Representation Agreement

Answer 37

Upon completion of this lesson, the learner will be able to: • Identify the types of listings • Describe the type of information required to identify the terms of, and parties to, a seller representation agreement • Explain what a seller typically acknowledges and consents to in a seller representation agreement • Explain what a seller typically warrants in a seller representation agreement • Explain how to document remuneration in a seller representation agreement • Explain the additional information typically included in a seller representation agreement • Explain the signing and initialling requirements of a seller representation agreement • Complete the information required to identify the terms of, and parties to, a seller representation agreement • Complete the additional information typically required in a seller representation agreement • Complete the signing and initialling requirements of a seller representation agreement

Question 38

Introduction to Types of Listings

Answer 38

1-Exclusive 2-Listing Service 3-Open 4-

Question 39

what is an Exclusive listing ?

Answer 39

In an exclusive listing, the seller gives the sole right to market and sell their property to one brokerage. The brokerage is authorized by the seller to sell their property during the time specified in the agreement and on the terms agreed to. Only the brokerage with whom a seller has signed an exclusive agreement is authorized to show the property to potential buyers and the property would typically not be advertised on a listing service. In some instances, after the listing agreement has been signed, the seller may agree to allow the brokerage to cooperate with another brokerage. However, this requires specific permission from the seller. Typically, a seller and a brokerage agree to an exclusive listing because the seller has given specific instructions regarding the showing of the property that the brokerage must follow. As many times an exclusive listing could be priced at the higher end of values for the trading area, this could include pre-qualifying any potential buyer before viewing the property Sellers may request tighter control over showing the property to protect their privacy and to ensure buyers are qualified and not merely curious. One consideration with an exclusive listing is that by restricting the authority to sell the property to the listing brokerage, buyers working with other brokerages may not know of the property’s availability and miss the opportunity to view and purchase the property

Question 40

Listing Service

Answer 40

A listing service is a member-only database that provides access to properties that are available for sale or lease. A property may be placed on a listing service (e.g., a multiple listing service through a local real estate board) if a seller wants wider exposure to more potential buyers. This form of listing is the most common. The authority to list is granted to only one brokerage. However, the seller permits the listing brokerage to co-operate with other brokerages in the sale of the property A co-listing or shared listing is where a seller signs a representation agreement with two or more brokerages at the same time. There is only one listing but two or more brokerages share the responsibilities and the remuneration. This does not happen very often but can be encountered when there are multiple owners and they each want their own representation. A good example is a separation or divorce.

Question 41

Open listing

Answer 41

An open listing or “For Sale By Owner” is when a seller does not list their property with any brokerage, however, the seller is willing to allow any brokerage to show the property to a buyer An open listing often is identified by a sign on the property, stating “Brokers Protected.” This sign means the seller will co-operate with any brokerage and will compensate the brokerage who first acquires a buyer ready, willing, and able to meet the terms of the listing or secures the acceptance by the seller of a satisfactory offer Typically, an agreement to pay remuneration is signed between the brokerage and the seller rather than a representation agreement. As such, the seller is not a client and the brokerage does not owe the seller any fiduciary obligations. Open listings are usually seen in transactions involving office, retail, or industrial properties

Question 42

Introduction to a Seller Representation Agreement

Answer 42

In addition to documenting the seller and property information, a representation agreement will contain additional information, such as: • The services the brokerage will provide under the agreement • The seller’s obligations for indemnification and remuneration • The brokerage’s obligations • The brokerage’s actual authorities • The limitations to the brokerage’s authority

Question 43

seller representation agreement should include:

Answer 43

* Listing agreement type * Brokerage details * Seller(s) details * Address for listed property * Effective and expiry dates for the agreement, and the six-month provision * Listing price * Seller’s representation and warranty

Question 44

listing agreement - Seller(s) Details

Answer 44

- The legal name(s) of all registered owners of the property are identified. Only the name(s) listed on the title have authority to sell the property

Question 45

who can sigh on the listing agreement?

Answer 45

If the seller is an individual, use their full legal name as registered. If the seller is an incorporated company, business, or partnership, the registered name would be indicated as the owner. Under these circumstances, you must verify the individual signing has the authority to sign on behalf of the entity.

Question 46

spousal consent is obtained?

Answer 46

A non-titled spouse is not identified as a seller. Obtaining spousal consent is required for the sale of a matrimonial home (as per the Family Law Act). Spousal consent is obtained further in a seller representation agreement, where the seller signs

Question 47

Effective and Expiry Dates for the Agreement, and the Six-Month Provision?

Answer 47

In compliance with the Code of Ethics, a representation agreement must include the date on which the agreement takes effect and the date it expires. The seller needs to be aware of the time period for which they will be bound by the agreement.

Question 48

when can two listing commence with a brokerage ?

Answer 48

A new listing should not commence with a brokerage before a current listing expires, as this would obligate the seller to two brokerages should the property sell during this time period. However, if the property is being listed for sale as well as being offered for lease, two separate listings would be appropriate.

Question 49

Listing Price in the listing agreement

Answer 49

The listing price is identified in both words and figures.

Question 50

Seller’s Representation and Warranty on the listing agreement ?

Answer 50

The seller’s representation and warranty are included to ensure the seller does not currently have the property listed with another brokerage or have any agreement to pay remuneration to any other brokerage. A leading practice is to ensure that the seller does not list their property with more than one brokerage at the same time, as this could obligate the seller to pay remuneration to more than one brokerage. The seller’s initials are obtained next to the statement to ensure the seller has read and understood this term of the agreement.

Question 51

what are the type of information required to identify the terms and parties in a seller representation agreement?

Answer 51

1. Listing Agreement Type: OREA Form 200 contains a section at the top that lets the seller choose between listing their property as an exclusive listing or through a listing service. The seller indicates their choice by initialing the applicable option. This section identifies the seller’s decision regarding the type of listing they want. 2. Brokerage details: OREA Form 200 contains a line where the registered name of the brokerage will be entered, and the telephone number will also be provided. They are then referred to as “Listing Brokerage”across the agreement.This section contains the brokerage’s full registered name and contact details. 3. Seller(s) details: OREA Form 200 contains a line where the legal name of the authorized seller will be entered. They are then referred to as “Seller” throughout the agreement.Legal name(s) of all registered owners of the property are identified in this section. 4. Address for listed property: OREA Form 200 contains an area to include the property’s address or legal description. Complete address is added after verification for listing of the property in this section. 5. Effective and expiry dates for the agreement, and the six-month provision: OREA Form 200 contains an area to enter a commencement date and an expiry date. The OREA form also contains a section that provides details about how the listing duration is negotiable between the seller and the listing brokerage. This section includes the date on which agreement takes effect and the date it expires and the six-month provision. 6. Listing price: OREA Form 200 contains a line where the listing price for the property being listed is entered. The listing price is entered in both words and numbers on the agreement 7. Seller’s representation and warranty: OREA Form 200 contains a section in bold type on the first page, which mentions that the seller’s warranty with respect to an unexpired listing agreement is intended to protect both seller and the brokerage with respect to remuneration. In this section, the seller warrants that they have not currently listed the property with another brokerage or have any pending remuneration to pay to any brokerage.

Question 52

Introduction to Additional Information Typically Included in a Seller Representation Agreement

Answer 52

Introduction to Additional Information Typically Included in a Seller Representation Agreement

Question 53

Documenting Remuneration

Answer 53

The following screens highlight the information you require to understand the seller’s obligation to pay remuneration and how it needs to be documented in the agreement: • Definitions and interpretations • Remuneration • Holdover provision

Question 54

Definitions and Interpretations in the seller representation agreement

Answer 54

A seller representation agreement has a “definitions and interpretations” clause to establish and explain the terms used in the agreement. The clause defines terms such as seller, buyer, real estate board, and other terms that are synonymous with/have a common function within the agreement. For example, seller also means vendor.

Question 55

Remuneration-in the seller representation agreement

Answer 55

When explaining an agreement, the seller must fully understand their obligations to pay remuneration to the brokerage. The amount of remuneration owed is negotiable between the seller and the brokerage and is based on the services being provided by the brokerage under the agreement. REBBA identifies the allowable ways a remuneration can be calculated: • A percentage of the sale price • A flat fee • A combination of both

Question 56

Holdover Provision

Answer 56

Within the commission clause is a provision stating the brokerage is entitled to remuneration if a buyer is introduced to, or shown, the property during the listing period and purchases the property during an identified time period following the expiration of the listing. This is known as the holdover period and is a reasonable time-period negotiated between the seller and the brokerage that begins immediately upon the representation agreement expiring. The holdover period allows the listing brokerage to claim a remuneration in cases where a seller and a buyer negotiate the sale of the property during this time period. The buyer must be introduced or shown the property during the listing period for the holdover period to apply to that sale.

Question 57

Holdover Provision - example

Answer 57

Example 1: A seller lists their property with Brokerage A and agrees to pay a remuneration rate of 5%. A buyer is shown the property during the term of the listing agreement but does not purchase the property. The listing expires and there is a 90-day holdover period that is now in effect. During this time, the seller does not list their property for sale with any brokerage; however, the seller accepts an offer from the buyer who was previously introduced. The seller is obligated to pay the full remuneration rate of 5% to Brokerage A, as agreed to in the representation agreement.

Question 58

Holdover Provision - example

Answer 58

Example 2: A seller lists their property with Brokerage A and agrees to pay a remuneration rate of 5%. A buyer is introduced to the property during the term of the listing agreement but does not purchase the property. The listing expires and a 90-day holdover period is now in effect. During this time, the seller lists their property for sale with Brokerage B and agrees to pay a remuneration rate of 4.5% commission. If the buyer previously introduced to the property purchases it during the holdover period, the seller is obligated to pay commission as follows: • 4.5% to Brokerage B • 0.5% to Brokerage A A seller must have a clear understanding of their obligations for remuneration, both during the active period of the listing agreement and the holdover period

Question 59

what does holdover period means plainly ?

Answer 59

3. Holdover Provision: Within the Commission clause, OREA Form 200 contains information about the holdover period. This section contains a provision under which the brokerage is entitled to remuneration.

Question 60

what is the the client’s obligation towards the | brokerage:

Answer 60

* Representation * Multiple Representation * Finders Fee * Referral of Enquiries * Marketing * Warranty * Indemnification and Insurance * Family Law Act (spousal consent) * Verification of Information * Use and Distribution of Information

Question 61

Finders Fee

Answer 61

This clause functions as both an acknowledgement and a consent for the listing brokerage to receive and retain a finder’s fee from a third party in addition to the remuneration being paid. A written disclosure must still be completed when the finder’s fee is being received, as this clause does not provide the required details for that disclosure (in accordance with Subsection 18(4) of the Code).

Question 62

Referral of Enquiries

Answer 62

A seller must notify the brokerage immediately of all enquiries about the property during the listing period, no matter who has made the enquiry. If the seller receives an offer submitted directly to them, the seller is obligated to provide the offer to the brokerage before accepting or rejecting the offer. If the seller accepts an offer during the listing period or the holdover period without notifying the brokerage, the seller is obligated to pay the remuneration as stated in the agreement, within five days of the brokerage’s request.

Question 63

Marketing

Answer 63

The seller typically gives consent for the listing brokerage to do the following: • Show and permit prospective buyers to inspect the property fully •The sole and exclusive right to place a “For Sale” and a ”Sold” sign on the property • The exclusive right to include information in any advertising that may identify the property, such as a photo or address • The sole and exclusive authority to make advertising decisions about the property during the course of the agreement • The listing brokerage will not be held liable for acts or omissions with respect to advertising the property by the brokerage or any other party other than by the brokerage’s gross negligence or wilful act

Question 64

Warranty

Answer 64

This clause provides the brokerage with the seller’s warranty that the seller has the exclusive authority and power to offer the property for sale. The seller must inform the listing brokerage about third-party interests or claims concerning the property that may affect the sale. This would include any rights of first refusal, options, easements, mortgages, or encumbrances. Example: A seller discloses to the listing salesperson an easement located on the property that provides access to a lake for the adjoining property. This easement is included in the listing information, so any prospective buyer is made aware of its existence.

Question 65

Indemnification and Insurance

Answer 65

As you learned earlier, indemnification is a key legal obligation a seller owes to a brokerage. It is important that this clause is included in a seller representation agreement and explained to the seller. The clause identifies the seller will not hold the brokerage liable for any damage or loss to the property and its content during the term of the agreement unless there is gross negligence or a wilful act by the brokerage. The seller will also indemnify the brokerage, all salespersons, and any co-operating brokerage from any liability, claim, loss, cost, damage, or injury caused or contributed to by any breach of a warranty or representation made by the seller in the listing agreement or data form used to collect the property information used for the listin

Question 66

Indemnification and Insurance -Example 1:

Answer 66

A salesperson explains the seller’s obligations for disclosure of any known latent defects. The seller states there are no known problems that must be disclosed, and the brokerage documents this. However, the buyer discovers a serious water leak in the basement after moving in and sues the seller, the salesperson, and the brokerage. In this case, the seller may be liable to the brokerage for any losses they may suffer as a result of the seller’s nondisclosure.

Question 67

Indemnification and Insurance -Example 2:

Answer 67

Example 2: An open house is attended by many people at the same time. The salesperson is unable to keep track of all the attendees and learns from the seller that an expensive statue has been stolen from the property. In this situation, the brokerage could be considered liable for not taking steps to protect the property, such as limiting the number of people in the home at the same time, insisting that all guests identify themselves and sign a guest register, and advising the seller to remove all valuables during the public open house. That said, if the salesperson secures the property both during and after the open house, and despite their caution the house is broken into, the seller would be required to indemnify the brokerage against any loss.

Question 68

Family Law Act (spousal consent)

Answer 68

A seller representation agreement will address situations where spousal consent is required. As detailed under a previous module, the Family Law Act provides a non-titled spouse possessory rights to a matrimonial home. This means the non-titled spouse has the right to possess the property. This is a personal right and is not an interest in the land.

Question 69

Verification of Information

Answer 69

A seller representation agreement provides authority to the brokerage to verify information, whether provided by the seller or obtained elsewhere by the brokerage. This authority extends to obtaining information affecting the property from relevant regulatory authorities such as governments, mortgagees, etc. Example: The seller has misplaced their current tax bill and is uncertain about the amount of tax they paid last year. The seller authorizes the salesperson to contact the local municipal office to obtain and verify the information on the seller’s behalf.

Question 70

Use and Distribution of Information

Answer 70

This provision is included in a seller representation agreement to ensure the brokerage complies with privacy laws. The seller’s consent is required to allow the listing brokerage to collect, use, and disclose any information for the purpose of marketing the property. This also includes the use of photographs, surveys, floor plans, virtual tours, etc. If the listing is placed on a local listing service, the seller also consents to the sale information being posted into the database, and this information may also be shared with other parties approved by the local listing service. This could include any other brokerage, third-party service professionals such as an appraiser, government departments, and municipal organizations. In the case where information is stored on databases located outside of Canada, the listing agreement identifies the information would be subject to the laws of the jurisdiction in which the information is located.

Question 71

Additional Information Included in a Seller Representation Agreement

Answer 71

``` The following screens will highlight the additional information typically included in a seller representation agreement: • Successors and assigns • Conflict or discrepancy • Electronic communication • Electronic signatures • Schedule(s) ```

Question 72

Seller’s Consent and Warranty, 1

Answer 72

The background shows a thumbnail for page 2 of OREA Form 200: Listing Agreement. This page includes the following sections: 1. Representation: OREA Form 200 contains a clause where the seller acknowledges that the listing brokerage provided the seller with information explaining agency and customer service relationships. This section identifies the requirement for the salesperson to fully disclose the service options available and the types of representation that could occur. 2. Multiple Representation: OREA Form 200 contains a clause about the possibility of multiple representation arising. This section of the form outlines to the seller the fact that the brokerage could enter into multiple representations. 3. Finders Fee: OREA Form 200 contains a clause that addresses finder’s fees paid to the brokerage. This section outlines the seller’s acknowledgement and a consent for the listing brokerage to receive and retain a finder’s fee from a third party apart from remuneration payable. 4. Referral of Enquiries: OREA Form 200 contains a clause that the seller will inform the brokerage immediately about any enquiries that are made directly to the seller. This section outlines the seller’s requirement to notify the brokerage immediately about all enquiries about the property during the listing period. 5. Marketing: OREA Form 200 contains a clause that allows the brokerage to market the property. This section outlines the clause that provides authorities to the brokerage to market the property appropriately.

Question 73

Seller’s Consent and Warranty, II

Answer 73

The background shows a thumbnail for page 2 of OREA Form 200: Listing Agreement. This page includes the following sections: 1. Warranty: OREA Form 200 contains a clause the seller warranties. This section contain a clause that is used to ensure that the seller will provide the listing brokerage with information on third-party interests or claims about the property. 2. Indemnification and Insurance: OREA Form 200 contains a clause relieving the brokerage of any damage or loss to the property. This section contain a clause that is used to ensure that the seller does not hold the brokerage liable for any damage or loss to the property and its content during the term of the agreement, unless there is gross negligence or a wilful act by the brokerage. 3. Family Law Act: OREA Form 200 contains a clause regarding the need for spousal consent. This form also contains a section on the last page for the signature of the non-owner spouse to grant spousal consent. This section contain a clause that is used to confirm that spousal consent is not necessary, unless the spouse of the seller has signed the consent provided later in the agreement. 4. Verification of information: OREA Form 200 contains a clause where the seller authorized the brokerage to verify information about the property. This section contain a clause that is used to provide authority to the brokerage to verify information about the seller(s) and the said property. 5. Use and Distribution of Information: OREA Form 200 contains a clause stating that the brokerage will comply with privacy laws. This section contain a clause that is used to ensure that the brokerage complies with privacy laws.

Question 74

holdover period better explained:

Answer 74

It’s not uncommon that a listing agreement between a real estate agent and a seller include a “holdover period”. This clause states that the seller is liable to pay the commission to the real estate agent should the property sell within ‘x’ number of days after the listing agreement concludes, provided that the buyer was introduced to or saw the property during the listing period. An agent who puts in a lot of time and effort wants to be protected should a buyer decide to make an offer shortly after the listing agreement expires. A recent Ontario Court of Justice decision upheld the holdover period clause after the seller attempted not to pay the real estate agent’s commission.

Question 75

Conflict or Discrepancy

Answer 75

If something is added to the agreement that conflicts with any pre-printed portion of the seller representation agreement, then the added part supersedes the pre-printed portion.

Question 76

Electronic Communication

Answer 76

In today’s marketplace, technology plays an important part in the communication between sellers and brokerages. Many times, communication is done electronically, such as through email or fax. This provision identifies that any communications may occur electronically, and the signatures are deemed to be original. The clause also states that if the seller transmits the agreement electronically to the brokerage, it is deemed the seller has retained a true copy of the agreement.

Question 77

Electronic Signatures

Answer 77

If the seller and the brokerage wish to sign the seller representation agreement electronically, this clause provides the consent to do so. Including such a provision in a seller representation agreement identifies if the agreement has been signed electronically, and the parties have consented, pursuant to the Electronic Commerce Act. Consent is only granted for this agreement. Any additional documentation signed by an electronic signature will require a separate ©2019 Real Estate Council of Ontario clause indicating the parties have consented.

Question 78

Schedule(s)

Answer 78

If any terms or documents are added to a seller representation agreement, schedules can be used. The schedules attached to the agreement should be identified on the agreement to ensure no documentation is misplaced. The schedule should contain cross-references to the original seller representation agreement, such as the address of the property, the name of the seller, the name of the brokerage, and the listing date The seller and listing brokerage should initial each schedule and these schedules should be attached to the listing agreement in a sequential order, for example Schedule A, Schedule B, e

Question 79

Schedule(s) -- EXAMPLE

Answer 79

Example: A seller has been negotiating the private sale of her property with a neighbour for some time. The neighbour cannot decide whether they want to purchase the property, so the seller has decided to list the property with a brokerage. The seller is concerned the neighbour will suddenly decide to purchase the property now that it is listed for sale, and does not want to pay remuneration if this occurs within a specified time period. If the brokerage agrees to these terms, this buyer can be excluded from the listing agreement by either inserting a clause in the internal remarks area or adding a schedule to the agreement detailing the terms of the excluded buyer arrangement.

Question 80

``` The following screens will highlight the additional information typically included in a seller representation agreement: • Successors and assigns • Conflict or discrepancy • Electronic communication • Electronic signatures • Schedule(s) ```

Answer 80

1. Successors and assigns: OREA Form 200 contains a clause that addresses that the seller’s legal representatives will fulfill the transaction in the event the seller dies. This section outlines that if the party to a contract is incapable of closing the transaction for a variety of reasons, this clause requires that their lawful representatives act on their behalf to complete the transaction. 2. Conflict or discrepancy: OREA Form 200 contains a clause to address the circumstances where an addition is made to the contract and it conflicts with a pre-set clause within the agreement. This section outlines the clause used to ensure that an added part of a seller representation agreement supersedes the pre-printed portion. 3. Electronic communication: OREA Form 200 contains a clause to address the use of electronic communications. This section outlines thee clause used to make the seller aware that any communication may occur electronically, and the signatures are deemed to be original. 4. Electronic signatures: OREA Form 200 contains a clause that addresses the use of electronic signatures. This section outlines the clause used to provide the seller and brokerage consent if they wish to sign the seller representation agreement electronically. 5. Schedule(s): OREA Form 200 contains a clause that ends with the following: “…attached hereto form(s) part of this Agreement.” This section outlines the clause that is inserted in the event that if any terms or documents are added to the seller representation agreement, schedules can be use

Question 81

Introduction to the Signing and Initialling Requirements in a Seller Representation Agreement

Answer 81

The seller will also be asked to sign an acknowledgement indicating they have received a copy of the agreement. This will ensure that you have complied with your obligation to immediately provide a copy to the party signing. The following screen explains the specifics of the signing and initialling requirements in a seller representation agreement.

Question 82

The seller will also be asked to sign an acknowledgement indicating they have received a copy of the agreement. This will ensure that you have complied with your obligation to immediately provide a copy to the party signing. The following screen explains the specifics of the signing and initialling requirements in a seller representation agreement.

Answer 82

``` The following screens will highlight the signing and initialling requirements of a seller representation agreement: • Signature – brokerage • Signature – seller • Spousal consent signature • Initialling • Declaration of insurance • Acknowledgement ```

Question 83

Declaration of insurance

Answer 83

As required under REBBA and detailed earlier, a salesperson, a broker, or a broker of record working with the seller must inform the seller that they are insured under the RECO insurance program. A signature is obtained on the seller representation agreement to indicate this declaration of insurance has been done.

Question 84

Signing and Initialling

Answer 84

The background shows a thumbnail for page 3 of OREA Form 200: Listing Agreement. This page includes the following sections: 1. Signature – brokerage: OREA Form 200 contains a clause binding the brokerage to the agreement. This section of the form binds the brokerage to the agreement. 2. Signature – seller: OREA Form 200 contains a clause binding the seller to the agreement. This section of the form binds a seller to the terms of the agreement and acknowledges that they have read, understood, and agreed to those terms. 3. Spousal Consent: OREA Form 200 contains a spousal consent clause. This section of the form is to ensure spousal consent when there is a non-titled spouse and the property being listed for sale is a matrimonial home. 4. Initialling: OREA Form 200 contains a space for the initials of the parties on every page, except the signature page. This section of the form requires initials by the sellers, which indicates whether the sellers consent to allow other real estate board members to contact them after expiration or other termination of the agreement to discuss listing or otherwise marketing the property. 5. Declaration of Insurance - Form 200: Registrants must inform sellers and buyers in writing, as soon as practically possible and prior to entering into an agreement, of whether they are in compliance with REBBA, 2002 insurance requirements. Form 200 contains a section whereby the salesperson, broker, or broker of record, by signing, confirms to a seller that the salesperson, broker, or broker of record is insured under the RECO insurance program. 6. Acknowledgement: OREA Form 200 contains a clause where the seller acknowledges they understand the terms of the agreement and that they received a copy. This section of the form is where the seller acknowledges that they have understood the terms of the agreement and they have received a copy of the agreement.

Question 85

Buyer Representation Agreement

Answer 85

While there are several similarities between a seller representation agreement and a buyer representation agreement, there are also some differences between the two. The major difference is that the seller representation agreement gives the brokerage the authority to sell the subject property. However, the buyer representation agreement must describe the general details of a property that will be acceptable to a buyer in a specific geographic area. These items are covered in both agreements. The remainder of the documents are generally quite similar. Differences include provisions related to indemnification and the consumer reports included as part of the additional information in the agreement. The following screens will highlight the type of information required to identify the terms of, and parties to, a buyer representation agreement: • Buyer’s details • Property type • Geographic location • Buyer representation/warranty

Question 86

describing the type of property

Answer 86

single family residential home

Question 87

what is referral property ?

Answer 87

A buyer representation agreement contains a provision that requires the buyer to inform the brokerage of any property they become aware of that meets the criteria as identified in the agreement.

Question 88

Indemnification

Answer 88

A provision for indemnification in a buyer representation agreement is the buyer’s acknowledgement that the brokerage and its representatives are not responsible for any defects found in the properties the buyer views. Although the brokerage and its representatives are trained in dealing in real estate, they are not qualified to determine the physical condition of the properties or land. You should not advise a buyer about the physical condition of a property and, if asked, should refer them to a professional

Question 89

Schedule(s)

Answer 89

Schedules to a buyer representation agreement could include: • A list of properties that may be excluded from the buyer representation agreement; for example, the buyer may have viewed a property for private sale or a new home construction site by a builder • A pre-approval letter from a mortgage provider to assist in the brokerage assessing the buyer’s qualification

Question 90

definiton

Answer 90

1. Indemnification: OREA Form 300 contains a provision where the buyer states that the brokerage is not responsible for any defects in the properties the brokerage identifies for the buyer. This section informs the buyer that the brokerage and its representatives are not responsible for any defects found in the properties the buyer views. 2. Consumer reports: OREA Form 300 contains a provision where the buyer acknowledges that a consumer report, consisting of personal and credit information may be used during the process. This section notifies the buyer that a consumer report, consisting of their personal and credit information, may be used and referred to during the transaction. 3. Schedule(s): OREA Form 300 contains a line that refers to schedules that form part of the agreement. This section indicates any attached schedules.

Question 91

holdover with good examples

Answer 91

Example 1: On the expiry of the buyer representation agreement and during the holdover period specified in the agreement, a buyer puts an offer on a property that was introduced to him by the brokerage prior to the expiration of the buyer representation agreement. The buyer purchases the property without entering into another buyer representation agreement with another brokerage. In this case, the buyer owes the agreed-upon remuneration to their brokerage. Example 2: The buyer’s agreement with a brokerage expires and, during the holdover period, he signs an agreement with another brokerage. The buyer purchases a property through the new brokerage; however, the property had been introduced to the buyer by the previous brokerage. As the purchase occurred during the holdover period, the buyer is obligated to pay remuneration to the previous brokerage. However, the buyer’s obligation for remuneration is reduced by the amount paid under the new representation agreement, if any.

Question 92

Declaration of insurance

Answer 92

It is the salesperson’s declaration that they have insurance as required under REBBA. The Declaration of Insurance when signed by the salesperson confirms that they are enrolled in the RECO Insurance Program as required by the Real Estate and Business Brokers Act, 2002.

Question 93

what is a non-exclusive disclaimer ?

Answer 93

a seller customer service agreement is a non-exclusive agreement with the brokerage. This means a seller can have a customer service agreement with any number of brokerages at the same time. The seller’s obligation to pay remuneration is to the brokerage that introduces the buyer whose offer is accepted by the seller. A seller customer service agreement also includes a warranty statement that the seller has not listed the property with any brokerage for sale or lease under a seller representation agreement. The seller’s initials are required by this statement to confirm the seller has understood this term

Question 94

what is the difference between the buyer customer service and buyer representation agreement

Answer 94

remuneration and representation and customer service

Question 95

Lesson 6

Answer 95

Altering the Terms of a Representation or a Customer Service | Agreement

Question 96

what is an amendment

Answer 96

An amendment is used to make changes to the previously agreed upon terms between the brokerage and the seller. The two most common amendments pertain to a change in the listing price and a change to the expiry date of the agreement. This could include changes such as: Including additional services provided by the brokerage – for example, additional open houses will be held ● Revising the right to place a “For sale” or “Sold” sign on the property – for example, the original listing does not permit the brokerage’s sign; however, the seller later agrees to permit signage ● Correcting information – for example, a previously undisclosed first right of refusal has now come to light ● Revising remuneration terms – for example, a seller wishes to increase the remuneration payable to a cooperating brokerage ● Revising other terms – for example, chattels and fixtures that may be added or deleted

Question 97

what is an amendment

Answer 97

An amendment is used to make changes to the previously agreed upon terms between the brokerage and the seller.

Question 98

can a sale person sign for an amendment?

Answer 98

yes

Question 99

Amendment to a Buyer Representation Agreement

Answer 99

An amendment will likely be used to: • Include additional services that the brokerage might provide to the buyer. • Revise the property-type or geographic location. • Revise the terms of any remuneration obligations of the buyer. • Revise the expiry date of the agreement – buyer’s initials required if the new expiry date is more than six months after the commencement date. • Make corrections to information recorded in the agreement.

Question 100

Cancellation of a Buyer Representation Agreement

Answer 100

To cancel a buyer representation agreement, signatures of the buyers and the broker of record or manager are required to cancel the agreement. A salesperson cannot execute the cancellation on behalf of the brokerage

Question 101

Brokerage’s Obligations to Maintain Business Records

Answer 101

• Retaining all documents and records created during the course of a trade for at least six years: If a brokerage has files relating to a contentious trade (which may result in a lawsuit or other legal action), the brokerage should store those documents indefinitely. These could include any relationship agreements that are created along with schedules or any changes that are made to the terms of these agreements • Maintaining records for other activities required to conduct the brokerage’s business: These could include documents such as records of trust money transactions, monthly reconciliations, records of trust property, accounting records, employee records, etc. •Retaining documents at the appropriate location: For a brokerage that does not have any branch office, all documents should be retained at the brokerage’s main office. If the brokerage does have a branch office, records are retained at the location specified by the Registrar or, if the Registrar hasn’t specified a location, at the main office of the brokerage. If a brokerage does operate out of branch offices and records are to be kept at the main office, then all documents created at a branch office should, as soon as possible, be moved to the main office.

Question 102

The documentation required from a salesperson, in addition to representation agreements and customer service agreements, may include:

Answer 102

* Surveys or other information related to the listing * Identification verification of the seller or the buyer as required by FINTRAC * Disclosures from sellers about any issues with their property, repairs conducted on the property, etc.

Question 103

Inducements to Sell

Answer 103

Promises include that the salesperson or any other person will: • Buy any of the seller’s real estate. • Acquire a mortgage, an extension of a mortgage, a lease, and/or an extension of a lease for the seller. • Buy or sell a mortgage or acquire a loan for the seller.

Question 104

Inducements to Buy

Answer 104

Inducements to Buy Promises include that the salesperson or any other person will: • Sell, lease, or exchange the real estate. • Buy or sell any of the buyer’s real estate. • Acquire a mortgage, an extension of a mortgage, a lease, and/or an extension of a lease for the buyer. • Buy or sell a mortgage or acquire a loan for the buyer.

Question 105

Mistakes a Salesperson Should Avoid While Documenting Relationships: Documentation errors

Answer 105

• Failing to carefully obtain, read, and analyze source documents. Examples when working with a seller include reviewing a survey, maintenance records, tax bill, deed, lawyer’s reporting letter, and other documents a salesperson can refer to in order to obtain information that would be part of a listing agreement. • Transposing information from source materials to the representation agreement. • Making errors with regard to documenting specifics of the land, property, and defects (for example, lot dimensions are misstated, easements and local improvement charges are overlooked). • Failing to ensure that all parties on title appear and sign the listing agreement or any other document. • Failing to enquire about the requirement to obtain spousal consent.

Question 106

Incorrect words, statements, and predictions

Answer 106

• Making statements to a seller or a buyer with regard to a transaction that advance opinions or promote comparisons, and using exaggerations such as “best property,” “greatest return,” etc., and not stating only the facts.

Question 107

Misrepresentation

Answer 107

• Failing to seek confirmation that the client or customer fully understands what is being shared with them with regards to the services provided by the brokerage, the obligations of the brokerage, and the obligations the client or the customer owes to the brokerage. • Failing to defer to other professionals, such as a home inspector, a lawyer, or an insurance broker when appropriate. • Exceeding the scope of authority granted by the client. • Not properly addressing issues during negotiations with sellers and buyers. Examples include failing to address an agreement of purchase and sale accurately during offer negotiations, disclosing confidential information to other interested parties when there are multiple buyers offering on the property

Question 108

Lack of due diligence

Answer 108

• Failing to present all aspects of a property to a buyer in a diligent manner. • Failing to market a property in a diligent manner for a seller client. • Failing to diligently pursue all suitable properties on behalf of a buyer client.

Question 109

Breach of duties, obligations, and disclosure requirementshttps://www.brainscape.com/decks/11016942/cards/quick_new_card

Answer 109

• Misrepresenting or failing to disclose material information to the client. • Breaching duties as specified in the agreement. Examples include failing to provide all the services promised and documented in the agreement, such as reducing the marketing exposure of the property or cancelling any open houses promised to the seller. • Failing to carry out obligations in a conscientious and competent manner. • Failing to discuss representation, customer service, and the possibility of multiple representations with sellers and buyers at the earliest opportunity.