Question Bank 2 Flashcards

Question

Question 525: Julie is acting as the listing licensee for a property owned by her client, George. Julie also represents a client, Ahmed, whom she is helping find a suitable property to buy. Ahmed becomes interested in purchasing George’s property. Julie would like to continue to represent George as a client in the sale of his property, while releasing Ahmed as a client. To do this, Julie must enter into an Agreement Regarding Conflict of Interest Between Clients with: (1)George, the continuing client, only (2)Ahmed, the released client, only (3)Both George and Ahmed (4)Neither George nor Ahmed, as the Agreement Regarding Conflict of Interest Between Clients must only be agreed to by Julie’s managing broker

Answer 1

Answer: 3 Explanation: Option (3) is correct because when a licensee is faced with a conflict of interest between multiple clients, the licensee must enter into an Agreement Regarding Conflict of Interest Between Clients with all clients. Options (1), (2), and (4) are incorrect for this reason.

Answer 2

Answer: 2 Explanation: Option (2) is correct because the School Act is one of seven statutes which form the foundation of the real property tax system in British Columbia. The School Act provides for real property taxation to fund public

Answer 3

Answer: 4 Explanation: Option (4) is correct because private nuisance typically occurs where an owner or occupier of land unreasonably and substantially interferes with the reasonable use and enjoyment of a neighbouring property. Option (1) is incorrect because section 26(3) of the Residential Tenancy Act abolishes the remedy of distress in residential tenancies. Option (2) is incorrect because “distraint” or “distress” means a seizure and sale of the tenant’s personal property to recover arrears of rent. Option (3) is incorrect because a commercial landlord can exercise the remedy of distress, which is often the most effective remedy available to the landlord.

Answer 4

Answer: 4 Explanation: Option (4) is correct because, in British Columbia, the plaintiff calls each of its witnesses first. Once the defendant’s lawyer has had the opportunity to cross-examine each witness called by the plaintiff, the defendant then calls each of its own witnesses. Options (1), (2), and (3) are incorrect because each statement accurately describes the trial process in British Columbia.

Answer 5

Answer: 4 Explanation: Option (4) is correct as a strata council is the only party listed that is not likely to require an appraisal. Options (1), (2), and (3) are incorrect because each of these parties are likely to require an appraisal.

Answer 6

Answer: 4 Explanation: The correct answer is Option (4) since the income approach is more likely a primary method of appraisal for a commercial property valuation with income and expense data, rather than a single-family residence. Options (1) and (2) are incorrect because they describe warranted valuation practices. Option (3) is considered warranted, because although the two houses have similar floor plans and are in the same neighborhood, a sale without sufficient advertising may signal a non-arm’s length sale and would not be considered reliable.

Answer 7

Answer: 2 Explanation: Land does not depreciate; therefore Option (2) is correct. Options (1), (3), and (4) are depreciable assets.

Answer 8

Answer: 2 Explanation: Option (2) is correct because the value in exchange is the sale price of the home. Options (1), (3), and (4) are therefore incorrect.

Answer 9

Answer: 3 Explanation: Option (3) is correct because a leasehold interest is of a fixed duration, whereas a fee simple estate confers the right to possess and use land for an indefinite period of time. Option (1) is incorrect because, while the fee simple estate is the greatest estate in land in Canadian law, the Crown retains underlying title to all land. Therefore, fee simple estates remain subject to the Crown’s land use regulations. Option (2) is incorrect because, though rarely exercised, the Crown retains the prerogative power to expropriate land held in fee simple. Option (4) is incorrect because land held in fee simple will escheat (or, revert) back to the Crown if the owner of the estate dies without providing for the transfer of his or her property by way of will and has no known heirs.

Answer 10

Answer: 3 Explanation: Option (3) is correct (false) because if Yang files an objection and an appeals officer at the CRA confirms the assessment, Yang would have 90 days to appeal to the Tax Court of Canada. She could also potentially appeal the decision to the Federal Court of Appeal and then possibly to the Supreme Court of Canada. Options (1), (2), and (4) are incorrect because they are all true statements.

Answer 11

Answer: 2 Explanation: Option (2) is correct because unless the buyer instructs otherwise, an offer to purchase real estate must have standard terms relating to contract assignment. Option (1) is incorrect because the Knowledge Base, “Assignment Guidelines”, states that these words should not be used to describe the buyer. Option (3) is incorrect because assignments are permissible only as long as the Standard Assignment Terms are included in the contract of purchase and sale of real estate, and provided that the assignment does not prejudice the rights of the seller and the contract does not prohibit assignment. Option (4) is incorrect because a contract of purchase and sale can be assigned if certain requirements are met.

Answer 12

Answer: 1 Explanation: Option (1) is correct because it is an action taken during the placement stage, meant to avoid drawing the attention of financial institutions which would take note of unusually large cash deposits. Options (2) and (4) are incorrect because they are actions taken during the layering stage of the money-laundering process, meant to increase complexity and conceal the criminal origins of the proceeds. Option (3) is incorrect because it is an action taken during the integration stage. The sale of real estate will provide proceeds which appear to have been legally earned from investment.

Answer 13

Answer: 2 Explanation: The formula for this question is the costs of improvements plus the site value minus depreciation. Cost of Improvements $2,294,000 ($62  37,000) + Site Value + 1,200,000 $3,494,000  Depreciation  183,520 (0.08  $2,294,000) Market Value $3,310,480

Answer 14

Answer: 4 Explanation: Option (4) is correct because personal selling involves interactive, face-to-face communication with a potential customer. Option (1) is incorrect because telemarketing uses telephone or fax technology in place of face-to-face communication. Option (2) is incorrect because emotional appeal refers to a communications strategy that aims to stir up positive or negative emotions in an audience in order to generate a desired response. Option (3) is incorrect because brand marketing refers to a marketing initiative based on the theme of a business, which encompasses a variety of attributes that distinguish the business from its competitors.

Answer 15

Answer: 2 Explanation: Option (2) is correct because a private nuisance occurs when an owner or occupier of land unreasonably and substantially interferes with the reasonable use and enjoyment of a neighbouring property. Private nuisance typically occurs when an owner or occupier wrongfully allows the escape of injurious things (in this case, chlorinated water) onto another person’s land. Options (1) and (4) are incorrect because occupiers liability and the British Columbia Occupiers Liability Act concern the liability of an occupier for injury suffered by visitors entering their own premises, not for losses occurring on someone else’s property. Option (3) is incorrect because a patent defect is a defect in property that can be discovered during the course of a reasonable inspection. On the facts of this question, there is no indication that the leak was caused by any defect in the property of either Margaret or the neighbour.

Answer 16

Answer: 1 Explanation: Option (1) is correct because the income approach would not usually be used for the valuation of single-family residences. Options (2), (3) and (4) are incorrect because this approach can be used in appraising most types of property, although it is more appropriate for properties that produce rental income, e.g., apartment buildings, office buildings, industrial space.

Answer 17

Answer: 2 Explanation: Option (2) is correct because, after a contract has been made, but before it has been performed, it will be frustrated if events outside of the control of the parties destroy the subject matter of the contract. Options (1) and (3) are incorrect because, on the facts of this question, neither Allan nor Bob made a mistake relating to the contract. Option (4) is incorrect because the effect of frustration is the termination of the contract. In other words, the contract is ended at the point of frustration, and future rights and liabilities no longer apply. Termination is distinct from rescission in that rescission operates to “unmake” a contract, attempting to return the parties back to the position they were in prior to entering the contract.

Answer 18

Answer: 4 Explanation: Option (4) is correct because most mortgages contain a term which states that the mortgagee (the lender) shall not be bound for any reason whatsoever to advance any part of the money to the mortgagor (the borrower). If, for example, a builder’s lien is filed against the property, the lender may require the removal of the lien before advancing funds. Option (1) is incorrect because a lender may require a guarantor as a form of additional security for the loan. Option (2) is incorrect because the Strata Property Act provides that a lender can obtain the right to vote at meetings of the strata corporation on matters relating to insurance, maintenance, finance or other matters affecting the security of the mortgage. Option (3) is incorrect because lenders are generally given complete discretion to select from the available remedies. This ensures that lenders are given the greatest possible chance to recover their losses resulting from a borrower default.

Answer 19

Answer: 2 Explanation: Option (2) is correct because it is in the buyer’s (not the seller’s) best interests to incorporate a Property Disclosure Statement (PDS) into the contract of purchase and sale. Doing so incorporates the warranties made by the seller in the PDS into the contract of purchase and sale, which allows the buyer to sue the seller for breach of contract if such warranties are breached. Option (1) is incorrect because it allows the seller to review the buyer’s progress with regards to the fulfilment of the condition and decide whether or not to extend the time limit or to terminate the agreement. Option (3) is incorrect because if such a covenant is inserted into the contract of purchase and sale, and the buyer does not use his or her best efforts to satisfy the specific condition, the seller can sue the buyer for breach of contract. Option (4) is incorrect because a including a 72-hour “time clause” allows the seller to demand that the buyer remove the condition precedent within 72 hours in the event that the seller receives another offer. If the buyer fails to do so, then the seller can accept the other offer.

Answer 20

Answer: 4 Explanation: Option (4) is correct because when a comparable property is sold subject to a low interest rate, the comparable sale price must be adjusted downward. Option (1) is false because the comparable property can be used as evidence of market value, as long as an adjustment is made for the “cheap” financing provided by the vendor. Option (2) is false because the comparable sale price must be adjusted downward to compensate for the benefit provided by the below-market interest rate on the mortgage. Option (3) is false because the price of the comparable property needs to be adjusted to its cash-equivalent price.

Answer 21

Answer: 3 Explanation: Calculate the payments according to the contract, then value the payments according to the market rate. Add the cash down payment to the market value of the mortgage to find the sale price. Press Display 3.5  NOM% 3.5 2  P/YR 2  EFF% 3.530625 12  P/YR 12  NOM% 3.474749 115000 PV 115,000 240 N 240 0 FV 0 PMT 665.46245 665.46 +/ PMT 665.46 5  NOM% 5 2  P/YR 2  EFF% 5.0625 12  P/YR 12  NOM% 4.948699 PV 101,268.399094 (market value of the mortgage) + 105000 = 206,268.399094 (market value of the offer) The sale price of the house is $206,300 rounded to the nearest $100.

Answer 22

Answer: 2 Explanation: Press Display 4 I/YR 4 12  P/YR 12 250 +/ PMT 250 3 × 12 = N 36 0 PV 0 FV 9,545.390589 If Allison deposits $250 per month for 36 months, she will have $9,545.39 in the account at the end of three years.

Answer 23

Answer: 3 Explanation: To answer this question, calculate the maximum amount of money that can be lent out given the two constraints: the loan-to-value amount and the gross debt service ratio amount. Calculate the loan amount for the loan-to-value constraint and then calculate the loan amount for the GDSR constraint. In order to determine the maximum amount that the lender will advance, choose the lesser of the two results. LTV = 80%

Answer 24

Answer: 2 Explanation: Option (2) is correct because an option to purchase clause, if exercised, would deny the borrower his or her right to redeem title to the property upon repayment of the loan. In other words, if the bank exercised the option and chose to purchase the property, then the borrower would necessarily be unable to redeem title upon repayment. Option (1) is incorrect because collateral advantage clauses are no longer considered clogs on the borrower’s equity of redemption, even if they extend beyond the term of the mortgage. Option (3) is incorrect because indemnity clauses do not constitute clogs on the equity of redemption, and are instead rendered unenforceable by section 8(1) of the federal Interest Act. Option (4) is incorrect because an acceleration clause is a term in the mortgage contract which makes the outstanding balance of the loan immediately due and payable if the borrower defaults. Acceleration clauses do not interfere with the borrower’s right to redeem title upon repayment, since they operate in situations where the borrower has defaulted.

Answer 25

Answer: 3 Explanation: Option (3) is correct because the remedy of distress allows a commercial landlord to seize and sell a tenant’s personal property in order to satisfy a claim for rent owing. This is the most effective remedy because it immediately gives the landlord tangible assets which can be sold to recover the debt. Option (1) is incorrect because a tenant may choose to disobey an injunction, which would require that the landlord take additional legal action against them. Option (2) is incorrect because the third party to whom the garnishing order is served may still disobey the garnishing order. There are also additional limitations to this remedy, including a limit on the percentage that may be garnished from an employee’s wages. Option (4) is incorrect because a demand letter may be ignored by the tenant, in which case the landlord would be required to pursue additional action.

Answer 26

Answer: 1 Explanation: Option (1) is correct because, at common law, where an agent does not disclose to a third party that he or she is acting as an agent, the agent may be held liable as a principal. This rule is justified because the third party was led to believe that it was making a contract with the agent personally, and might not have chosen to enter a contract with the principal had they been aware of the principal’s existence and/or identity. Option (2) is incorrect because the contract is not between the agent and the principal, but is instead between the principal and the third party (though the agent may be held liable as a principal, as mentioned previously). Option (3) is incorrect because the contract remains between the principal and the third party, and therefore, the principal may sue the third party to enforce it. Option (4) is incorrect because an agent’s failure to disclose their status as an agent does not render a contract void.

Answer 27

Answer: 1 Explanation: Option (1) is correct because a constant payment mortgage has identical periodic payments. Options (2) and (3) describe a straight line principal reduction loan. Option (4) is incorrect because the constant payment is apportioned to varying levels of principal and interest.

Answer 28

Answer: 1 Explanation: Option (1) is correct because the Real Estate Services Rules prohibit a licensee from making inducement promises of this nature unless the licensee gives a signed statement containing the details of the promise to the person to whom the promise is made. A licensee who breaches this prohibition may be suspended by the British Columbia Financial Services Authority. Options (2), (3), and (4) are incorrect because none of these scenarios alleviate the licensee’s obligation to give a signed statement, setting forth the details of the promise, to the person to whom the promise is being made.

Answer 29

Answer: 2 Explanation: Option (2) is correct because the municipal council is not required to wait at least six months before approving an amendment to a zoning bylaw. Option (1) is incorrect because any rezoning bylaw must be given four readings by the municipal council, meaning that the council must vote in favour of the bylaw four separate times. Option (3) is incorrect because subdivision bylaws, made under the Local Government Act, may require that an owner dedicate up to five percent of his or her land for park purposes. In addition, sometimes an applicant will be required to pay for the widening of roads. Option (4) is incorrect because after a proposed rezoning bylaw receives a favourable first (or sometimes second) reading, a public hearing is usually held. At the hearing, the applicant may be required to give a short presentation, and will be asked questions about the proposal by the municipal council.

Answer 30

Answer: 3 Explanation: Option (3) is correct because in relation to the subject property, this comparable requires an adjustment of +$4,000 for 1 bedroom and +$5,700 for 1 bathroom. Options (1), (2), and (4) are therefore incorrect.

Answer 31

Answer: 3 Explanation: Option (3) is correct because, in addition to compensating victims of fraud, the Assurance Fund also provides compensation to individuals who have suffered loss or damages caused, solely or partially, by an omission, mistake or misfeasance of the registrar or employees of the Land Title Office. Options (1), (2), and (4) are incorrect because a claimant must prove the following to successfully claim against the Assurance Fund in British Columbia: (a) that the claimant has lost an interest in land as a result of the registration of a person other than the claimant as owner; (b) that the claimant cannot recover that estate or interest (or compensation for it) by a court action; and (c) that, if the Land Title Act had not been passed, the claimant would have recovered the estate or interest at common law by a court action.

Answer 32

Answer: 3 Explanation: Option (3) is correct because when using the comparative approach of appraisal to value properties with redevelopment potential, it is not necessary that the comparables and the subject property have a market value of zero in their current use. Options (1), (2), and (4) are incorrect because it is necessary that they have a similar highest and best use after redevelopment, have a similar current use, and expect to undergo redevelopment at a similar point in time.

Answer 33

Answer: 3 Explanation: Option (3) is correct because section 54 of the Law and Equity Act provides that where a condition precedent is for the sole benefit of the buyer, the buyer is allowed to unilaterally waive the condition prior to its expiration. Section 54 overrides the common law rule preventing the unilateral waiver of a true condition precedent. Option (1) is incorrect because the agreement remains valid and enforceable in this situation. Options (2) and (4) are incorrect because, in this situation, the agreement does not become voidable at either the option of the seller or the buyer.

Answer 34

Answer: 3 Explanation: Option (3) is correct because, with respect to commercial tenancies, the implied covenant of quiet enjoyment does not simply refer to freedom from noise; rather, it is an assurance to the tenant against the consequences of defective title. This means that if the landlord, or anyone who claims to have received rights from the landlord, attacks the tenant’s right to the premises, it would breach this covenant. Option (1) is incorrect because the implied covenant of quiet enjoyment does not concern competition with the tenant’s business. Option (2) is incorrect because the implied covenant of quiet enjoyment is an implied promise given by the landlord to the tenant, and does not restrict the tenant’s own conduct on the property. Option (4) is incorrect because the implied covenant of quiet enjoyment does not constitute a guarantee by the landlord that other tenants will comply with local noise bylaws.

Answer 35

Answer: 4 Explanation: Press Display 12  P/YR 12 23250 +/ PV 23,250 281.72 PMT 281.72 204 N 204 0 FV 0 I/YR 12.89841 (j12)  EFF% 13.688927 (j1) 2  P/YR 2  NOM% 13.25002 (j2)

Answer 36

Answer: 4 Explanation: Option (4) is correct because a restrictive covenant is an interest in land which can be registered at the Land Title Office. Once a valid restrictive covenant has been registered, it binds subsequent owners of the property (i.e., it “runs with the land”). Therefore, the covenantor (the person who agrees to be bound by the restriction) need not retain the restricted property for the restrictive covenant to remain valid. Option (1) is incorrect because, in order to be a valid restrictive covenant, an owner must be able to comply with the covenant by not doing something. If a covenant requires action it is a “positive” covenant, and does not run with the land. Options (2) and (3) are both incorrect because each statement is one of the five essential requirements of a valid restrictive covenant.

Answer 37

Answer: 3 Explanation: Option (3) is correct because an agent owes a duty of loyalty to the principal, which requires them to disclose to the principal all facts relevant to the transaction within the agent’s knowledge. The complete disclosure requirement prohibits an agent from making a “secret” profit, meaning that the agent must disclose all of the benefits and prospective benefits received by the agent as a result of, or in the course of, performing duties on behalf of the principal. Option (1) is incorrect because the agent is not required to disclose all of their personal business dealings to the principal if those dealings do not affect the interests of the principal. Option (2) is incorrect because the agent is not required to inform the principal of their own annual tax return, as this information does not affect the interests of the principal. Option (4) is incorrect because an agent has a duty to disclose all relevant facts that could influence the conduct of the principal. This duty is not limited to situations where the agent is receiving actual profits, and extends to situations where the agent will suffer a loss.

Answer 38

Answer: 4 Explanation: Option (4) is correct because gross potential revenue is estimated using current market rents paid on similar properties. Even when the subject or comparable property is fully rented, the rents used in determining the property’s net operating income should be compared to current rental prices. Therefore, Options (1), (2), and (3) are incorrect.

Answer 39

Answer: 2 Explanation: Option (2) is correct because the Strata Property Act gives strata corporations the ability to grant an owner or tenant permission to exclusively use common property for a period of less than one year. If the permission does not involve a significant change in the use or appearance of the common property, then the permission can be granted by a majority vote of the strata council. Option (1) is incorrect because approval by a ¾ vote, rather than a simple majority vote, at a general meeting of the strata corporation is only required where the permission or privilege granted involves a significant change in the use or appearance of the property. Option (3) is incorrect because permission to exclusively use common property may only be granted for less than one year, whereas the designation of limited common property has no fixed duration and need not be renewed. Therefore, the permission to exclusively use common property cannot be identical to the designation of limited common property. Option (4) is incorrect because the strata corporation may grant the permission for up to one year.

Answer 40

Answer: 3 Explanation: Option (3) is correct because a Board of Variance does not have the jurisdiction to amend zoning bylaws. Instead, the function of a Board of Variance is to permit minor exceptions, or “variances”, to existing bylaws, without altering the bylaws themselves. Amending zoning bylaws is the responsibility of municipal councils and regional districts. Options (1), (2), and (4) are incorrect because a Board of Variance is given the authority to hear appeals in situations where the enforcement of a bylaw would cause undue hardship. To achieve this purpose, the Board may permit a structural alteration to a building used for a non-conforming use, and may establish time limits within which construction of a variance must be completed.

Answer 41

Answer: 2 Explanation: Option (2) is correct because the REALTOR® Code of Ethics is enforced by the local real estate boards in British Columbia. Option (1) is incorrect because, while the Canadian Real Estate Association establishes the REALTOR® Code of Ethics, enforcement occurs at the local board level. Option (3) is incorrect because the British Columbia Real Estate Association is responsible for representing the interests of local real estate boards, and their members on provincial matters, and does not directly enforce the REALTOR® Code of Ethics. Option (4) is incorrect because the British Columbia Financial Services Authority (“BCFSA”) is a statutory body tasked with administering the Real Estate Services Act (RESA) and related regulations, and rules. The REALTOR® Code of Ethics is set by the Canadian Real Estate Association, which is a professional trade organization that is separate from BCFSA.

Answer 42

Answer: 1 Explanation: Option (1) is correct because a real estate trade record sheet is required for each transaction in which the brokerage or a related licensee holds or receives money. Since listing a property on the MLS® listing occurs prior to such a transaction, this information does not need to be included in the record sheet. Options (2), (3), and (4) are incorrect because each contains information that is necessary to accurately describe and record real estate transactions.

Answer 43

Answer: 2 Explanation: Option (2) is correct because section 15 of the Manufactured Home Act provides that no person may move a manufactured home unless it is registered in the manufactured homes registry. Additionally, section 18(1) requires that a transport permit be obtained from the registrar to authorize the movement of the home to a specific location. Option (1) is incorrect because the ownership, transfer and granting of charges of manufactured homes are not registered in the land title office. Option (3) is incorrect because a manufactured home with a security interest registered against it in the personal property registry can still be moved. The secured party remains protected because registrar is required to notify the secured party when an application for a transport permit is made. Option (4) is incorrect because, in certain cases, a landlord, a secured party, or any other person acting under a court order may obtain a transport permit authorizing them to move a manufactured home.

Answer 44

Answer: 3 Explanation: Option (3) in correct because joint tenants enjoy the right of survivorship, meaning that when one joint tenant dies, the entire estate automatically vests in the surviving joint tenant(s). Bert, therefore, became the sole owner of the revenue producing property immediately upon Ernie’s death and Ernie had no interest to dispose of in his will. Options (1) and (2) are incorrect because no interest in the property passed to Grover. Option (4) is incorrect because a joint tenant cannot sever a joint tenancy merely by bequeathing their interest in the property to a third party in their will. To sever the joint tenancy Ernie would have had to (a) destroy one of the four “unities” required for a joint tenancy to exist (e.g., by selling or mortgaging his estate); (b) partition the property via a mutual agreement with Bert; or (c) obtain a court order for partition.

Answer 45

Answer: 1 Explanation: Option (1) is correct because section 20(1) of the Land Title Act provides that “except as against the person making it”, an unregistered transfer deed is inoperative. This section indicates that an unregistered deed remains operative between the transferor and the transferee. Option (2) is incorrect because it is a long standing common law rule that a forged deed is void from the beginning. Option (3) is incorrect because, where the consideration given exchange for a deed amounts to an illegal act or thing, the transfer deed is void. Option (4) is incorrect because where a party can successfully plead non est factum (“that is not my deed”) the deed in question will be rendered void for reason of unilateral mistake.

Answer 46

Answer: 3 Explanation: Option (3) is correct because, since a sole proprietorship is a business enterprise owned by a single individual, the owner of a proprietorship is personally liable for all the debts incurred by the proprietorship. This means that, if the proprietorship is unable to pay its debts, the proprietorship’s creditors may collect from the personal assets of the owner. Option (1) is incorrect because, since a proprietorship is not regarded as a separate legal entity from the owner, it is terminated upon the death of the owner. Option (2) is incorrect because the profits of a proprietorship accrue to the owner and are taxed as part of his or her personal income. Option (4) is incorrect because, as stated previously, a proprietorship is not regarded as a separate legal entity from the owner, and the owner has unlimited liability.

Answer 47

Answer: 2 Explanation: Option (2) is correct because Ralph will likely be able to establish the three elements required for a successful negligence claim: (1) that XYZ, a company storing highly toxic gasses, owed him a duty of care as his neighbour; (2) that XYZ breached the standard of care by allowing the gas to drift over Ralph’s apple orchard; and (3) that the damage to Ralph’s orchard was reasonably foreseeable (i.e. not too remote). Option (1) is incorrect because trespass is an intentional tort, and consequently must be a direct, voluntary act, as opposed to an indirect result of an act. In this case, there is no indication that Hurston or the President intended to release the gas over Ralph’s apple orchard. Option (3) is incorrect because a fiduciary duty is only owed by a person who holds a legally significant position of trust with respect to someone else, and is obliged, by virtue of that relationship or trust, to act solely for the other person’s benefit. There is no indication, on the facts provided, that XYZ was in such a relationship of trust with Ralph. Option (4) is incorrect because the Occupiers Liability Act would only apply if Ralph had suffered damage while on XYZ’s premises.

Answer 48

Answer: 1 Explanation: Option (1) is correct because the Regulations passed under the Residential Tenancy Act provide that a security deposit for a residential tenancy agreement cannot exceed one half of the monthly rent. Options (2), (3), and (4) are incorrect because each of these amounts exceeds the amount permitted under the Act.

Answer 49

Answer: 1 Explanation: For this question, with a given monthly periodic rate, calculate how many years Joe will make payments. First, express the rate as a j12, then calculate N. Press Display .75 × 12 = I/YR 9 12  P/YR 12 11000 PV 11,000 335 +/ PMT 335 0 FV 0 N 37.837088 (months) ÷ 12 = 3.153091 (years) N is expressed as months; therefore, divide by 12 to express the amortization in years. Joe will have to make payments for three full years.

Answer 50

Answer: 2 Explanation: Option (2) is correct because when mortgage interest rates are casually referenced, it is typically a nominal interest rate. Therefore, Options (1), (3), and (4) are incorrect.

Answer 51

Answer: 2 Explanation: Option (2) is correct because Charlotte effectively revived her original offer (to sell her property to Dennis for $180,000), which Dennis then accepted. Dennis’ offer of $165,000 was a counter-offer, which therefore terminated the original offer. However, Charlotte made her own counter-offer when she replied, “cannot reduce price”, which effectively renewed her original offer. Option (1) is incorrect because the case of Livingstone v. Evans tells us that the words “cannot reduce price”, uttered in this context, renew the original offer. Dennis was therefore entitled to accept the renewed offer. Option (3) is incorrect because Charlotte’s initial email contained the necessary terms (the property and the price) to constitute an offer capable of being accepted, and therefore was more than a mere invitation to treat. Option (4) is incorrect because Options (1) and (3) are both incorrect.

Answer 52

Answer: 4 Explanation: Option (4) is correct because this extract is taken from section 59(3)(a) of the Law and Equity Act. Therefore, Options (1), (2), and (3) are incorrect.

Answer 53

Answer: 3 Explanation: Option (3) is correct because if a qualified home inspector would have identified the issue, it would likely be classified as a patent defect, which sellers do not have an obligation to disclose. As a buyer, Anna has a duty to conduct a reasonable inspection and make reasonable inquiries to ensure that there are no patent defects, which typically involves consulting a licensed home inspector. Option (1) is incorrect because, even for major issues, the seller is only required to disclose latent defects that he or she knows or should have reasonably known. Option (2) is incorrect because sellers are required to disclose known latent defects that render the property dangerous or unfit for habitation, even if the buyer did not specifically ask about that defect. Option (4) is incorrect because the defect’s impact on the property can be objectively determined at a value of $55,000 and therefore cannot be classified as a stigma.

Answer 54

Answer: 4 Explanation: Option (4) is correct because a common mistake occurs when both parties to a contract make the same mistake about a fundamental term of the contract, such as the existence of what is being sold. In this case, the fact that the cottage had been destroyed prior to the formation of the contract was unknown to both parties. The existence of a common mistake such as this renders a contract void. Option (1) is incorrect because a mutual mistake occurs when both parties make a fundamental mistake about the contract but each makes a different mistake. Here, the mistake was the same (the assumption that the cottage still existed). Option (2) is incorrect because frustration occurs where a specific thing that is necessary for the performance of the contract is no longer in existence at the time for performance. In this case, the cottage was destroyed before the contract was entered into, meaning that frustration does not apply. Option (3) is incorrect because (a) there is no indication that Jem did not understand the nature of the contract of sale; and (b) the mistake regarding the existence of the cottage was a common mistake, not a unilateral mistake since both Jem and Boo were mistaken.

Answer 55

Answer: 3 Explanation: Option (3) is correct because it is false. The duty of confidentiality to a client lasts forever. Option (1) is incorrect because actions that are unlawful would be against the duty of acting in the client’s best interest. Option (2) is incorrect because section 45 of the Real Estate Services Rules requires licensees to obtain written authorization to sign agreements on behalf of their clients. Option (4) is incorrect because full disclosure requires licensees disclose to their clients all known material information, no matter how trivial.

Answer 56

Answer: 1 Explanation: Option (1) is correct because one of the undesirable aspects of the common law pertaining to contracts is that when no mention of the state of title is made in the contract beneficial ownership, and therefore risk of loss or damage, passes to the buyer at the time the contract is signed. The standard form Contract of Purchase and Sale in BC expressly alters this common law presumption. Options (2), (3), and (4) are therefore incorrect.

Answer 57

Answer: 1 Explanation: Option (1) is correct because the key purpose of the Disclosure of Representation in Trading Services form is to ensure that consumers understand how trading services can be provided to them, so that they can provide informed consent to the chosen form of relationship with the real estate licensee. Options (2), (3), and (4) are incorrect for this reason.

Answer 58

Answer: 1 Explanation: Option (1) is correct because licensees have a duty to present all options to a client (which includes all offers) unless the client has given specific instructions to somehow limit which offers are to be presented. Options (2), (3), and (4) are incorrect because all three offers must be presented to your client.

Answer 59

Answer: 2 Explanation: Option (2) is correct because a borrower who grants a legal mortgage retains an equitable interest in the property. The borrower is free to mortgage this equitable interest by granting a second, or subsequent, mortgage. These subsequent mortgages are mortgages on the borrower’s equity of redemption (the borrower’s right to repay the mortgage and redeem title to the property). Option (1) is incorrect because, though also a form of security interest, a lien is not a mortgage. Options (3) and (4) are incorrect because agreements for sale and leases are not mortgages.

Answer 60

Answer: 1 Explanation: Option (1) is correct because, at the first court appearance where a claim for foreclosure is brought, a judge will generally grant an order nisi. The order nisi is an important preliminary step because it sets the final redemption period, during which the respondents can redeem the mortgage by paying the amount due and owing. Options (2) and (3) are incorrect because orders absolute and orders for sale may be obtained if payment is not made within the redemption period set by the order nisi. Option (4) is incorrect because an order for specific performance may be available in the case of an agreement for sale, but is not an available remedy for foreclosure actions.

Answer 61

Answer: 2 Explanation: Option (2) is correct because mortgages payable represents a debt that must be repaid. Option (1) is incorrect because accumulated depreciation is part of the assets section on the balance sheet, and takes away from the value of the depreciable asset(s). Options (3) and (4) are incorrect because wages paid is listed as an expense, and prepaid expenses are listed as a current asset.

Answer 62

Answer: 2 Explanation: Option (2) is correct because revaluing assets is inconsistent with the cost principle. Option (1) is consistent with the matching principle, Option (3) is consistent with the consistency principle, and Option (4) is consistent with the revenue recognition principle.

Answer 63

Answer: 2 Explanation: Option (2) is correct because a secondary mortgage market is the market in which existing mortgages are bought and sold between investors. Options (1), (3), and (4) are incorrect.

Answer 64

Answer: 3 Explanation: If the investor can earn j12 = 6% on other investments, the purchase price of the mortgage should be based on a market value of j12 = 6%. First, calculate the mortgage payment based on the contract rate of j12 = 3.5%. Since this question also has a 5-year term, calculate the outstanding balance at the end of the 5-year term and set this amount equal to the future value with N equal to 60. Press Display 3.5 I/YR 3.5 12  P/YR 12 100000 PV 100,000 240 N 240 0 FV 0 PMT 579.959718 579.96 +/ PMT 579.96 60 INPUT  AMORT PER 60-60 = = = 81,126.556103 81126.56 +/ FV 81,126.56 6 I/YR 6 60 N 60 PV 90,143.732174

Answer 65

Answer: 4 Explanation: Option (4) is correct because constant payment loans were developed in response to the risk to the lender of default on principal. The constant payment reduces this risk as each periodic payment reduces the amount of principal at risk. Options (1), (2), and (3) are incorrect.

Answer 66

Answer: 3 Explanation: Option (3) is correct because common area charges could be applicable to condominiums only, as condominiums consist of a tenancy in common interest in the common areas of the development, while some other types of real property do not. Options (1), (2), and (4) are incorrect because location and neighbourhood, quality of construction, and the interest rate on the mortgage are applicable to all types of property, not just condominiums.

Answer 67

Answer: 1 Explanation: For this question, calculate the payments based on the contract information. Therefore, do not deduct the legal costs/brokerage fees to calculate the monthly payment. Press Display 12  NOM% 12 2  P/YR 2  EFF% 12.36 12  P/YR 12  NOM% 11.710553 55000 PV 55,000 180 N 180 0 FV 0 PMT 649.885293

Answer 68

Answer: 1 Explanation: Press Display 12  P/YR 12 357000 PV 357,000 2262 +/ PMT 2,262 327975.95 +/ FV 327,975.95 24 N 24 I/YR 3.679894  EFF% 3.742599 The yield to the lender is below the loan’s interest rates (j12 = 4.75%), which is the expected result given the payments are sufficient to pay off a $350,000 loan, but the lender is actually advancing $357,000 (2%× $350,000 + $350,000). Therefore, the lender is being slightly underpaid with each payment. Given the inverse relationship between interest rates and present value; if the present value rises, then the interest rate drops.

Answer 69

Answer: 2 Explanation: The first step for this question is to calculate the monthly payments. The second step is to use the payments in the GDSR formula to calculate the minimum annual income. Press Display 11.75  NOM% 11.75 2  P/YR 2  EFF% 12.095156 12  P/YR 12  NOM% 11.472285 42500 PV 42,500 300 N 300 0 FV 0 PMT 431.138315 431.14 × 12 = 5,173.68 First multiply the payments by 12 in order to find the yearly payment amount (equal to $5,173.68). Then use the GDSR formula to calculate the minimum income:

Answer 70

Answer: 1 Explanation: For this question, calculate the mortgage payments, based on the original contract rate. Then, calculate the market value of the mortgage and add it to the down payment to calculate the market value of offer. Press Display 5  NOM% 5 2  P/YR 2  EFF% 5.0625 12  P/YR 12  NOM% 4.948699 250000 – 80000 = PV 170,000 240 N 240 0 FV 0 PMT 1,117.112554 1117.11 +/ PMT 1,117.11 8  NOM% 8 2  P/YR 2  EFF% 8.16 12  P/YR 12  NOM% 7.869836 PV 134,858.442629 (market value of the mortgage) + 80000 = 214,858.442629 (market value of the offer) The market value of the offer is $214,860, rounded to the nearest $10.

Answer 71

Answer: 4 Explanation: The first step in answering this question is to calculate the payments based on the terms of the contract. The second step is to calculate the disclosure rate, which requires you to use the present value equal to the face value minus fees ($96,750). Press Display 5  NOM% 5 2  P/YR 2  EFF% 5.0625 12  P/YR 12  NOM% 4.948699 100000 PV 100,000 240 N 240 0 FV 0 PMT 657.125032 657.13 +/ PMT 657.13 60 INPUT  AMORT PER 60-60 = = = 83,378.06418 83378.06 +/ FV 83,378.06 96750 PV 96,750 ($100,000  $2,500  $750) 60 N 60 I/YR 5.758519 (j12)  EFF% 5.912962 (j1)

Answer 72

Answer: 3 Explanation: Option (3) is correct because reducing the loan-to-value ratio is the only option listed that the mortgagee can ensure there is sufficient security against the loan. Options (1), (2), and (4) are incorrect because a longer amortization period, smaller monthly payment, or lower debt coverage ratio will not guarantee sufficient security against the loan or that the borrowers are in a financial position that will enable them to make the necessary payments.

Answer 73

Answer: 4 Explanation: To calculate the maximum loan amount, calculate the loan amounts based on both the constraint of the loan-to-value ratio and the gross debt service ratio. The loan-to-value is calculated based on the bank’s appraisal of the property. In this case, the amount the bank appraises the property at is $275,000. Once the payments from the GDSR are calculated, the PV of the loan is calculated, taking into consideration the stress test qualification rules. The loan amount that satisfies both constraints (the smaller amount) will be the maximum loan amount. LTV = 80%

Answer 74

Answer: 1 Explanation: For this question, calculate the monthly interest rate (imo). Press Display 12  P/YR 12 200000 +/– PV –200,000 0 PMT 0 36 N 36 280985.6 FV 280,985.6 I/YR 11.386552 ÷12 = 0.948879

Answer 75

Answer: 3 Explanation: Option (3) is correct because British Columbia’s regular tax deferral program will allow Mrs. Joseph to make an application to defer up to 100% of the net property taxes payable on the property, since it will be here principal place of residence. Assuming that Mrs. Joseph is either a Canadian citizen or a permanent resident, and that she would have a minimum equity of 25% in the property if she purchased it, she would likely qualify for the regular program given that she is both 55 and a widow. Option (1) is incorrect because a reverse annuity mortgage is a type of mortgage that can function to supplement the income of aged persons who already own their home, not as a way to reduce mortgage payments where a new home is being purchased. Option (2) is incorrect because the property is the only residential property in an area of commercial development. While section 19(8) of the Assessment Act permits certain residential properties to be assessed according to the value based solely on their current residential use, Mrs. Joseph would not qualify for this special assessment because she has not lived continuously in the residence for ten years. Option (4) is incorrect because Mrs. Joseph would only qualify for the basic home owner grant, which cannot be used to reduce total property taxes below $350.00.

Answer 76

Answer: 1 Explanation: Option (1) is the correct answer as a hard change is the establishment of a new metric standard size, such as 150mm. Options (2), (3), and (4) are incorrect.

Answer 77

Answer: 1 Explanation: Option (1) is correct because convection heat transfer occurs when the baseboard heating unit warms the air in the room. As the air around the baseboard unit warms, the warmer air rises and cooler air falls, creating a convective current in the room. Options (2), (3), and (4) are incorrect as they do not describe the principal way that such a heating system provides most of its heat transfer.

Answer 78

Answer: 3 Explanation: The accelerated bi-weekly payment is ½ of the regular monthly payment. Press Display 5.5  NOM% 5.5 2  P/YR 2  EFF% 5.575625 12  P/YR 12  NOM% 5.438018 350000 PV 350,000 240 N 240 0 FV 0 PMT 2,395.36951 ÷ 2 = –1,197.684755 The accelerated bi-weekly payment is $1,198, rounded up to the next higher dollar.

Answer 79

Answer: 3 Explanation: To find the adjusted sale price of the comparable, take the sum of the listed sale price with its adjustments to the subject property. In this case, the subject property and the comparable are identical except that the subject property has 1 additional bedroom and 100 square feet less. The adjusted sale price is: $225,800 + $3,200 –$6,000 = $223,000.

Answer 80

Answer: 3 Explanation: Option (3) is correct because in the comparative approach of appraisal, it is most important that the subject building and the comparable buildings be similar with respect to factors judged important by buyers and sellers. Options (1), (2), and (4) are incorrect because similarity is only required for those factors that have a major influence on buyers and sellers, and the sale prices they negotiate.

Answer 81

Answer: 3 Explanation: Option (3) is correct because if the cost of developing houses is greater than their market value, development will stop in the short run until market values rise. Options (1), (2), and (4) are incorrect because they do not describe the short run effects of an increase in the cost of developing houses.

Answer 82

Answer: 1 Explanation: Comparable A

Answer 83

Answer: 2 Explanation: Option (2) is correct (false) because the vacancy allowance should be determined by the long-term vacancy rates in the area; that is, the vacancies in comparable buildings modified, if necessary, by expected future trends. Options (1), (3), and (4) are incorrect because they are true.

Answer 84

Answer: 3 Explanation: Option (3) is correct because functional incurable depreciation refers to outdated features that cannot be easily corrected, such as narrow hallways. Options (1), (2), and (4) are incorrect because these are relatively easily corrected.

Answer 85

Answer: 2 Explanation: Option (2) is the correct answer: explaining the marketing program during a listing presentation will help a client understand what benefits the licensee is providing. Options (1), (3), and (4) are all ways that a licensee can effectively communicate the value of their services to a potential client in a listing presentation.

Answer 86

Answer: 4 Explanation: Option (4) is correct because the Multiple Listing Service® serves many functions, including computing listing searches, producing automated hot sheets, and generating Comparative Market Analysis (CMA) presentations and other client prospecting tools. Options (1), (2), and (3) are therefore incorrect.

Answer 87

Answer: 2 Explanation: Option (2) is correct because a licensee is required to meet the educational and experience requirement appropriate to the level of licence for which the application is made. In addition to meeting the educational requirements for a representative licence, to qualify for a managing broker’s licence, a person must have been providing real estate services British Columbia or an equivalent jurisdiction for at least two years during the five years before the date of the application. Option (1) is incorrect because, while brokerages are required to keep certain specified financial records (section 25 of RESA), persons applying for managing broker’s licences do not need to submit personal financial statements for each licensee they intend to hire. Option (3) is incorrect because, as mentioned previously, an applicant’s licensed experience can come from British Columbia or an equivalent jurisdiction. Option (4) is incorrect because Options (1) and (3) are incorrect.

Answer 88

Answer: 2 Explanation: Option (2) is correct because the Real Estate Services Act requires that a person who provides “real estate services” on behalf of another for or in expectation of remuneration must be licensed. There is no licensing requirement for persons like Alan, who perform real estate services without receiving or expecting any money or reward. Option (1) is incorrect for the same reason. Option (3) is incorrect because “real estate services” are not limited to the writing of the contract of purchase and sale. The Real Estate Services Act defines “real estate services” as including actions such as advising on the appropriate price for real estate, making representations about a property, finding a party to acquire real estate, showing the real estate, and negotiating the price of real estate. Therefore, Alan may not perform any of these services (or any other service included in the definition of “trading services”) and receive money for it. Option (4) is incorrect because siblings are not exempt from the licensing requirement established by section 3 of the Real Estate Services Act. Therefore, if Alan is unlicensed, Peter cannot pay him for providing real estate services.

Answer 89

Answer: 3 Explanation: Option (3) is correct because there is no right of survivorship in a tenancy in common. Therefore, where two people own property as tenants in common, they each may leave their interest by will to whomever they wish. Option (1) is incorrect because the essential feature of joint tenancy is the right of survivorship. This means that when one joint tenant dies, the property automatically vests in the surviving joint tenant(s). Option (2) is incorrect because all joint tenants must receive their interests at the same time and from the same document. Therefore, if one joint tenant transfers his interest to a third party, both the unity of time and the unity of title are destroyed, and the co-ownership is converted to a tenancy in common. Option (4) is incorrect for the same reason.

Answer 90

Answer: 3 Explanation: Option (3) is correct because British Columbia does not have a pure Torrens system of title registration, and therefore allows a notation of trust to be made on the title. In a pure Torrens system, no mention of a trust can appear on the register. Option (1) is incorrect because a caveat is a short-term notice registered against a title to land warning those looking at the title that a claim for an estate or interest in the property has been made. Option (2) is incorrect because a lis pendens is a term previously used for what is now called a certificate of pending litigation. Option (4) is incorrect because issuing a duplicate certificate of title does nothing to show that the property is registered in favour of a trustee.

Answer 91

Answer: 3 Explanation: Option (3) is correct because the four requirements for an action for negligent misrepresentation are met: (1) Mark made an untrue statement when he told John that there was no termite problem; (2) the statement was likely negligent because, assuming that Mark was not outright lying, he failed to ascertain the necessary information regarding the termites before telling John that there was no infestation; (3) as an experienced professional giving advice to a person (John) who would reasonably rely on that advice, Mark owed John a duty of care; and (4) given the position of Mark, a real estate licensee showing a home, it was likely reasonable for John to rely on Mark’s statement. Since these four elements are likely met, Mark is likely liable to John for the repairs on the grounds of negligent misrepresentation. Option (1) is incorrect because John did not suffer loss while Mark was showing him the home. Option (2) is incorrect because private nuisance occurs where an owner or occupier of land unreasonably or substantially interferes with the reasonable use and enjoyment of a neighbouring property. Option (4) is incorrect because vicarious liability is the principle that renders employers liable for wrongful acts committed by their employees. In this case, vicarious liability may render Mark’s real estate brokerage liable for his negligent misrepresentation.

Answer 92

Answer: 3 Explanation: Option (3) is correct because there are no legal restrictions regarding security deposits in commercial tenancies. This amount is left open to negotiation. Option (1) is incorrect because the allocation of interest on security deposits in commercial tenancies is open for negotiation, and therefore may be allocated to the tenant. Additionally, the Residential Tenancy Act and the Residential Tenancy Regulation require that the landlord pay interest on a security deposit to the tenant upon termination of the tenancy. Option (2) is incorrect because, in commercial tenancies, the return of a security deposit is a personal obligation of the landlord. A purchaser is under no duty to the tenant to repay it. In residential tenancies a security deposit, and the obligation of the landlord to repay it (with interest), runs with the land. Therefore, assuming the tenancy continues after the property is transferred, the purchaser will be required to pay these amounts out to the tenant when the tenancy ends. Option (4) is incorrect because Options (1) and (2) are incorrect.

Answer 93

Answer: 4 Explanation: Option (4) is correct because the owners in a bare land strata development will be responsible for any costs associated with common property. Recreational facilities are frequently built as common property on a bare land strata development. Option (1) is incorrect because uniform appearance is typically ensured through registered building schemes and strata bylaws, rather than easement agreements. Option (2) is incorrect because title to the land on which roads are placed can be retained by the strata corporation as common property, such that the owners of the strata lots would be responsible for maintenance and repair. Option (3) is incorrect because bare land strata developments, aside from being for residential and recreational development, are often also used for industrial and commercial development.

Answer 94

Answer: 2 Explanation: Option (2) is correct because, if a property is to be listed and then sold, all persons who have an ownership interest in the property must agree to the listing. Therefore, it is essential that the listing contract is signed by all of the owners. Option (1) is incorrect because the purchaser is not party to the listing contract, and therefore cannot rely on any of the terms within it. Option (3) is incorrect because a licensee who does not review the title of the listed property assumes the risk of liability to the purchaser, loss of commission, and disciplinary proceedings if a complaint is registered with the British Columbia Financial Services Authority. This remains true even if the licensee includes terms such as “approximately” or “more or less” when describing a property. Option (4) is incorrect because Options (1) and (3) are incorrect.

Answer 95

Answer: 2 Explanation: Option (2) is correct because at common law there are three situations where an agent will be personally liable to a third party. One of these situations is where the agent fails to disclose that he/she is an agent. Option (1) is incorrect because an agent will generally not be personally liable to third parties provided that the agent: (a) discloses their status as an agent; (b) has authority to act as an agent; and (c) does not commit any torts. Option (3) is incorrect because an agent may be granted authority from the principal orally, or by implication in certain cases. In either of these situations, the agent will possess legitimate authority and will not be personally liable to third parties merely for the reason do not have written authority. Option (4) is incorrect because Options (1) and (3) are incorrect.

Answer 96

Answer: 3 Explanation: Option (3) is correct because, since Victoria (the seller) has already paid the full year’s property taxes, Penny (the buyer) should reimburse Victoria for the portion of the taxes from and including the adjustment date up to the end of the year. In this case, Penny’s share of the year’s property taxes (Dec. 28 – Dec. 31 = 4 days) is calculated in the following manner: 4/365 × $2,300 = $25.21. This amount will appear as a debit on Penny’s statement of adjustments. The late payment penalty incurred by Victoria will not be reflected on Penny’s statement of adjustments because it was Victoria’s responsibility to pay the property taxes on time. Therefore, Options (1), (2), and (4) are incorrect.

Answer 97

Answer: 1 Explanation: Seller’s Statement of Adjustments (Vivian) ITEM DEBIT CREDIT Purchase Price 140,000.00 Commission 8,400.00 Take Back Mortgage 8,000.00 Outstanding Mortgage 12,000.00 Buyer's Share of Taxes* 25.21 Penalty 85.00 Cash Proceeds of Sale** 111,540.21 _________ 140,025.21 140,025.21 * (Dec. 28-Dec. 31 = 4 days) 4/365  $2,300 = $25.21 ** Because the total Debits and Credits must balance, in order to find the Proceeds of Sale, you must first calculate the total Credits ($140,025.21) and then subtract the known Debits. The result is the balance of cash that the seller can expect to receive after all outstanding expenses relating to the property have been paid.

Answer 98

Answer: 2 Explanation: Option (2) is correct. When a deposit is paid to a real estate brokerage, the amount of the deposit will be reflected on the buyer’s statement of adjustments as a credit. It will not appear on the seller’s statement of adjustments, therefore Options (1), (3), and (4) are incorrect.

Answer 99

Answer: 3 Explanation: Option (3) is correct because, where a contract has not been executed, the available remedy for innocent misrepresentation is rescission (cancellation of the contract). Option (1) is incorrect because revocation refers to the cancellation of an offer. Once a contract has been made, revocation is no longer available. Option (2) is incorrect because rectification is a remedy typically available where there has been a mistake leading to the formation of a contract, not for misrepresentation. Option (4) is incorrect because Option (3) is correct.

Answer 100

Answer: 3 Explanation: Option (3) is correct because, in the context of Lois’ inquiry regarding the possibility of a lower rate, Abdul statement that his rate was $30 per hour was an offer. This was a valid offer because it contained the necessary terms for a contract to be entered into; in this case, price ($30 per hour) and subject matter (squash lessons). Option (1) is incorrect because the advertisement was most likely an invitation to treat, used by Abdul to induce radio listeners to pursue a contract for tennis lessons with him. Option (2) is incorrect for the same reason, and for the reason that Lois’ call was merely an inquiry regarding the possibility of a lower rate for students. Lois did not propose a new rate, therefore, he did not make a counter-offer. Option (4) is incorrect for the same reason.

Answer 101

Answer: 4 Explanation: Option (4) is correct because there must be at least one general partner in a limited partnership. The general partner(s) have unlimited liability, and can engage in the management or operations of the partnership. Options (1), (2), and (3) are all incorrect statements.

Answer 102

Answer: 3 Explanation: Option (3) is correct because joists are the horizontal framing members that support the floors. Option (1) is incorrect because joists do not support rafters. Options (2) and (4) are incorrect as the foundation is the poured concrete footprint that supports the superstructure above.

Answer 103

Answer: 1 Explanation: Option (1) is correct because an essential feature of joint tenancy is the right of survivorship. This means that when one joint tenant dies, the entire estate automatically vests in the surviving joint tenants. Option (2) is incorrect because, in British Columbia, the default form of co-ownership is tenancy in common, not joint tenancy. This means that if a document transfers a property without expressly stating the type of co-ownership, the new owners will be presumed to hold the property as tenants in common. Option (3) is incorrect because Paul severed the joint tenancy when he transferred his interest to his son and registered it at the land title office. This act converted the co-ownership of the property into a tenancy in common. Option (4) is incorrect because joint tenants enjoy a unity of possession, meaning that each co-owner is entitled to possession of the whole of the estate and no joint tenant can hold possession of any part separately and to the exclusion of others.

Answer 104

Answer: 4 Explanation: Find the property’s loan-to-value ratio using the value of the mortgage and the property’s lending value.

Answer 105

Answer: 4 Explanation: The market value of Alice’s offer is the market value of the mortgage plus her cash down payment. Alice will assume the remaining 24 monthly payments of $822.06 and the outstanding balance of $108,904.49. Calculate the market value of the mortgage by determining the PV of the payments and OSB remaining at the end of the original 5-year term based on the current market rate of j2 = 8.75%. Press Display 8.75  NOM% 8.75 2  P/YR 2  EFF% 8.941406 12  P/YR 12  NOM% 8.594631 24 N 24 822.06 +/ PMT 822.06 108904.49 +/ FV 108,904.49 PV 109,829.017089 (market value of the mortgage) + 25000 = 134,829.017089 (market value of the offer)

Answer 106

Answer: 3 Explanation: Press Display 6 I/YR 6 4  P/YR 4 450 PMT 450 4 × 4 = N 16 0 FV 0 PV 6,359.06882 Kevin should pay $6,359.07 for this investment if he wants to earn j4 = 6%.

Answer 107

Answer: 2 Explanation: Press Display 1  P/YR 1 262000 +/ PV 262,000 0 PMT 0 7 N 7 332000 FV 332,000 I/YR 3.440586 Sue’s pre-tax yield on her investment is an effective annual rate of 3.440586%.

Answer 108

Answer: 4 Explanation: Option (4) is correct because the accelerated biweekly payment is calculated as the monthly payment divided in half; instead of paying once a month, one-half of the monthly payment is paid every two weeks. Since the effect of the accelerated biweekly payments allows the borrower to make the equivalent of one extra monthly payment, the borrower will pay less interest over the loan and make a larger number of payments in a calendar year than with a constant monthly repayment schedule. Option (1) is incorrect because the borrower will make more monthly payments in a calendar year than a borrower who makes constant monthly payments. Option (2) is incorrect because the borrower will pay less interest over the life of the loan than a borrower who makes constant monthly payments. Option (3) is incorrect because the borrower pays one-half of the monthly payment every two weeks. This amounts to one-twenty-fourth of the annual payment, since one-twelfth of the annual payment is equivalent to the monthly payment.

Answer 109

Answer: 2 Explanation: Option (2) is correct because when estimating gross potential rents, the appraiser should have a sound knowledge of the current market rents for various types of accommodation, as gross potential rent is estimated using the market rents for recently leased similar space. Options (1), (3), and (4) are therefore incorrect.

Answer 110

Answer: 4 Explanation: To find the market value of the subject property, determine the NOI for the subject property using the comparable information given.

Answer 111

Answer: 3 Explanation: Option (3) is correct because public relations refers to communications (other than personal selling and advertising) for the purpose of enhancing the image, recognition, and reputation of the firm. These communications can be with employees, stockholders, clients, and the general public. Option (1) is incorrect because sales promotion refers to any form of non-personal selling that does not fall under the head of public relations, advertising, or publicity. Option (2) is incorrect because undifferentiated marketing is a practice of marketing a product or service, not enhancing the general image and reputation of a business. Option (4) is incorrect because target theory is concerned with which group(s) a business focuses their marketing efforts on, and does not directly involve enhancing the general image and reputation of the business.

Answer 112

Answer: 4 Explanation: Option (4) is correct the Superintendent of Real Estate is appointed by the BC Financial Services Authority board of directors. Options (1), (2), and (3) are incorrect for that reason.

Answer 113

Answer: 4 Explanation: Option (4) is correct because, although the definition of a residential complex includes most dwelling-units, a home which is used for short-term rentals would likely be considered a dwelling unit akin to a hotel, and thus would be excluded from the definition of a residential complex under the Excise Tax Act. Option (1) is incorrect because the residential complex definition includes land that is reasonably necessary for the use and enjoyment of the complex as a place of residence. Options (2) and (3) are incorrect because the definition of residential complex includes detached homes and condominiums used as dwelling houses which do not fall under the “hotel” exception.

Answer 114

Answer: 2 Explanation: Option (2) is correct because, in order to subdivide his lot and build two condominium projects, Bard will need the municipal council or regional district to pass a new bylaw amending the current zoning bylaw. To pass a bylaw changing the permitted use or density of the zone, a public hearing must be held to give persons whose interest in property would be affected an opportunity to be heard. Option (1) is incorrect because a legal non-conforming use refers to land use that is impermissible under current zoning restrictions, but which is nevertheless lawful because the use existed lawfully before the restrictions took effect. One cannot apply for a legal non-conforming use exemption for the purposes of converting a property to a use currently prohibited by an existing bylaw. Option (3) is incorrect because, in order to further change the use or density of a zone, the municipal council must hold another public hearing. Option (4) is incorrect because Options (1) and (3) are incorrect.

Answer 115

Answer: 4 Explanation: Option (4) is correct because a garnishing order may only be obtained either during or after a lawsuit (depending on the circumstances), but never before the lawsuit has been brought before a judge. Option (1) is incorrect because a notice of civil claim outlines the details of a plaintiff’s claim, and is served to the defendant before the claim is actually brought before a judge. Option (2) is incorrect because a response to civil claim is the defendant’s initial written reply to the notice of civil claim, and it is also filed and served before the claim is brought before a judge. Option (3) is incorrect because discovery proceedings are a means for bringing out the relevant evidence before the case gets to trial.

Answer 116

Answer: 1 Explanation: Option (1) is correct because with an interest accruing loan, the lender receives no payments before the maturity of the loan. This means that the entire loan amount and the interest accrued is at risk throughout the entire term of the loan, making it the most risky of the four types of loans in this question, all other things being equal. Option (2) is incorrect because an interest only loan is less risky because the borrower contracts to make regular payments of the interest earned to the lender throughout the term of the loan. Options (3) and (4) are incorrect because, with both of these loans, the lender receives periodic payments of both the principal amount and interest throughout the term of the loan.

Answer 117

Answer: 1 Explanation: Option (1) is correct because property taxes are paid on July 1, therefore, they have been paid by the seller. When property taxes have been paid by the seller, the buyer should reimburse the seller for that portion of the year from and including the adjustment date. The tax adjustment will appear as a credit on the seller’s statement and a debit on the buyer’s statement. Options (2), (3), and (4) are therefore incorrect.

Answer 118

Answer: 3 Explanation: Option (3) is correct because the British Columbia Real Estate Services Act does not require licensees to disclose any other properties that they are considering. Options (1), (2), and (4) are incorrect because section 53 of the Real Estate Services Rules requires licensees who are selling or purchasing real estate on their own behalf to make a written disclosure of their personal interest in the transaction to the other party.

Answer 119

Answer: 4 Explanation: Option (4) is correct because there is no financial statement called a corporate statement of holdings. Options (1), (2), and (3) are incorrect because they are commonly used financial statements.

Answer 120

Answer: 3 Explanation: Option (3) is correct because amperage is defined as a measure of electrical flow. Option (1) is incorrect because voltage is defined as a measure of electrical potential. Options (2) and (4) are incorrect because wattage is defined as a measure of electrical consumption or power.

Answer 121

Answer: 4 Explanation: In this question, convert the effective annual interest rate to a monthly rate (j12) and then calculate the monthly payment. Press Display 6  NOM% 6 1  P/YR 1  EFF% 6 12  P/YR 12  NOM% 5.841061 196000 PV 196,000 180 N 180 0 FV 0 PMT 1,637.176436

Answer 122

Answer: 1 Explanation: Option (1) is correct because when real estate prices are increasing very quickly, they are reflecting the increasing market values of properties. The selling price would therefore likely be lower than the actual market value in a time of rapidly increasing real estate prices. Options (2) is incorrect because if a seller is not in a hurry to sell, he or she is likely to wait to obtain the highest possible price. Option (3) is incorrect because a buyer who is in a hurry to buy may pay a premium to acquire a property. Option (4) is incorrect because a property that has been exposed to the market for more than two months does not necessarily indicate that the sale price will be lower than the market value, as the market could fluctuate in many ways throughout the two months.

Answer 123

Answer: 2 Explanation: To find the nominal interest rate with semi-annual compounding, calculate the payment based on the face value of the loan of $217,200. Then, calculate the investor’s yield based on the loan payment and the amount that the investor pays ($225,000). Press Display 6.5  NOM% 6.5 2  P/YR 2  EFF% 6.605625 12  P/YR 12  NOM% 6.413688 217200 PV 217,200 240 N 240 0 FV 0 PMT 1,608.366906 1608.37 +/ PMT 1,608.37 Use the amount the investor pays as the new PV to calculate the yield. The calculator steps continue as follows: Press Display 225000 PV 225,000 I/YR 5.972251 (j12)  EFF% 6.138471 (j1) 2  P/YR 2  NOM% 6.047054 (j2)

Answer 124

Answer: 3 Explanation: To determine the amortization period for the loan, convert the annual interest rate, compounded semi-annually to an annual rate, compounded monthly. Then, calculate the amortization period. Press Display 6.5  NOM% 6.5 2  P/YR 2  EFF% 6.605625 12  P/YR 12  NOM% 6.413688 125000 PV 125,000 926 +/ PMT 926 0 FV 0 N 239.803291 The amortization period is 239.803291 months.

Answer 125

Answer: 2 Explanation: Option (2) is correct because a property that is not at its highest and best use has redevelopment potential, which is recognized as latent value. Options (1), (3), and (4) are incorrect.

Answer 126

Answer: 1 Explanation: Max loan = Lending value × Loan-to-value ratio Max loan = $363,000 × 0.80 Max loan = $290,400 This is the amount of their mortgage. The question asks for the down payment. If the purchase price is $365,000, and the mortgage is $290,400, then the down payment is equal to the difference of $74,600 ($365,000  $290,400).

Answer 127

Answer: 4 Explanation: Option (4) is correct because voltage is a measure of electrical potential, not power or consumption. Options (1), (2), and (3) are true statements.

Answer 128

Answer: 2 Explanation: Option (2) is correct because lenders are more interested in the income generated from the commercial property than the borrower’s personal income. Options (1), (3), and (4) are incorrect because they do not describe differences between underwriting income-producing properties and residential borrower qualification.

Answer 129

Answer: 4 Explanation: Option (4) is correct because a board of variance must be established by every local government that has adopted a zoning bylaw to ensure that the bylaw does not cause undue hardship. A board of variance may grant minor variances from zoning bylaws where compliance would cause undue hardship provided that the variance would not conflict with the policies of the local government. Option (1) is incorrect because boards of variance do not enforce municipality compliance with the Local Government Act. Option (2) is incorrect because boards of variance do not settle boundary line disputes between private parties. Option (3) is incorrect because legal non-conforming uses may be permitted to exist for more than six months.

Answer 130

Answer: 4 Explanation: Option (4) is correct because accounts payable is a liability, since it represents a debt owed. Option (1) is incorrect because accumulated depreciation will fall under the asset category of the balance sheet, and will take away from the value of the depreciable asset(s). Options (2) and (3) are incorrect because inventory and rent receivable are both current assets.

Answer 131

Answer: 4 Explanation: Option (4) is correct because the Residential Tenancy Regulation limits annual rent increases to an amount equal to the Consumer Price Index (CPI) for British Columbia (in this case, 3%). Since this rent increase exceeds this amount, it will only be valid if approved for special circumstances as set out in the Residential Tenancy Regulation. Option (1) is incorrect because written notice of a rent increase need only be given to a tenant at least three months before it becomes effective. Option (2) is incorrect because the landlord may apply for approval for this rent increase based on special circumstances. Option (3) is incorrect because a new landlord is not given the right to raise the rent above the set amount (the applicable CPI).

Answer 132

Answer: 4 Explanation: Option (4) is the correct answer because the legal rights of ownership and the physical property will determine the value of a property. The listing price, Option (3), may represent the value to owner, but does not determine the actual value that the property is worth in the market. Option (1) is incorrect because vendor financing may impact the value, but is not a key determinant of value. Option (2) is incorrect because cash-equivalent price represents the market value of a property only if non-market financing was involved in a sale/purchase.

Answer 133

Answer: 3 Explanation: Option (3) is correct because a principal can retroactively ratify a contract which was entered into by his agent without the necessary authority. Ratification expresses the principal’s consent to be bound just as if the agent had been authorized to make the contract in the first place. Option (1) is incorrect because, if the principal ratifies the contract, the contract is valid and the third party is obligated to honour the contract. Option (2) is incorrect because a warranty of authority is an agent’s promise to third parties (not the principal) that his or her actions fall within the scope of authority given by the principal. Therefore, only third parties to whom the warranty of authority is made can sue the agent for breaching the warranty. Option (4) is incorrect because, where a principal adopts a contract which his agent entered into without any authority, the principal (not the agent) becomes a party to that contract.

Answer 134

Answer: 2 Explanation: Option (2) is correct because, in a joint tenancy, co-owners are viewed as a single legal owner against everyone else; and therefore, each owns an undivided interest in the whole of the estate. Option (1) is incorrect because individuals can enter into a joint tenancy regardless of their respective financial contributions to the purchase of the property. Option (3) is incorrect because more than two individuals can enter into a single joint tenancy and because individuals do not have to be married to enter into a joint tenancy. Option (4) is incorrect because each of the following four common law “unities” can be satisfied: (1) all joint tenants must receive their interests at the same time; (2) all joint tenants must receive their interest from the same document; (3) all joint tenants must have the same interest in the land; and (4) all joint tenants must be entitled to possession of the whole estate.

Answer 135

Answer: 3 Explanation: Option (3) is correct because any verification of dated communication helps to give credibility to a statement or allegation. However, verifying the authenticity of electronic documents and email communications is difficult. Further, electronic communication may not stand alone as evidence if there is a question as to the authenticity or origin of the communication. Therefore, keeping hard copies is extremely important from a legal perspective. Options (1), (2), and (4) are incorrect for the same reasons.

Answer 136

Answer: 2 Explanation: Option (2) is correct because marketable securities, accounts receivable, inventories, and prepaid expenses is the correct listing of assets from most to least liquid. Option (1) is incorrect because marketable securities are more liquid than accounts receivable, and accounts payable is not an asset. Option (3) is incorrect because marketable securities are more liquid than accounts receivable, and land is the least liquid asset listed. Option (4) is incorrect because inventory is generally more liquid than prepaid expenses, and the building is the least liquid asset listed.

Answer 137

Answer: 1 Explanation: Option (1) is correct because section 4 of the Real Estate Services Act stipulates that if an agent is unlicensed at the time real estate services were provided, he or she cannot bring a court action to collect commission. Options (2) and (3) are incorrect for the same reason. Option (4) is incorrect because there is no indication, based on the facts presented in this situation, that the listing contract violates the statutory requirements of the Real Estate Services Act.

Answer 138

Answer: 3 Explanation: Option (3) is correct because, under section 47(1)(a) of the Residential Tenancy Act, a landlord may give a tenant a notice of the end of a tenancy if the tenant does not pay the security deposit within 30 days of the date it is required to be paid under the agreement. Option (1) is incorrect because, as per section 47(1)(c) of the Residential Tenancy Act, a landlord may only give a tenant notice of the end of a tenancy for reasons relating to the number of occupants if there are an “unreasonable” number of occupants in the rental unit. Two occupants in a one-bedroom apartment would not be considered unreasonable, and therefore, a landlord could not end a tenancy for this reason. Option (2) is incorrect because Jordan cannot end the tenancy early in order to renovate the warehouse. Jordan must wait until the lease term expires. Option (4) is incorrect because MacGregor must give the tenant at least 2 months’ notice in order to end Mrs. Julian’s tenancy to allow his son to move into the apartment.

Answer 139

Answer: 3 Explanation: Option (3) is correct (false) because there are several organizations that offer mortgage loan insurance such as CMHC, Genworth Financial Canada, and the Canada Guaranty Mortgage Insurance Company. Options (1), (2), and (4) are incorrect because they are true statements.

Answer 140

Answer: 3 Explanation: Option (1) is incorrect because landowners in British Columbia now own or have rights in the airspace above their property only to the extent that they can make effective use of it (not insofar as the owner can see). Option (2) is incorrect because the Government of British Columbia has reserved subsurface rights to gold and silver in favour of the Crown since the time when original Crown grants were made in the 19th century. Option (4) is incorrect because subsurface rights to petroleum have also been reserved in favour of the Crown since 1899; therefore, only landowners whose property was granted by the Crown prior to this date might have ownership of subsurface petroleum (depending on the terms of the original grant).

Answer 141

Answer: 1 Explanation: Option (1) is correct because an owner developer must file a strata plan in order to create a strata development. The strata plan divides the entirely of the building between strata lots and common property. Option (2) is incorrect because cooperative developments are not strata developments, and therefore have no corresponding strata plans. Option (3) is incorrect because strata plans are required for all strata developments. Option (4) is incorrect because restrictive covenants impose restrictions on the use of one person’s land for the benefit of another piece of land. A strata plan does not impose restrictions on “burdened” land for the benefit of some other “benefitted” land. [NOTE: This question has been replaced. Please review your Bulletins posted on your Course Resources webpage.]

Answer 142

Answer: 1 Explanation: Option (1) is correct because a credit analysis evaluates an applicant’s ability to meet the terms of a mortgage and the amount of his or her available for future mortgage payments. Options (2), (3), and (4) are incorrect as they do not describe the primary purpose of a credit analysis of a mortgagor.

Answer 143

Answer: 2 Explanation: Option (2) is correct because under section 55 of the Real Estate Services Rules, a licensee must provide a consumer with a Disclosure of Risks to Unrepresented Parties form when the licensee makes a disclosure under section 54 to an unrepresented party AND the licensee is also representing a client in the same trade in real estate. Options (1), (3), and (4) are incorrect because licensees are not required to make this disclosure to an unrepresented party if the licensee is not also representing a client in the same trade.

Answer 144

Answer: 4 Explanation: Option (4) is correct because a borrower may be unable to make the mortgage payments due to a number of reasons including loss of employment. Option (1) is incorrect because when this occurs, the lender can, but may choose not to, take immediate legal action against the borrower. Options (2) and (3) are incorrect because sometimes it is in the best interest of the lender to grant extra time for the borrower to repay the deficit, but the borrower cannot automatically adjust the payment terms.

Answer 145

Answer: 4 Explanation: Option (4) is correct because general price indices, such as the consumer price index or the shelter price index, are irrelevant to the appraisal of one particular property since changes in the value of consumer products are not necessarily the same as changes in the value of property. Therefore, Options (1), (2), and (3) are incorrect.

Answer 146

Answer: 3 Explanation: Option (3) is correct because appraisers cannot use sale prices for houses recently sold between related parties for comparison purposes. Market value is determined by analyzing market transactions where the buyer and seller have no special relationship (i.e., the sale occurred at arm’s length) and the properties sold are similar (or comparable) to the subject property. Options (1), (2), and (4) are incorrect because with appropriate adjustment, the sale prices of all of these properties can be used for comparison purposes.

Answer 147

Answer: 1 Explanation: Replacement cost of house: $42.50 × 2,600 = $110,500 Land: $41,500 Land + House = $152,000 minus depreciation ($16,300) = $135,700 minus bathroom kitchen fixtures ($13,200) = $122,500 The market value is $122,500.

Answer 148

Answer: 1 Explanation: Option (1) is correct because in relation to the subject property, this comparable has one less bedroom and no alarm system. Options (2), (3), and (4) are therefore incorrect.

Answer 149

Answer: 4 Explanation: To solve this question, calculate the maximum amount of money that can be lent out given the two constraints: the loan-to-value amount and the gross debt service ratio amount. Calculate the loan amount for the loan-to-value constraint and then calculate the loan amount for the GDSR constraint. In order to determine the maximum amount that the lender will advance, choose the lesser of the two results. LTV = 80%

Answer 150

Answer: 3 Explanation: Option (3) is false. Mortgages require a high degree of administrative work such as writing contracts, registering the mortgage charge, and subsequent administration of outstanding balance and refinancing. Options (1), (2), and (4) are incorrect because they are characteristics of a mortgage as an investment.

Answer 151

Answer: 1 Explanation: Option (1) is correct because, at common law, a life tenant is generally under no obligation to repair or compensate for waste that occurs as a result of allowing the property to deteriorate without any positive acts (permissive waste). Option (2) is incorrect because life tenants are liable to the remainderman for direct, positive acts that result in damage to the property beyond the use to which the life tenant is entitled (voluntary waste). Option (3) is incorrect because a life tenant is liable for direct, positive acts which improve rather than destroy the property (ameliorating waste) – but, usually no damages can be awarded, as the property has been improved. Option (4) is incorrect because a life tenant is liable for waste that he or she causes by flagrantly or maliciously damaging or destroying the property (equitable waste).

Answer 152

Answer: 4 Explanation: Option (4) is correct because depreciation expense is used to allocate the cost of a depreciable asset over the course of its life. Option (1) is incorrect because depreciation expense is an accounting framework, whereas capital cost allowance is a taxation framework. Option (2) is incorrect because depreciation expense cannot be deducted from taxable income, whereas capital cost allowance can be. Option (3) is incorrect because land is not a depreciable asset.

Answer 153

Answer: 4 Explanation: Option (4) is correct because real property ownership in British Columbia is based on English common law property rights as modified by legislation such as the Property Law Act and the Land Title Act. Option (1) is incorrect because an owner of an interest in real property in British Columbia may have a number of interests that fall short of a fee simple interest (e.g., life estate, estate pur autre vie, leasehold, etc.). Option (2) is incorrect because the extent of the usage rights enjoyed by an owner of an interest in real property depends heavily upon the type of interest that the owner holds. Additionally, even an owner of real property in fee simple must still abide by various common law restrictions as well as legislative restrictions (e.g., municipalities have the power to regulate subdivision). Option (3) is incorrect because an owner of an interest in real property in British Columbia can have an interest less than a 99-year lease from the Crown (e.g., a lease for a term of less than 99 years).

Answer 154

Answer: 2 Explanation: Find the amount of principal that has been paid off during the 2-year term. Press Display 9.75  NOM% 9.75 2  P/YR 2  EFF% 9.987656 12  P/YR 12  NOM% 9.557657 1500000 PV 1,500,000 20 × 12 = N 240 0 FV 0 PMT 14,038.492319 14038.49 +/ PMT 14,038.49 1 INPUT 24  AMORT PER 1-24 = 55,071.663913 The amount of principal paid off during the 2-year term is $55,072, rounded to the nearest dollar.

Answer 155

Answer: 2 Explanation: Comparable A

Answer 156

Answer: 4 Explanation: Option (4) is correct because each of the scenarios laid out in Options (1), (2), and (3) would terminate the agency authority. Option (1) is incorrect because the doctrine of frustration appears to apply to the agency relationship, meaning that if a house listed for sale burns down, the agency would probably be terminated. Option (2) is incorrect because, the moment the principal sells his or her property, he or she terminates the authority of all listing brokers, no matter what kind of listing agreement they have. The principal may, however, still be liable to pay commission. Option (3) is incorrect because either party to an agency agreement can terminate the authority (orally or by conduct) at will.

Answer 157

Answer: 2 Explanation: Press Display 6 I/YR 6 1  P/YR 1 3500 PV 3,500 1.5 N 1.5 0 PMT 0 0 FV 3,819.678782 The future value of the deposit at an effective annual rate of 6% is $3,819.68. Since the buyer paid the deposit to the seller directly, it reduces the amount of cash that the seller will receive on closing. Therefore, the $3,819.68 will appear as a debit on the seller’s statement of adjustments.

Answer 158

Answer: 4 Explanation: Option (4) is correct because none of the previous statements is true. Option (1) is incorrect because the buyer is not privy to the listing contract, meaning that the buyer owes no rights and has no obligations under the listing contract. Option (2) is incorrect because Clause 1A of the standard form listing agreement created by the British Columbia Real Estate Association requires an “Effective Date” and an “Expiry Date”. Option (3) is incorrect because an open listing provides less protection for the agent than an exclusive listing. This is because, as opposed to an exclusive listing, an open listing does not prevent the seller from employing a number of other brokerages to represent the seller. Commission is only paid to the brokerage who is the effective cause of the eventual sale.

Answer 159

Answer: 1 Explanation: Option (1) is correct because the general rule is that an illiterate person is bound by a contract that he or she has agreed to, unless he or she did not know the general nature of the contract. Therefore, the illiteracy of the offeree, alone, is insufficient to release an offer. Option (2) is incorrect because an offer expires if it is not accepted within the time limit specified in the offer. Option (3) is incorrect because a counter-offer constitutes a rejection of the original offer. Option (4) is incorrect because the offeror can revoke an offer at any time provided that the offeror communicates the revocation to the offeree prior to acceptance.

Answer 160

Answer: 2 Explanation: Option (2) is correct because a central gas fired, forced hot water heating system produces steady and consistent heat. Option (1) is incorrect as this type of heating system does not provide air circulation or filtration. Option (3) is incorrect as this type of heating system must be kept circulating in cold weather otherwise water will freeze and the piping will crack. Option (4) is false because this type of heating system transmits heat through convection and radiation.

Answer 161

Answer: 1 Explanation: Option (1) is correct because the Land Title Act is a body of law written and passed by the provincial government of British Columbia. Option (2) is incorrect because specific performance is a remedy that was developed by the courts of equity, not enacted via government statute. Option (3) is incorrect because the equity of redemption is a doctrine that was developed by the courts of equity, not enacted via government statue. Option (4) is incorrect because Options (2) and (3) are incorrect.

Answer 162

Answer: 3 Explanation: Option (3) is correct because there is a fundamental principle of mortgage law which prohibits “clogging” on “the equity of redemption”. This principle states that the borrower (or the mortgagor) cannot be prevented by the terms of the mortgage from eventually redeeming his or her property free from the conditions contained in the mortgage upon repayment of the loan. An option to purchase a mortgaged property given by the borrower to the lender at the time the mortgage is negotiated, if exercised, would prevent the mortgagor from redeeming his or her property upon repayment, and is therefore void. Option (1) is incorrect because, in mortgage agreements, mortgagors generally covenant to pay all taxes on land and the improvements. Option (2) is incorrect because it is common for a mortgagor to covenant to keep the land and buildings thereof in “good condition and repair”, thereby protecting the value of the security (the property). Option (4) is incorrect because the repayment clause of a mortgage agreement will set out the borrower’s promise to pay the debt and accrued interest according to the schedule agreed upon.

Answer 163

Answer: 4 Explanation: Option (4) is correct because it is true. Option (1) is incorrect because given that the net operating income remains constant, the market value of the property will decline as the required yield rises. Option (2) is incorrect because the market value of an income-producing property is best determined by the yields that prospective purchasers reasonably expect to earn. Option (3) is incorrect because net operating income and gross realized income (also known as “gross realized revenue” or “gross effective income”) are different; net operating income is derived by subtracting operating expenses from gross realized income.

Answer 164

Answer: 3 Explanation: Option (3) is correct because Robert expressly granted Whitney the authority to purchase the deceased’s “paisley motif” Rolls Royce by instructing Whitney not to come away from the auction without buying the automobile under any circumstances. These instructions also granted Whitney the implied authority to purchase the second “pin-striped” automobile since purchasing the second automobile was necessary in order to carry out the express instructions (to purchase the “paisley motif” automobile). Option (4) is incorrect for this reason. Options (1) and (2) are incorrect because they do not describe the full scope of Whitney’s authority.

Answer 165

Answer: 4 Explanation: Option (4) is correct because the “objective/task” method of creating a promotional budget requires that the licensee first determine the objectives of the advertisement, and then determine the desired tasks and activities necessary to reach the objective. This involves defining a “SMART” marketing objective, outlining the tasks required to attain the objective, and estimating the cost of performing these tasks. Option (1) is incorrect because this approach describes the “follow-the-competition” method. Option (2) is incorrect because this approach describes the “SMART” criteria for developing effective business and marketing goals. Option (3) is incorrect because it fails to discuss the step of defining a “SMART” marketing objective.

Answer 166

Answer: 3 Explanation: Given the present and future values of the vacant lot, find the effective annual interest rate. Press Display 1  P/YR 1 200000 +/ PV 200,000 0 PMT 0 3 N 3 300000 FV 300,000 I/YR 14.471424

Answer 167

Answer: 4 Explanation: Option (4) is correct because the MLS® serves many functions, including computing listing searches, producing automated hot sheets, and generating Comparative Market Analysis (CMA) presentations and other client prospecting tools. Options (1), (2), and (3) are incorrect because none of these statements correctly describes a primary function of the MLS®.

Answer 168

Answer: 4 Explanation: This question requires you to compare the effective annual interest rates of Options (1), (2), (3), and (4) with the effective rate of the given nominal rate: Press Display 8  NOM% 8 2  P/YR 2  EFF% 8.16 Option (1) Press Display 7.2  NOM% 7.2 4  P/YR 4  EFF% 7.396743 Option (2) 8.5% per annum, compounded annually is equal to the effective rate.

Answer 169

Answer: 4 Explanation: This question requires you to find an interest rate that would allow you to “double your money” in eight compounding periods. If you invest $100 now to produce a future value of $200, the calculator steps are as follows: Press Display 100 +/ PV 100 200 FV 200 8 N 8 1  P/YR 1 0 PMT 0 I/YR 9.050773 Your investment would double in eight compounding periods if invested at an interest rate of 9.050773% per compounding period.

Answer 170

Answer: 4 Explanation: Option (4) is correct because it correctly describes the interest which is acquired by a buyer of strata lot. Option (1) is incorrect because it describes what is acquired by a buyer of a unit in a cooperative, not a strata lot. Option (2) is incorrect because a buyer of a strata lot does not acquire their interest as a joint tenant with all of the other strata lot owners. If this was the case, then each owner within a given strata would share an undivided interest in the entire property (including each other’s units). Option (3) is incorrect because if the common property was shared via a joint tenancy agreement, then each owner would share a single undivided interest, and ownership could not be allocated in proportion to the unit entitlement.

Answer 171

Answer: 4 Explanation: Press Display 12  P/YR 12 48951.77 PV 48,951.77 548.91 +/ PMT 548.91 180 N 180 0 FV 0 I/YR 10.756093  EFF% 11.302522 2  P/YR 2  NOM% 11.000021 The interest rate is approximately 11% per annum, compounded semi-annually.

Answer 172

Answer: 3 Explanation: This question deals with statements of adjustment and completion of the sale. You must take into account all debits and credits in order to solve for the correct value. Debits: 1st mortgage: $71,000 Taxes + penalty: $1,095 + $105 Commission: $9,300 Credits: Sale price: $155,000 Taxes for August 31 to December 31 that must be paid by the purchaser for the time they live in the property - don’t forget that the purchaser always pays taxes for the completion date and thereafter: 123/365 × $1,095 = $369 Credits ($155,369)  Debits ($81,500) = $73,869

Answer 173

Answer: 4 Explanation: Buyer’s Statement of Adjustments ITEM DEBIT CREDIT Purchase Price 155,000.00 Deposit 5,000.00 1st Mortgage 71,000.00 2nd Mortgage 34,000.00 Buyer's Share of Taxes* 369.00 Conveyancing Fees 600.00 Property Transfer Tax 1,550.00 Balance Due to Complete** _________ 47,519.00 157,519.00 157,519.00 * (Aug. 31-Dec. 31 = 123 days) 123/365  $1,095 = $369 ** Because the total Debits and Credits must balance, in order to find the Balance Due to Complete, you must first calculate the total Debits ($157,519.00) and then subtract the known Credits. The result is the balance due from the buyer to complete the transaction.

Answer 174

Answer: 4 Explanation: Option (4) is correct because credit unions are considered to be institutional lenders that finance their investment by accepting deposits from their members. Private lenders are different from institutional lenders because private lenders typically do not fund their investment by receiving deposits from individuals. Options (1), (2), and (3) are incorrect because they are all examples of private lenders.

Answer 175

Answer: 2 Explanation: Option (2) is correct because, where no time limit is specified, an offer will lapse after a reasonable time has passed. Courts will determine what constitutes a “reasonable” time for acceptance based on the nature of the offer or the nature of what is being sold. Options (1) and (3) are incorrect because there is no set expiration time for offers where no time period is stipulated. Option (4) is incorrect because offers can expire without being revoked by the offeror.

Answer 176

Answer: 2 Explanation: Option (2) is correct because curable functional depreciation refers to an outdated feature that can be corrected economically, such as outdated bathroom fixtures. Options (1), (3), and (4) are incorrect for this reason.

Answer 177

Answer: 2 Explanation: Option (2) is correct because an individual who purchases property, pays the Foreign Buyers’ Tax, and within a year becomes a permanent resident or citizen of Canada, is eligible to claim back the Foreign Buyers’ Tax that he or she paid. Option (1) is incorrect because the tax applies to foreign nationals who are not Canadian citizens or permanent residents of Canada. Option (3) is incorrect because the foreign buyer’s tax applies to foreign corporations. Although the company was incorporated in Canada, it is controlled by a foreign corporation, are therefore would be considered a foreign corporation for the purpose of the tax. Option (4) is incorrect because a Canadian citizen who holds title for a foreign national is considered to be a taxable trustee, and is therefore subject to the tax.

Answer 178

Answer: 2 Explanation: The market value of Mary’s offer is the market value of the mortgage plus her cash down payment. Mary will assume the remaining 24 monthly payments of $1,500.05 and the outstanding balance of $214,838.44. Calculate the market value of the mortgage by determining the PV of the payments and OSB remaining at the end of the original 5-year term based on the current market rate of j2 = 8%. Press Display 8 ■ NOM% 8 2 ■ P/YR 2 ■ EFF% 8.16 12 ■ P/YR 12 ■ NOM% 7.869836 24 N 24 1500.05 +/ PMT 1,500.05 214838.44 +/ FV 214,838.44 PV 216,855.294924 (market value of the mortgage) + 50000 = 266,855.294924 (market value of the offer)

Answer 179

Answer: 1 Explanation: Option (1) is correct because the “better use” test states that the affixation of an object for the purpose of improving the property will be taken as evidence that the object is a fixture, not a chattel (La Salle Recreations Ltd. v. Canadian Camdex Investments Ltd.). Option (2) is incorrect because part two of the test articulated in Stack v. T. Eaton Co. states that articles affixed to the land even slightly are presumed to be part of the land, unless the circumstances show that they were intended to remain as chattels. Option (3) is incorrect because the courts have developed the Stack v. Eaton test, a two part test for determining whether an item is a fixture or a chattel. Option (4) is incorrect because the Stack v. Eaton test examines both the degree of affixation and the purpose of affixation as factors which may overturn the presumption that articles affixed to the land are fixtures.

Answer 180

Answer: 2 Explanation: Press Display 10.5  NOM% 10.5 2  P/YR 2  EFF% 10.775625 12  P/YR 12  NOM% 10.277418 625 +/– PMT –625 300 N 300 0 FV 0 PV 67,325.219664

Answer 181

Answer: 2 Explanation: Option (2) is correct because a graduated payment mortgage has payments that increase on a regular basis over a specified term. Option (1) is incorrect because in a reverse annuity mortgage, there is no repayment until the end of the loan term or the death of the borrower; instead, over the term of the mortgage, the lender advances funds to the borrower. Option (3) is incorrect because in a straight line principal reduction mortgage, the same amount of principal is always paid and the corresponding interest is based on the outstanding balance; therefore, the monthly mortgage payments decrease. Option (4) is incorrect because in an interest accruing mortgage, no payments of interest or principal are made during the life of the loan.

Answer 182

Answer: 4 Explanation: Option (4) is correct because section 3 of the Interest Act states that if a document requires interest to be paid but the rate is not set out then the rate allowed by law is 5% per annum. Option (1) is incorrect because the Interest Act does not require that the rate of interest chargeable under a mortgage be “reasonable”, in the prevailing market for funds. The Interest Act imposes no general cap on mortgage interest rates and states that, except as otherwise provided for by an Act of Parliament, any person may charge “any rate of interest…that is agreed on”. Option (2) is incorrect because the Criminal Code defines a criminal rate of interest as an effective annual rate of over 60%, not 50%. Option (3) is incorrect because section 10 of the Interest Act does not impose a requirement that the mortgage not be for a business purpose in order for an individual to qualify for the right to prepay his or her mortgage. Section 10 applies where: (a) the borrower is an individual; and (b) the mortgage provides that it is not payable for more than five years from the date of the mortgage.

Answer 183

Answer: 2 Explanation: Press Display 12  P/YR 12 21000 +/ PV 21,000 281.72 PMT 281.72 204 N 204 0 FV 0 I/YR 14.771281 (j12)  EFF% 15.13514 (j1) 2  P/YR 2  NOM% 15.233374 (j2) The investor’s expected yield, expressed as a j2 rate is 15.233374%.

Answer 184

Answer: 2 Explanation: Option (2) is correct because a licensee may be held liable for damages caused by a negligent misstatement made to a person with whom they do not have a contractual relationship. For example, a licensee acting for a seller could be held liable for negligent misrepresentation for a statement made to a buyer despite having no contractual relationship with the buyer. Options (1) and (4) are incorrect because the special relationship giving rise to a duty to take care (not to make negligent misstatements) will be created where a skilled person, such as a real estate licensee, gives advice in the course of his or her business to a person who is reasonable going to rely on that advice. Option (3) is incorrect because a skilled person, such as a real estate licensee, can avoid liability for negligent misstatements by giving their advice or opinion with a clear qualification that he or she accepts no responsibility for the accuracy or reliability of the advice.

Answer 185

Answer: 3 Explanation: Option (3) is correct because the mutual exchange of concessions is crucial to effective negotiations. If you enter negotiations unprepared to make concessions it is unlikely that the other party will be willing to do so. Option (1) is incorrect because it is important that concessions occur in a relatively reciprocal fashion. If one party makes repeated concessions without expecting the other party to follow with similar behaviour, this encourages the latter party to hold tight and not participate in the exchange of resources. Option (2) is incorrect because considerable research demonstrates that more optimal solutions are reached when parties do not go issue by issue, and instead package and trade multiple issues simultaneously. Option (4) is incorrect because disclosing your underlying interests will often result in more effective negotiations. If you share your true interests, the other party will often reciprocate. This allows both parties to identify the true needs and desires of each other and then to find creative solutions that will satisfy those needs and desires.

Answer 186

Answer: 4 Explanation: Option (4) is correct because changes to retained earnings are calculated by taking the amount of net income less any dividends paid to shareholders. RE/LAX earned a net income of $234,000 and paid $14,000 in dividends; therefore, the retained earnings account on their balance sheet should increase by $220,000. Option (1) is therefore incorrect. Options (2) and (3) are also incorrect because net income and revenue comes from the income statement rather than the balance sheet.

Answer 187

Answer: 2 Explanation: Option (2) is correct because south facing windows are the most energy efficient in heating. Options (1), (3), and (4) are therefore incorrect.

Answer 188

Answer: 2 Explanation: Option (2) is correct because in terms of appraisal, “recent” refers to the time period for which supply and demand conditions have not changed or have remained relatively stable. Options (1), (3), and (4) are therefore incorrect.

Answer 189

Answer: 4 Explanation: Option (4) is correct because a caveat is a note placed on a certificate of title by a person claiming an interest in land that temporarily prevents all dealings (e.g., transfers, mortgages, etc.) with the land inconsistent with the estate or interest claimed by the caveator. Option (1) is incorrect because caveats are not issued by the Prosecutor’s Office. Option (2) is incorrect because a caveat is a temporary “freezing” measure. If a party commences a court action concerning the property, then a certificate of pending litigation can be registered against the property to provide formal notice of that court action. Option (3) is incorrect because builder’s liens are registered as charges on title, not as caveats.

Answer 190

Answer: 4 Explanation: Option (4) is correct because it is unlikely that 100% occupancy will be reached in most properties. Option (1) is incorrect because vacancy rates are expressed as a percentage of gross potential revenue. Option (2) is incorrect because vacancy rates are not considered an operating expense; they are an allowance for reductions in gross potential revenue attributable to vacancies, tenant turnover, and nonpayment of rent or other income. Option (3) is incorrect because vacancy allowance is determined by the long-term vacancy rates in the area; therefore, it does not matter if the subject property has never had any vacancies before.

Answer 191

Answer: 1 Explanation: Option (1) is correct because since total assets = total liabilities on a balance sheet, if the total assets for The Mountain Bike Emporium = $185,900 and the only liabilities were accounts payable of $2,900 and long-term debt of $89,450, the amount of owner’s equity = $93,550 ($185,900 – $2,900 – $89,450). Options (2), (3), and (4) are therefore incorrect.

Answer 192

Answer: 3 Explanation: Option (3) is correct because according to the cost principle, an asset must be recorded for the amount that was paid for it. Options (1), (2), and (4) are incorrect because they are true statements.

Answer 193

Answer: 3 Explanation: Option (3) is correct because quantum meruit is the doctrine that no one who benefits by the labour and material of another should be unjustly enriched thereby. In the circumstances of this question, the law will invoke quantum meruit to imply a promise (given by Joe to Harry) to pay a reasonable about for the delivery of the groceries, even though a specific contract price was not agreed to. Option (1) is incorrect for the same reason. Option (2) is incorrect because the delivery of groceries does not fall within the scope of the Real Estate Services Act. Option (4) is incorrect because section 54 if the Law and Equity Act deals with waiver of conditions precedent, not payment for services.

Answer 194

Answer: 4 Explanation: Option (4) is correct because, in order to offend section 52 and section 74.01 of the Competition Act, a representation must be “false or misleading in a material respect”. Despite being strictly false, understating the square footage of a condo by merely 2 square feet would likely be insufficient to constitute a material misrepresentation. Option (1) is incorrect because misrepresenting a strata unit as having two bedrooms when it only has one would be considered false and misleading in a material respect. Option (2) is incorrect because section 52 prohibits reckless misrepresentations, and falsely advertising a house as having a recently renovated kitchen without first investigating the matter would be considered reckless. This false advertisement would also offend section 74.01, since section 74.01 imposes no requirement that the deceptive practices were made knowingly or recklessly. Option (3) is incorrect because advertising homes starting at $700,000 when the lowest priced home is, in fact, priced $300,000 higher, would be considered false and misleading in a material respect.

Answer 195

Answer: 2 Explanation: Option (2) is correct because the Occupiers Liability Act imposes a duty on occupiers of premises (in this case, the owner and/or building manager) to take such care as in all the circumstances is reasonable to see that persons coming onto the property (in this case, the visitor) will be reasonably safe. In this scenario, the visitor can argue that this duty was not met because the skylight collapsed, inuring him. Option (1) is incorrect because, based on the facts provided, no untrue statement was made by the owner or the building manager to the visitor. Option (3) is incorrect because, on these facts, there is nothing that establishes a fiduciary duty owed by the owner or the building manager to the visitor (a fiduciary duty is a special type of duty imposed only in select situations). Option (4) is incorrect because the collapse of the skylight did not interfere with the visitor’s use and enjoyment of the visitor’s own property.

Answer 196

Answer: 1 Explanation: Option (1) is correct because the seller will be liable because he, as the principal: (a) is responsible for the acts of his agent and (b) expressly authorized the tort. Option (2) is incorrect because an agent can never escape liability for torts committed by the agent on the basis that the agent was authorized by the principal to commit them. Option (3) is incorrect because the inclusion of this clause in the contract of purchase and sale gives the vendor protection against innocent misrepresentations; however, it will not protect the vendor in the case of fraudulent misrepresentation. Option (4) is incorrect because, as previously mentioned, the buyer can also bring an action for damages against the licensee. The buyer can also sue for rescission of the contract.

Answer 197

Answer: 3 Explanation: Option (3) is correct because all companies must have an official records office. At that office, any person can look over the incorporation documents of the company. Option (1) is incorrect because the common law has been altered by statute to make it possible for companies incorporated under the Business Corporations Act to ratify a pre-incorporation contract by act or conduct. Option (2) is incorrect because different ratification rules apply to companies operating in British Columbia that are incorporated under federal or another province’s legislation. These rules may, therefore, restrict the legal capacity of a corporation to enter a contract.

Answer 198

Answer: 3 Explanation: Option (3) is correct because the Real Estate Services Rules (the “Rules”) restate these duties so that the British Columbia Financial Services Authority can initiate disciplinary proceedings against the licensee independently of any common law action that a client may bring against the licensee. Option (1) is incorrect because the client will not be able to receive additional damages under the Rules. Option (2) is incorrect because a client can only bring action against a licensee for breaching his or her common law duties, not for a breach of the Rules. Option (4) is incorrect because when the Rules simply restate a common law fiduciary duty, it will not be easier (or more difficult) to prove a breach of either.

Answer 199

Answer: 2 Explanation: Press Display 6  NOM% 6 2  P/YR 2  EFF% 6.09 12  P/YR 12  NOM% 5.926346 99200 PV 99,200 300 N 300 0 FV 0 PMT 634.68817 The monthly payment required to amortize the loan is $634.69.

Answer 200

Answer: 3 Explanation: Option (3) is correct because the wall-to-wall carpeting that Akiko removed is most likely a fixture, and therefore was included in the purchase price (i.e., should have remained with the property when it was sold). Per Stack v. T. Eaton Co., articles affixed to the land even slightly – as the wall-to-wall carpeting is – are presumed to be part of the land. The purpose of affixing the carpeting was most likely to improve the den; therefore, the presumption that the carpeting is a fixture is unlikely to be overturned. Option (1) is incorrect because a throw rug is not attached to the land (except by its own weight), and therefore is presumed to be a chattel. Unless stipulated in the contract of purchase and sale, chattels are excluded from the purchase price of real property. Option (2) is incorrect because the stained glass window is most likely a chattel. The stained glass window, being attached (via hooks), will initially be presumed a fixture (per Stack v. T. Eaton Co.). However, this presumption is easily overturned. The window is affixed only slightly, being hung on two hooks, and therefore is quite easily removed. Additionally, since the antique window is merely hung in front of the living room window, it serves no apparent structural function. Therefore, the purpose of affixing the stained glass window is most likely to better enjoy the window as a decorative piece (similar to a painting), rather than to improve the land.

Answer 201

Answer: 3 Explanation: Option (3) is the correct answer. Appraisals are required to determine the value of real property because it is difficult to find properties that are very much alike. Unlike real property, other financial assets such as stocks are more homogenous and will have an explicitly determined price. Options (1), (2), and (4) are incorrect.

Answer 202

Answer: 3 Explanation: Option (3) is correct because concrete framing is the most common type of construction today for high-rise apartment buildings. This is because most high-rise residential buildings normally require a two-hour fire-rating for floors and columns and concrete will achieve this rating without any additional protection for most applications. Options (1), (2), and (4) are incorrect.

Answer 203

Answer: 3 Explanation: Option (3) is correct because it is the owner’s responsibility to comply with work orders from public authorities in respect of a strata lot. This is why section 85 of the Strata Corporation Act requires owners to reimburse the strata corporation for the cost of work done by the strata corporation following the owner’s failure to comply with a work order from a public or local authority under section 85 of the Act. Option (1) is incorrect because the Strata Property Act requires the strata corporation to obtain and maintain full-replacement-value property insurance against harm to the common property. Option (2) is incorrect because the Strata Property Act requires every strata corporation to have an operating fund for common expenses that usually occur one or more times each year. Option (4) is incorrect because the Strata Property Act requires every strata corporation to establish a contingency reserve fund for expenses that usually occur less often than once a year or that do not usually occur.

Answer 204

Answer: 3 Explanation: Option (3) is correct because Deborah, as Susan’s agent, owed Susan a duty to make complete disclosure of everything relevant to the transaction within Deborah’s knowledge. Regardless of whether or not Deborah thought that the redevelopment would increase or decrease the value of the property, Deborah had a duty to advise Susan of the redevelopment because it might in some way have affected Susan’s decision. Option (4) is incorrect for the same reason. Option (1) is incorrect because, where an agent has breached any duties to the principal, which Deborah has done, the agent’s right to commission will probably be lost. Therefore, Susan likely does have a claim against Deborah for the commission paid to Susan. In addition, Susan may have a potential claim against Deborah if she can prove that the property could have been sold for more had Deborah advised her of the redevelopment. Option (2) is incorrect because, in this scenario, Deborah did not owe a duty to Jennifer (a third party) not to advise Susan of the redevelopment.

Answer 205

Answer: 2 Explanation: Option (2) is correct because local enterprise zones are not a level of local law created under the Local Government Act. Options (1), (3), and (4) are incorrect because these are all levels of local government.

Answer 206

Answer: 2 Explanation: Option (2) is correct because Alan should register a caveat, which will prevent the transfer of the property, and stay on the register for two months. This will give Alan time to commence a court action, if he so chooses. Option (1) is incorrect because Luke is not yet able to file a Certificate of Pending Litigation, because a court action has not yet been commenced. Option (3) is incorrect because Alan has not yet obtained a judgment against Luke, and thus is not able to register a judgment. Option (4) is incorrect because Alan has not obtained an Order of Possession, and thus is not yet entitled to hire a bailiff.

Answer 207

Answer: 1 Explanation: Option (1) is correct because the buyer in a real estate transaction assumes responsibility for the taxes from the adjustment date onwards. Since Pat is assuming responsibility for the taxes on January 1, the first day of the year, no adjustment is necessary. Remember that property taxes are paid for a calendar year, even though they are usually due on July 1. Options (2), (3), and (4) are incorrect, because no adjustment is necessary for property taxes in this scenario, and therefore property taxes will not appear as a debit or credit on either the buyer’s or seller’s statement of adjustments.

Answer 208

Answer: 4 Explanation: Option (4) is the correct answer (and Options (1), (2), and (3) are incorrect) as the farmhouse situated on land zoned for commercial use is likely to be the only option that has redevelopment potential.

Answer 209

Answer: 1 Explanation: Option (1) is correct because when using a rating grid, the subject property is the standard of comparison and each comparable sale is adjusted to it. The subject property is not adjusted to the comparables nor are the comparables adjusted to each other. Option (2) is incorrect because the correct approach is to determine which comparable is most like the subject property and use that as main evidence for the final market value, not to average the value of the comparable sale prices. Option (3) is incorrect because the comparable properties do not require the same square footage of improvements as the subject property. Option (4) is incorrect because the comparable properties need not have the same lot size as the subject property.

Answer 210

Answer: 4 Explanation: Option (4) is correct and Options (1), (2), and (3) are incorrect because since the comparable does not have an alarm system and the subject property does, there is a +$4,500 adjustment for the alarm system. In addition, since the subject property has 200 square feet less than the comparable, an adjustment for –$12,000 is also required.

Answer 211

Answer: 3 Explanation: Option (3) is correct (false) because the value of the comparable must be adjusted downwards to account for the benefit provided by the below-market vendor financing. Options (1), (2), and (4) are incorrect because they are true.

Answer 212

Answer: 1 Explanation: Option (1) is correct because to find the adjusted sale price of the comparable, take the sum of the listed sale price with its adjustments to the subject property. In this case, the subject property and the comparable are identical except that the subject property has 1 additional bedroom, 1 additional bathroom, and 100 square feet less. The adjusted sale price is: $245,000 + $4,000 +$5,700 – $6,000 = $248,700. Options (2), (3), and (4) are therefore incorrect.

Answer 213

Answer: 3 Explanation: Option (3) is correct because marketable securities is the only account listed that is classified as a current asset. Option (1) represents an owner’s equity account, Option (2) represents a current liability account, and Option (4) represents a revenue account.

Answer 214

Answer: 3 Explanation: Option (3) is correct because geographic information system (GIS) mapping is a form of computer-based mapping that incorporates several layers of information beyond what a traditional map can tell you. GIS maps can integrate details on lot size and dimensions, zoning bylaws applicable to the parcel, ownership details, environmental restrictions, etc. Options (1), (2), and (4) do not perform this function.

Answer 215

Answer: 2 Explanation: Option (2) is correct because an interest accruing loan represents the greatest risk to the lender, since the entire amount of principal and interest is at risk for the entire length of the term. Options (1), (3), and (4) represent loans with lesser risk to the lender.

Answer 216

Answer: 2 Explanation: Option (2) is correct because depreciation expense is an accounting concept that attempts to allocate the cost of an asset over the life of the asset. Option (1) is incorrect because capital cost allowance and depreciation expense are separate frameworks that both attempt to allocate the cost of an asset over the asset’s life. The difference is that depreciation expense is used for financial statements, and capital cost allowance is used for tax deductions. Option (3) is incorrect because land is not a depreciable asset. Option (4) is incorrect because this option describes the CCA framework.

Answer 217

Answer: 2 Explanation: Option (2) is correct because, in Canada, the courts of equity and the common law courts are combined, meaning that judges in all provinces (except Quebec) can apply both common law and equitable principles in deciding cases brought before them. Option (1) is incorrect for the same reason. Option (3) is incorrect because, where there is a conflict between common law and equitable principles, equitable principles take priority. Option (4) is incorrect because Option (2) is true.

Answer 218

Answer: 1 Explanation: For an interest accruing loan, all the interest will be paid at the end. Press Display 8 I/YR 8 12  P/YR 12 60000 PV 60,000 12 N 12 0 PMT 0 FV 64,979.970409

Answer 219

Answer: 4 Explanation: Option (4) is the correct answer. Option (1) is incorrect because under section 49 of the Residential Tenancy Act, a landlord may end a tenancy agreement if they intend to renovate or repair a rental unit in a manner that requires it to be vacant. Option (2) is incorrect because if a tenant intends to return, they will have a right of first refusal to enter into a new tenancy agreement. Option (3) is incorrect the landlord has the right to determine the rate of rent in the new tenancy agreement.

Answer 220

Answer: 4 Explanation: To solve for the outstanding balance owing at the end of the term, first determine the monthly payment under the loan. Take ½ of that monthly payment as the accelerated payment. Then change the interest rate to an equivalent j26 rate, and using ½ of the regular monthly payment, solve for the outstanding balance at the end of the term. Press Display 4  NOM% 4 2  P/YR 2  EFF% 4.04 12  P/YR 12  NOM% 3.967068 300000 PV 300,000 300 N 300 0 FV 0 PMT 1,578.060616 ÷ 2 = 789.030308 790 +/ PMT 790 4  NOM% 4 2  P/YR 2  EFF% 4.04 26  P/YR 26  NOM% 3.963543 1 INPUT 130  AMORT PER 1-130 = = = 252,210.347253 The outstanding balance owing at the end of the 5-year term is $252,210.35.

Answer 221

Answer: 4 Explanation: Option (4) is correct because the owner of a freehold strata lot holds a fee simple interest in the strata lot, and a proportionate fee simple interest in the common property as a tenant in common. Option (1) is incorrect because a fee simple interest is held in both the strata lot and the common property. Option (2) is incorrect because the fee simple interest in the common property is held as a tenant in common, not as a joint tenant. Option (3) is incorrect because a strata lot owner possesses a fee simple interest in the strata lot, rather than merely a license to occupy the strata lot.

Answer 222

Answer: 4 Explanation: Press Display 6.5  NOM% 6.5 2  P/YR 2  EFF% 6.605625 12  P/YR 12  NOM% 6.413688 225000 PV 225,000 20 × 12 = N 240 0 FV 0 PMT 1,666.12593 1667 +/ PMT 1,667 12 INPUT  AMORT = = = 219,260.013804 The monthly payment is $1,667 and the outstanding balance after 12 payments is $219,260.01. The three months’ interest penalty equals:

Answer 223

Answer: 1 Explanation: P + I = (GDSR  Gross Income) B Property Taxes P + I = (0.32  $55,000) B $2,000 P + I = $15,600 per year = $1,300 per month The mortgage qualifying rate is based on the greater of (1) the government-specified qualifying rate of j2 = 5.25% OR (2) an additional 2% above the mortgage’s negotiated contract rate. In this case, you would apply a rate of j2 = 5.25%, the government-specified rate, which is greater than 2% above the mortgage’s negotiated contract rate [j2 = 4.95% (2% + 2.95%)]. Press Display 5.25  NOM% 5.25 2  P/YR 2  EFF% 5.318906 12  P/YR 12  NOM% 5.193482 1300 +/ PMT 1,300 240 N 240 0 FV 0 PV 193,829.998812 Given the stress test borrower qualification rules, the maximum loan that will be granted is $193,830.

Answer 224

Answer: 2 Explanation: Option (2) is correct because Part 4 of the Assessment Act provides for the establishment of Property Assessment Review Panels as the first level of appeal from property assessments. Any person who is dissatisfied with the Property Assessment Review Panel’s decision may appeal to the Property Assessment Appeal Board. An appeal on a point of law may subsequently be made from the Property Assessment Appeal Board to the Supreme Court of British Columbia. Finally, an appeal can be made from the Supreme Court of British Columbia to the Court of Appeal, but only on a point of law raised by the lower court judge. Options (1), (3), and (4) are incorrect for this reason.

Answer 225

Answer: 4 Explanation: To answer this question, calculate the maximum amount of money that can be lent out given the two constraints: the loan-to-value amount and the gross debt service ratio amount. Calculate the loan amount for the loan-to-value constraint and then calculate the loan amount for the GDSR constraint. In order to determine the maximum amount that the lender will advance, choose the lesser of the two results. LTV = 80%

Answer 226

Answer: 2 Explanation: Option (2) is correct because revocation must always be actually communicated to be effective. Option (1) is incorrect because an offeror can revoke their offer at any time prior to acceptance, regardless of whether or not the previously stated time limit has expired. Option (3) is incorrect because there is no requirement that the offeror give reasonable notice to the offeree before revoking the offer. Option (4) is incorrect because there is no requirement that the offeror give any pre-determined period of notice before revoking the offer.

Answer 227

Answer: 1 Explanation: Option (1) is correct because section 60 of the Real Estate Services Rules prohibits entering into an agreement for payment on the basis of a net listing, which is the difference between the price at which real estate is listed for sale, lease or other disposition, and the actual amount realized. Options (2), (3), and (4) are incorrect because this type of commission arrangement is expressly prohibited under section 60 of the Real Estate Services Rules, and therefore cannot be agreed to.

Answer 228

Answer: 4 Explanation: Option (4) is correct because when a loan has a term that is shorter than the amortization period, it is a partially amortized loan, i.e., a partially amortized repayment scheme. Options (1), (2), and (3) are therefore incorrect.

Answer 229

Answer: 4 Explanation: Option (4) is the correct answer as interest rates on treasury bills represent short-term national economic factors. Options (1), (2), and (3) represent longer-term economic factors.

Answer 230

Answer: 4 Explanation: For this question, calculate the NOI from the information given. Then, use the given yield/cap rate on the comparable property to estimate the value of the subject property. Note that gross realized income is given, not the gross potential income. This means that you only have to deduct expenses from gross realized income to determine NOI.

Answer 231

Answer: 3 Explanation: Since you would sell the house for its market value, the market value and sale price are the same.

Answer 232

Answer: 3 Explanation: Option (3) is correct because a mortgage is a document evidencing a debt, which carries with the mortgagor’s (or borrower’s) equitable right to redeem the property on payment of the debt. Options (1), (2), and (4) are therefore incorrect.

Answer 233

Answer: 3 Explanation: Using the cost method of appraisal, calculate the market value of Mr. Jones’ property. The market value is calculated by finding the replacement value, subtracting depreciation, and adding the site value.

Answer 234

Answer: 2 Explanation: Lengthening the amortization period means that more time is allowed for the borrower to pay off the loan. For constant payment mortgage loans, the initial first payments are composed of a greater portion of interest, whereas the last payments are composed of a greater portion of principal payments. Below is an example demonstrating changes in amortization. This example has a 5-year amortization period; calculate OSB24. Press Display 10  NOM% 10 2  P/YR 2  EFF% 10.25 12  P/YR 12  NOM% 9.797815 60 N 60 100000 PV 100,000 0 FV 0 PMT 2,114.769835 2114.77 +/ PMT 2,114.77 24 INPUT  AMORT PER 24-24 = = = 65,732.530034 Now extend the amortization period to a 10-year amortization period and calculate OSB24. The calculator steps continue as follows: Press Display 120 N 120 PMT 1,310.336742 1310.34 +/ PMT 1,310.34 24 INPUT  AMORT PER 24-24 = = = 86,964.980905 As in the example above, increasing the amortization period will increase the OSB at time 24. Therefore, Option (2) is correct. Your payments have decreased and you are stretching out the time needed to pay of off the loan. You are paying more interest, and since interest is paid more at the beginning than at the end of the loan, your payments on principal are delayed; therefore, at each point in time, the amount outstanding on your principal will be greater.

Answer 235

Answer: 4 Explanation: Press Display 12 I/YR 12 12  P/YR 12 0 PMT 0 60 N 0 500000 +/ FV 500,000 PV 275,224.807969

Answer 236

Answer: 2 Explanation: Option (2) is correct because a personal brand is a reflection of self and how other people (including existing and future clients) perceive the licensee. It comprises the theme of the licensee’s personal business and through a variety of attributes, it distinguishes the licensees from competitors. Therefore, Options (1), (3), and (4) are incorrect.

Answer 237

Answer: 1 Explanation: Option (1) is correct because section 56 of the Real Estate Services Rules requires a licensee to disclose to his or her brokerage the full amount of commission received or anticipated as a result of providing real estate services. Option (2) is incorrect because at common law, an agent is any person who contracts to act for or on behalf of another. Therefore, failing to tell anyone of this $3,000 payment does not breach the common law principles of agency law. Option (3) is incorrect because Option (2) is false. Option (4) is incorrect because Option (1) is true.

Answer 238

Answer: 1 Explanation: Option (1) is correct because section 2 of the Strata Property Act states that the owners of the strata lots in the strata plan are members of the strata corporation, once the strata plan is deposited in the land title office. Option (2) is incorrect because the strata corporation includes all of the individual strata owners, not just elected representatives. Option (3) is incorrect because strata owners own privately owned (divided) strata lots in fee simple, and own common property as tenants in common. Option (4) is incorrect because a strata corporation is comprised of the individual strata owners collectively, not a group of professional managers hired to perform this role.

Answer 239

Answer: 2 Explanation: Option (2) is correct because a landlord can give notice to end a tenancy so that a family member can occupy the premises, but only if this potential occupier is the landlord, or a spouse, child, or parent of the landlord or landlord’s spouse. Option (1) is incorrect because a landlord may end a tenancy if the tenant or a person permitted on the residential property by the tenant has significantly interfered with or unreasonably disturbed another occupant or the landlord of the residential property. Option (3) is incorrect because a landlord may end a tenancy if rent is a tenant is repeatedly late paying rent. Option (4) is incorrect because a landlord may give the tenant a notice of the end of the tenancy if the tenant does not pay the security deposit within 30 days of the date it is required to do so under the tenancy agreement.

Answer 240

Answer: 1 Explanation: Option (1) is correct because a trustee is an individual or entity in whose name a property is held, in trust for the benefit of another person, known as the beneficiary. Option (2) is incorrect because the person who the property is held for the benefit of is known as the beneficiary. Option (3) is incorrect because while an executor may seek assistance in handling a transfer of title from an estate, the title will normally be put into the name of the executor, rather than a financial institution. Option (4) is incorrect because the family members or friends of an incapable person will typically be appointed to make decisions on their behalf, and the Public Guardian and Trustee is generally only appointed where none are available or willing to act.

Answer 241

Answer: 4 Explanation: Option (4) is correct because the Standard Bylaws can be amended by a strata corporation passing their own bylaw restricting pets, and is therefore false. Option (1) is incorrect because Karl purchased his lot after the bylaw was passed, and is therefore true. Option (2) is incorrect because bylaws prohibiting pets do not apply to pets living with an owner, tenant, or occupant at the time the bylaw is passed, and is therefore true. Option (3) is incorrect because the Strata Property Act allows for pet restriction bylaws to be passed, and is therefore true.

Answer 242

Answer: 1 Explanation: Option (1) is correct because the most common advertising contravention for which a penalty may be imposed is failing to display the name of a licensee’s brokerage on an advertisement in a “prominent and easily readable way” as is required under section 40(2) of the Rules. Option (2) is incorrect because it is the second most common advertising contravention. Option (3) is incorrect because it is the third most common advertising contravention. Option (4) is incorrect because this is included in the third most common advertising contravention.

Answer 243

Answer: 1 Explanation: The accelerated bi-weekly payment is ½ of the regular monthly payment. Press Display 4  NOM% 4 2  P/YR 2  EFF% 4.04 12  P/YR 12  NOM% 3.967068 315000 PV 315,000 240 N 240 0 FV 0 PMT 1,903.376364 ÷ 2 = 951.688182 The accelerated bi-weekly payment is $952, rounded up to the next higher dollar.

Answer 244

Answer: 4 Explanation: Option (4) is correct because if a person standing on the porch is able to look straight down a hallway into the main bathroom when the front door is open, this is not considered to be physical curable depreciation but rather functional and likely incurable. Option (1) is incorrect because this is considered a design deficiency in today’s market. Options (2) and (3) are incorrect because this describes a patent defect since it is visible, and functional depreciation under the cost approach of appraisal.

Answer 245

Answer: 2 Explanation: Option (2) is correct because section 3(1) of the Occupiers Liability Act requires an occupier of premises to take that care that in all the circumstances is reasonable to see that a person will be reasonably safe in using the premises. By taking these steps, it is likely that Laura met the requisite standard of care and would not be liable. Option (1) is incorrect because an occupier owes a duty of care under the Occupiers Liability Act even to trespassers, unless they are trespassing while committing or having the intention to commit a criminal act. Option (3) is incorrect because an occupier is defined in the Occupiers Liability Act as a person who is in physical possession of premises, and does not depend on the length of the lease. Option (4) is incorrect because Laura will only be liable to Howard for his damages if she breached the standard of care owed to Howard, making her negligent.

Answer 246

Answer: 4 Explanation: For this question, invest $100 today (PV) that grows to $200 (FV) to reflect a doubling of funds over six years. Press Display 100 +/ PV 100 200 FV 200 6 N 6 1  P/YR 1 0 PMT 0 I/YR 12.246205

Answer 247

Answer: 1 Explanation: To solve this problem, first convert the nominal interest rate, compounded monthly, to an annual effective rate so that the frequency of compounding matches the frequency of the payments. Since there is no payment being made today, there is no present value in this calculation. Then, enter the payments of $8,000 and compute the future value that would be available at the end of seven years. Press Display 6  NOM% 6 12  P/YR 12  EFF% 6.167781 1  P/YR 1  NOM% 6.167781 0 PV 0 7 N 7 8000 +/ PMT 8,000 FV 67,495.21364 At the end of seven years, the investor will have accumulated $67,495.21 in the account.

Answer 248

Answer: 1 Explanation: Option (1) is correct because in British Columbia, under the Torrens system of land title registration, all mortgages are registered as charges against the title. Options (2), (3), and (4) are incorrect because mortgages are registered only as charges.

Answer 249

Answer: 3 Explanation: Option (3) is correct because a truss is a prefabricated frame component that supports the roof. Option (1) refers to a dormer, Option (2) refers to a header, and Option (4) refers to one of the many components of a septic tank.

Answer 250

Answer: 4 Explanation: The market value of Alex’s offer is the market value of the mortgage plus his cash down payment. Alex will assume the remaining 233 monthly payments of $900. Calculate the market value of the mortgage by determining the PV of the remaining payments based on the current market rate of j2 = 6%. Press Display 6  NOM% 6 2  P/YR 2  EFF% 6.09 12  P/YR 12  NOM% 5.926346 900 +/ PMT 900 0 FV 0 233 N 233 PV 124,410.889524 (market value of the mortgage) + 35000 = 159,410.889524 (market value of the offer) The market value of the offer is $159,410.89.

Answer 251

Answer: 1 Explanation: Option (1) describes the correct order of components in a wood-frame exterior wall from the inside out. Options (2), (3), and (4) are incorrect because any other order of these components will result in undesirable appearance or function of the walls.

Answer 252

Answer: 1 Explanation: Option (1) is correct because between 1900-1920, interest only loans were the primary form of repayment for residential mortgage financing. After the Depression, long-term fully amortized loans were the primary form of repayment for residential mortgage financing. Options (2), (3), and (4) are therefore incorrect.

Answer 253

Answer: 4 Explanation: Option (4) is correct because a patent defect will not discharge a contract as the principle of “caveat emptor” (let the buyer beware) applies, and so the purchaser must take the risk of these patent defects. Option (1) is incorrect because a contract can be discharged by an agreement between the parties to waive full compliance with the terms of the contract. Option (2) is incorrect because a contract can be discharged by frustration. Option (3) is incorrect because once the final act of performance occurs, the contract is discharged.

Answer 254

Answer: 3 Explanation: Option (3) is correct because a licence is a contractual agreement and so does not “run with the land” and bind successors in title as an interest in land would. The distinction between a licence and a lease is based on intention based on whether the parties to the agreement intend to grant an interest in land, or simply create a licence to occupy. Option (1) is incorrect because Larry granted a licence, not a lease. Option (2) is incorrect because the agreement is a licence and therefore is not enforceable against successors. Option (4) is incorrect because the agreement is a licence.

Answer 255

Answer: 2 Explanation: Option (2) is correct because both a broker and a representative employed by the broker can be disciplined jointly. Option (1) is incorrect because the Real Estate Services Act grants power to the British Columbia Financial Services Authority (BCFSA) to subject brokers to disciplinary hearings for the actions of their representatives, and therefore is true. Option (3) is incorrect because section 43 of the Real Estate Services Act allows for the suspension of the broker’s licence, and is therefore true. Option (4) is incorrect because the Real Estate Services Act requires that BCFSA publish all orders on its website and provide copies to any person upon request, and is therefore true.

Answer 256

Answer: 2 Explanation: Option (2) is correct because plates, studs, and lintels are found in the wall frame. Options (1), (3), and (4) are therefore incorrect.

Answer 257

Answer: 4 Explanation: Option (4) is correct because capital gains are exempt from taxation where the property sold was the seller’s principal residence. Options (1), (2), and (3) are incorrect because they do not fall within the principal residence exception, and either 50 or 100% of the profit realized on the sale of the property would be taxed depending on whether it is considered a true capital gain or instead, business income.

Answer 258

Answer: 4 Explanation: Option (4) is correct because the deposit paid directly to the seller will reduce the cash proceeds to be received by the seller upon completion, which is reflected as a debit, and will reduce the balance due from the buyer to complete, which is reflected as a credit. Options (1) and (3) are incorrect because the amount of the deposit will appear both on the buyer’s and seller’s statements of adjustments. Option (2) is incorrect because the amount will appear as a credit on the buyer’s statement and a debit on the seller’s statement.

Answer 259

Answer: 3 Explanation: Option (3) is correct because specific performance is an equitable remedy granted at the discretion of the court and will not be exercised when damages are considered to be an adequate remedy. Option (1) is incorrect because a limited company can be granted specific performance at the court’s discretion. Option (2) is incorrect because a court can award specific performance if a defendant is without means. Option (4) is incorrect because even if the contract has already been partially performed, the court still has the discretion to award specific performance.

Answer 260

Answer: 3 Explanation: This question is solved in two parts. First, calculate the interest rate on the mortgage, which will be a j12. Then, convert the interest rates to the equivalent j1, j2, and j4 to see if they match any of the answers. Press Display 12  P/YR 12 48951.77 PV 48,951.77 520 +/ PMT 520 180 N 180 0 FV 0 I/YR 9.797818 This does not match with the j12 rate of Option (1). Therefore, we must test the other options to find the correct equivalent rate. Continuing the calculator steps, find the equivalent j1, j2, and j4 rates: Press Display  EFF% 10.250003 2  P/YR 2  NOM% 10.000003 4  P/YR 4  NOM% 9.878033 Options (2) and (4) do not match; therefore, the answer is Option (3).

Answer 261

Answer: 3 Explanation: Option (3) is correct because a corporation is owned by one or more shareholders. Option (1) is incorrect because a corporation is a separate legal entity, and so can be sued just as a natural person can be. Option (2) is incorrect because shareholders are liable only for the value of the shares purchased or agreed to be purchased, and have no further responsibility for the debts of the company once the cost of their shares have been fully paid. Option (4) is incorrect because a corporation has its own income tax status, and pays tax at a flat rate.

Answer 262

Answer: 1 Explanation: Option (1) is correct because firewalls are hardware and software boundaries frequently used to prevent unauthorized users from accessing private computers or networks connected to the internet. All data attempting to pass through the firewall is blocked unless it meets a certain criteria of authorization needed to pass through. Options (2), (3), and (4) are incorrect as they do not describe the purpose of firewalls.

Answer 263

Answer: 4 Explanation: Option (4) is correct because it is not a common covenant of the borrower to waive rescission rights. Option (1) is incorrect because this is a substantial clause commonly used which states that the mortgagor will duly pay all taxes, levies and assessments whatsoever affecting the land and all premiums for insurance effected pursuant to this mortgage. Option (2) is incorrect because this is a substantial clause commonly used which states that the mortgagor will keep the land and the buildings thereof in good condition and repair, and he will not abandon or commit waste upon the same. Option (3) is incorrect because this provision can be found in column 1 of the Land Transfer Form Act, Part 3, and is also a substantial clause commonly used instead of the standard clause contained in column 1.

Answer 264

Answer: 3 Explanation: Press Display 6 I/YR 6 12  P/YR 12 350000 PV 350,000 25 × 12 = N 300 0 FV 0 PMT 2,255.054905 2256 +/ PMT 2,256 12 INPUT  AMORT PER 12-12 = = = 343,758.20544 The monthly payment is $2,256 and the outstanding balance after 12 payments is $343,758.21. The three months’ interest penalty equals:

Answer 265

Answer: 1 Explanation: Option (1) is correct because anti-virus and malware protection programs include an auto-update feature (automatic update) that instructs the program to download profiles (also called definitions) of new viruses and malware from the manufacturer’s website. Options (2), (3), and (4) do not describe typical auto-update features.

Answer 266

Answer: 2 Explanation: Option (2) is correct because the terms rise and run refer to the specification of stair sizes. The rise is the height difference of each step, and the run is the depth of the step. Options (1), (3), and (4) are incorrect because rise and run are not typically used to describe windows, framing, or roofs.

Answer 267

Answer: 2 Explanation: Option (2) is the best evidence of market value due to the similarity and recency of the sale. Option (1) is incorrect because the list price of the property is a subjective value, and appraisers are interested in the objective value that arises from a sale. Option (3) is incorrect because it appears that the property was not at its highest and best use, and that it was purchased by a special purchaser. Option (4) is incorrect as the rushed motivation to sell may have an unpredictable influence on the sale price.

Answer 268

Answer: 1 Explanation: The first step for this question is to calculate the monthly payment and outstanding balance owing at the end of the 5-year term based on the contract interest rate; the second step is to calculate the market value of the mortgage based on the market rate; the final step is to calculate the market value of the offer. Since each unit is priced at $132,000 and the mortgage loan is for $102,000, the down payment is $30,000. To calculate the market value of the offer, add the cash down payment to the market value of the mortgage. Press Display 9.25  NOM% 9.25 2  P/YR 2  EFF% 9.463906 12  P/YR 12  NOM% 9.076624 102000 PV 102,000 240 N 240 0 FV 0 PMT 922.752986 922.75 +/ PMT 922.75 60 INPUT  AMORT PER 60-60 = = = 90,570.109331 90570.11 +/ FV 90,570.11 8  NOM% 8 2  P/YR 2  EFF% 8.16 12  P/YR 12  NOM% 7.869836 60 N 60 PV 106,834.620887 (market value of the mortgage) + 30000 = 136,834.620887 (market value of the offer) The market value of the offer is $136,835, rounded to the nearest dollar.

Answer 269

Answer: 2 Explanation: Option (2) is correct. Option (1) is incorrect because an appeal from the small claims court is taken to the British Columbia Supreme Court. Option (3) is incorrect because the Supreme Court of Canada can decide not to hear an appeal from the BC Court of Appeal. Option (4) is incorrect because an appeal from the small claims court is at the BC Supreme Court and is heard by one judge.

Answer 270

Answer: 3 Explanation: Option (3) is correct because, in British Columbia, the indefeasibility principle means that any registered owner who acquires a fee simple estate in good faith (honestly) and for valuable consideration (a reasonable price, given the circumstances and market value) is protected by our land title system. In other words, if a person is named on a certificate of title as the owner of the fee simple estate in land, then that is conclusive proof, as far as the world is concerned, that he or she is entitled to that fee simple estate. Option (1) is incorrect because it describes the common law doctrine of the void deed which was overruled by the principle of indefeasibility. Option (2) is incorrect because it also describes the common law doctrine of the void deed, which is sometimes referred to as nemo dat quad non habet, or “one cannot give what one does not have”. Option (4) is incorrect because the principle of indefeasibility relies on a certificate of title, and not who the previous owner names as the new owner of an estate in land.

Answer 271

Answer: 4 Explanation: Find the amount of principal that has been paid off during the 5-year term. Press Display 6 NOM% 6 2  P/YR 2 EFF% 6.09 12  P/YR 12  NOM% 5.926346 250000 PV 250,000 25 × 12 = N 300 0 FV 0 PMT 1,599.516559 1599.52 +/ PMT 1,599.52 1 INPUT 60  AMORT PER 1-60 = 25,408.479189 The amount of principal paid off during the 5-year term is $25,408.48.

Answer 272

Answer: 2 Explanation: Option (2) is correct because if the landlord and tenant do not enter into a new agreement before the expiry date, and the tenant continues to occupy the premises, the landlord and the tenant are presumed to have renewed the original agreement as a month-to-month tenancy. Therefore, Options (1), (3), and (4) are incorrect.

Answer 273

Answer: 1 Explanation: In this question, solve for the future value. Press Display 2.5 I/YR 2.5 1  P/YR 1 0 PV 0 4 N 4 6000 +/ PMT 6,000 FV 24,915.09375

Answer 274

Answer: 4 Explanation: Option (4) is correct because a rafter is the structural member that supports the roof deck. Option (1) refers to a dormer, Option (2) refers to a header, and Option (3) refers to a specific roof style.

Answer 275

Answer: 4 Explanation: Option (4) is correct because the process model of buying behaviour helps explain how consumers go about the purchase of shopping goods (i.e., real estate services) and looks at the buying process from the consumer’s perspective. A felt need is the initial need or trigger that starts the buying process. In real estate, many events can trigger the felt need to buy or sell a property. Options (1), (2), and (3) are incorrect because they are not the correct term for this initial trigger in the process model for buying behaviour.

Answer 276

Answer: 4 Explanation: Option (4) is correct because reminder-oriented messages focus on keeping the product, service, or licensee at the consumer’s “top-of-mind.” Option (1) is incorrect because informational messages are designed to provide information and create awareness. Option (2) is incorrect because persuasive messages are aimed at generating a response from the recipient, such as making a phone call or sending an e-mail. Option (3) is incorrect because appeal message is a term not used in this course.

Answer 277

Answer: 4 Explanation: Option (4) is correct. Option (1) is incorrect because if the seller has already paid the current year’s taxes, the seller must be reimbursed for that portion of the year from and including the adjustment date. This will be a debit to the buyer and a credit to the seller. Option (2) is incorrect because the seller is responsible for the full amount of any penalty. It is not adjusted because only the seller was liable to pay and failed to do so in a timely manner. The buyer would be debited their portion of taxes from the adjustment date to December 31, and the seller would be credited the buyer’s portion of taxes and debited the whole year’s taxes due plus any late penalties. Option (3) is incorrect because if the taxes are not yet due, an estimate of the charge will have to be made.

Answer 278

Answer: 1 Explanation: Option (1) is correct because the value of the subject property calls for the adjustment of +$4,200 and we know that the market value of one bedroom is $4,200. So if the subject property is adjusted up by $4,200, we know that the subject property must have one more bedroom than the comparable (4 bedrooms in subject). There is a –$2,600 adjustment for bathrooms; therefore, the subject property has one less bathroom than the comparable (3 bathrooms in subject). Therefore, Options (2), (3), and (4) are incorrect.

Answer 279

Answer: 4 Explanation: Option (4) is correct because in the comparative approach of appraisal, it is most important that the subject building and the comparable buildings be similar with respect to factors judged important by buyers and sellers. Options (1), (2), and (3) are incorrect because similarity is only required for those factors that have a material influence on buyers and sellers, and the sale prices they negotiate.

Answer 280

Answer: 3 Explanation: Option (3) is correct because an owner of a fee simple estate has the greatest bundle of rights over his or her land that can be held in Canada, which includes the right to sell, rent, or lease the estate. Option (1) is incorrect because the term “fee” means that the estate can be inherited. Option (2) is incorrect because if the owner of a fee simple estate dies without a will, the owner’s heirs will inherit the estate in fee simple with the priority of the heirs being determined by the laws of intestate succession. Option (4) is incorrect because a fee simple estate has rights to the land for so long as he or she has heirs.

Answer 281

Answer: 3 Explanation: Option (3) is correct. Option (1) is incorrect because where the rules of equity and common law conflict, equitable principles take priority. Option (2) is incorrect because equitable remedies are awarded at the discretion of the court. Option (4) is incorrect because damages are a common law remedy.

Answer 282

Answer: 2 Explanation: Option (2) is correct because unlike in residential tenancies, there is no general obligation on either the landlord or tenant to repair commercial premises. Option (1) is incorrect because the contract does not have to be registered to be enforceable between the parties. Option (3) is incorrect because there is an implied covenant that the tenant will deliver up the premises as he or she found them, fair wear and tear excepted. Option (4) is incorrect because there is no obligation on the landlord to repair.

Answer 283

Answer: 2 Explanation: For this question, set the present value equal to $23,000; solve for the future value of the investment. N is set to 20 because there are two semi-annual periods in each year (2 × 10 = 20). Press Display 6 I/YR 6 2  P/YR 2 20 N 20 23000 +/ PV 23,000 0 PMT 0 FV 41,540.558397

Answer 284

Answer: 1 Explanation: Option (1) is correct because a deposit is not required in order for a contract of purchase and sale to be enforceable. Options (2), (3), and (4) are incorrect because they are all requirements for an enforceable contract of purchase and sale.

Answer 285

Answer: 4 Explanation: Option (4) is correct because fixed-term residential tenancies automatically convert to a month-to-month periodic tenancy unless the parties have agreed in writing otherwise. Option (1) is incorrect because the resulting periodic tenancy does not include a rent increase of ten percent. Option (2) is incorrect because if the rent was expressed yearly, the new implied tenancy would be from year-to-year. Option (3) is incorrect because a periodic commercial tenancy can be terminated by either party by giving “reasonable” notice to the other.

Answer 286

Answer: 3 Explanation: Option (3) is the correct answer as it is the only option listed that is not a motivation to invest in real estate. Investing in real estate is typically long term, and requires a high outlay of capital, so it will not provide short-term funds to acquire chattels. Options (1), (2), and (4) are incorrect because they are all primary motives to invest.

Answer 287

Answer: 3 Explanation: Option (3) is correct because ownership can be divided. Options (1), (2), and (4) are significant characteristics of improved land.

Answer 288

Answer: 1 Explanation: Option (1) is correct because the role most often played by legislation is to change the common law. Option (2) is incorrect because the common law develops a system of precedent. Option (3) is incorrect because the power of the government to make laws is set out in our Constitution, which cannot be amended by an ordinary statute. Option (4) is incorrect because legislation is not used as a means to publicize important judicial decisions.

Answer 289

Answer: 1 Explanation: Option (1) is correct because this transfer of personal property is a credit to the buyer as it reduces the amount that the buyer owes, and is a debit to the seller as it reduces the amount of cash proceeds of sale due to the seller. Options (2) and (3) are incorrect because this transfer will appear on the statement of adjustment of both the buyer and seller. Option (4) is incorrect because a debit to the buyer would increase the amount owed to the seller, and a credit to the seller increases the cash the seller will receive on closing.

Answer 290

Answer: 2 Explanation: Option (2) is correct because the common law provides tenants with various rights such the right to quiet enjoyment and the right to derogation from grant. Options (1) and (3) are incorrect because the Commercial Tenancy Act and Rent Distress Act apply to commercial, not residential, tenancies.

Answer 291

Answer: 3 Explanation: Option (3) is the correct answer because a transportation facility is the only option that is likely to be both a positive and a negative externality. The transportation facility is likely to be positive because of easier access to transit, as well as negative due to unwanted noise and traffic. Options (1), (2), and (4) are incorrect as they represent only a positive or a negative externality.

Answer 292

Answer: 4 Explanation: Set the face value of $217,200 equal to the present value. To calculate the nominal interest rate that the investor will earn, change the present value to $220,500, the amount that the investor pays. Press Display 11.5 I/YR 11.5 12  P/YR 12 217200 PV 217,200 240 N 240 0 FV 0 PMT 2,316.28516 2316.29 +/ PMT 2,316.29 220500 PV 220,500 I/YR 11.267747(j12)  EFF% 11.868261(j1) 2  P/YR 2  NOM% 11.535586(j2)

Answer 293

Answer: 4 Explanation: Option (4) is correct because these are all amounts owed by the buyer. Option (1) is incorrect because the balance due to complete is a credit on the buyer’s statement of adjustments. Option (2) is incorrect because the deposit paid and the balance due to complete are credits on the buyer’s statement of adjustments. Option (3) is incorrect because these are all credits on the buyer’s statement of adjustments.

Answer 294

Answer: 4 Explanation: Option (4) is correct because Elisa is responsible for 48/365 days for property taxes as the buyer is responsible for the adjustment date. The total property taxes is estimated to be $1324 × 1.1 = $1456.40. Therefore, Elisa’s portion is $1456.40 × (48/365) = $191.53. This is a debit on the seller’s statement of adjustments as it will reduce the cash proceeds due to her. Option (1) is incorrect because this value does not reflect the expected 10% increase in the current year’s property taxes. Options (2) and (3) are incorrect because the seller’s portion of the property taxes appears as a debit on the seller’s statement as it reduces the cash proceeds due to the seller.

Answer 295

Answer: 2 Explanation: Option (2) is correct because the brokerage’s commission of $10,220, the seller’s portion of property taxes of $191.53, the assumption of Anya’s first mortgage of $123,544, the second mortgage of $23,000, and the discharge fees for the second mortgage of $75 are all debits on the seller’s statement, and the sale price of $448,000 is a credit on the seller’ statement. Options (1), (3), and (4) are incorrect because the cash proceeds of sale which will be received by Anya is $290,969.47. Seller’s Statement of Adjustments (Anya) ITEM DEBIT CREDIT Purchase Price 448,000.00 Commission 10,220.00 Seller's Share of Taxes* 191.53 Assumption of 1st Mortgage 123,544.00 Discharge of 2nd Mortgage 23,000.00 Legal Fees (discharge of 2nd Mortgage) 75.00 Cash Proceeds of Sale** 290,969.47 _________ 448,000.00 448,000.00 * $1,324  1.10 = $1,456.40 (Jan. 1-Feb. 17 = 48 days)

Answer 296

Answer: 3 Explanation: Option (3) is correct because the debits on the buyer’s statement of adjustments include the sale price of $448,000, property transfer tax of $6,960, conveyancing fees of $700, and fees for the preparation of Kenny’s new mortgage of $250, and the credits include the deposit of $25,000, the seller’ portion of the tax of $191.53, the assumption of the first mortgage of $123,544, and the second mortgage of $98,000. Options (1), (2), and (4) are incorrect because the balance due to complete is $209,174.47. Buyer’s Statement of Adjustments (Kenny) ITEM DEBIT CREDIT Purchase Price 448,000.00 Deposit to Notary 25,000.00 Seller's Share of Taxes* 191.53 Assumed (1st) Mortgage 123,544.00 2nd Mortgage 98,000.00 Conveyancing Fee 700.00 Mortgage Preparation 250.00 Property Transfer Tax 6,960.00 Balance Due to Complete** _________ 209,174.47

Answer 297

Answer: 4 Explanation: Option (4) is correct because a common shareholder of a corporation is liable only for the value of the shares purchased or agreed to be purchased. Option (1) is incorrect as each common share allows for one vote at the annual general meeting of the corporation. Options (2) and (3) are incorrect as common shareholders indirectly share the income of the corporation, in the form of dividends.

Answer 298

Answer: 1 Explanation: Option (1) is correct because when a property possesses latent value it is implied that the property is not currently employed at its highest and best use, and this latent value could be realized if the property were redeveloped to the highest and best use. Options (2), (3), and (4) are incorrect because they are not implications of latent value.

Answer 299

Answer: 3 Explanation: For this question, convert the rate from a j1 to a j12 and then calculate the future value. Press Display 6.5  NOM% 6.5 1  P/YR 1  EFF% 6.5 12  P/YR 12  NOM% 6.314033 5000 +/ PV 5,000 0 PMT 0 18 N 18 FV 5,495.338081

Answer 300

Answer: 1 Explanation: Option (1) is correct because while a fee simple estate is the greatest estate in land, the owner of the estate in fee simple is not the absolute owner. This is because underlying title in all land in British Columbia is held by the Crown. Option (2) is incorrect because a fee simple estate does not always have clear title. Option (3) is incorrect because the term “fee simple” is still used today to describe the greatest interest in land, and has not been abolished. Option (4) is incorrect because fee simple is a form of estate in land.

Answer 301

Answer: 4 Explanation: The first step is to calculate the monthly payments at the contract rate; the second step is to calculate the OSB at the end of the term and set this equal to the future value; the third step is to calculate the market value of the mortgage at the market rate. The final step is to add on the down payment to find the market value of the townhouse. Press Display 5  NOM% 5 2  P/YR 2  EFF% 5.0625 12  P/YR 12  NOM% 4.948699 90000 PV 90,000 300 N 300 0 FV 0 PMT 523.444487 523.44 +/ PMT 523.44 60 INPUT  AMORT PER 60-60 = = = 79,657.06119 79657.06 +/ FV 79,657.06 7  NOM% 7 2  P/YR 2  EFF% 7.1225 12  P/YR 12  NOM% 6.900047 60 N 60 PV 82,968.212749 (market value of the mortgage) + 85000 = 167,968.212749 (market value of the offer) The market value of the offer is $167,970, rounded to the nearest $10.

Answer 302

Answer: 3 Explanation: Option (3) is correct because a registered fee simple acquired bona fide for value without knowledge of an earlier fraudulent dealing in the land is indefeasible. Options (1), (2), and (4) are correct because these are all exceptions to the indefeasibility principle.

Answer 303

Answer: 4 Explanation: Option (4) is correct because it is the responsibility of a real estate board to enforce the Code of Ethics and Standards of Business Practices, not the Superintendent of Real Estate (the “Superintendent”). Options (1), (2), and (3) are incorrect because they are all duties of the Superintendent as stated in the Real Estate Services Act.

Answer 304

Answer: 4 Explanation: Option (4) is correct because the common law rule of interesse termini provides that no estate in land passes until the tenant takes possession. Option (1) is incorrect because a term which is contrary to the Commercial Tenancy Act is void and unenforceable. Option (2) is incorrect because the implied covenant of quiet enjoyment is an assurance to the tenant against the consequences of a defective title. Option (3) is incorrect because section 32 of the Residential Tenancy Act states that a tenant is not required to make repairs for reasonable wear and tear.

Answer 305

Answer: 2 Explanation: Option (2) is correct and Options (1), (3), and (4) are incorrect because generally, a brokerage must retain records for at least seven years after their creation (section 92 of the Real Estate Services Rules).

Answer 306

Answer: 2 Explanation: Option (2) is correct because specific performance and injunctions are equitable remedies available at the discretion of the court. Option (1) is incorrect because a judge cannot refuse to apply a law which is unfair. Option (3) is incorrect because in the common law system of British Columbia, judges may refer to common law and statute law, but not to a code to ascertain the law. Option (4) is incorrect because a judge cannot refuse to apply any law which is unfair, and cannot refer to a code to ascertain the law.

Answer 307

Answer: 4 Explanation: Option (4) is correct and Options (1), (2), and (3) are incorrect because a reverse annuity mortgage is an innovative loan arrangement where the lender makes periodic payments to the borrower and at the end of the term, the borrower repays the balance.

Answer 308

Answer: 4 Explanation: Option (4) is correct if a court issues a judgment against the strata corporation, the judgment is against all the owners. Options (1), (2), and (3) are incorrect because the Strata Property Act permits these remedies.

Answer 309

Answer: 1 Explanation: To calculate the depreciation expense for Fanny’s building, calculate the value of the building minus the salvage value. This will give us the amount to be depreciated. The straight-line depreciation expense equals the amount to be depreciated divided by the number of years.

Answer 310

Answer: 1 Explanation: Value of the building: $225,000  $100,000 = $125,000

Answer 311

Answer: 4 Explanation: Option (4) is correct because an equitable mortgage cannot be prohibited by statue. If a mortgage is unregistrable for procedural reasons, then it is an equitable mortgage. Options (1), (2), and (3) are incorrect because they are all examples of equitable mortgages.

Answer 312

Answer: 4 Explanation: Option (4) is correct because interests in land are said to “run with the land”, so the doctrine of privity of contract does not apply to contracts creating an interest in land. Option (1) is incorrect because the easement is enforceable between Scott and Alice because the easement is an interest in land which is not subject to the doctrine of privity of contract. Option (2) is incorrect because since interests in land “run with the land”, and do not “run with the owner”. Option (3) is incorrect because all interests in land “run with the land”, not only rights of way.

Answer 313

Answer: 1 Explanation: Option (1) is correct; the Canadian Electrical Code requires minimum electrical service capacity of 100 amps for houses at least 80 square meters. Most houses of this size will have greater electrical service capacity of 125, 150, or 200 amps. Options (2), (3), and (4) are therefore incorrect.

Answer 314

Answer: 3 Explanation: Option (3) is correct because a registered property owner who is a widow or widower may make an application to defer the property taxes payable on their principal place of residence. Options (1), (2), and (4) are incorrect because this deferral program does not extend to members of parliament, divorcee’s, or war veterans.

Answer 315

Answer: 3 Explanation: Option (3) is correct because a deposit is not an essential element of a binding contract. The 7 essential elements are offer, acceptance, consideration, legal intention, capacity, legal object, and genuine consent. Options (1), (2), and (4) are incorrect because they are all essentials for the formation of a binding contract.

Answer 316

Answer: 2 Explanation: For this question, use the following three formulas:

Answer 317

Answer: 4 Explanation: Option (4) is correct because an easement or right-of-way, building scheme, and leasehold are all interests in land that can be valued. An easement or right-of-way affects the value of the properties involved depending on the location of the easement. A building scheme, which is a type of restrictive covenant, must benefit or enhance the value of the covenantee’s land in some way. A leasehold estate has great economic value and grants important rights to land. Options (1), (2), and (3) are incorrect because they are all interests in land that can be valued.

Answer 318

Answer: 3 Explanation: Note: We are given the gross realized revenue, so vacancy is already included. A reminder: Gross potential revenue  vacancy = gross realized revenue Find the yield/cap rate of Comparable A and B, then determine a range for the market value of the subject property using these two cap rates.

Answer 319

Answer: 3 Explanation: Option (3) is correct (false); the maximum CCA in a given year is equal to the undepreciated capital cost (UCC) multiplied by the CCA percentage. Options (1), (2), and (4) are incorrect because they are true.

Answer 320

Answer: 3 Explanation: Option (3) is correct because in 2001, CMHC launched Canada Mortgage Bonds to increase the supply of low cost mortgage funds in Canada, and provide easy access to investment in Canadian residential mortgages. The Canada Mortgage Trust is the organization created by CMHC that issues these bonds. Options (1), (2), and (4) are incorrect because the CMHC did not create virtual banks, Ginnie Mae Mortgage-Backed Securities, or credit unions.

Answer 321

Answer: 4 Explanation: Option (4) is correct because Options (1), (2), and (3) are all incorrect. Option (1) is incorrect because Larry is liable to the buyer in negligence because he did not exercise reasonable care and skill by relying only on information from the seller. Option (2) is incorrect because the seller does have a duty to disclose this defect to the buyer because it is likely a latent defect. Option (3) is incorrect because the seller can still be liable for misrepresentation because there is a relationship between the seller and the buyer giving rise to a duty of care.

Answer 322

Answer: 3 Explanation: Option (3) is correct because if a party seeking to enforce the contract has reasonably relied on the existence of a contract and in doing so has altered his or her position, a court may enforce the contract if only its enforcement will prevent an unfair result. Option (1) is incorrect because the Law and Equity Act writing requirement applies even when a buyer and seller agree on the terms of the sale. Option (2) is incorrect because a contract not in writing is not void, but may be unenforceable. Option (4) is incorrect because if the party denying the contract has done some act that indicates the contract was made, they will be “estopped” from denying its existence.

Answer 323

Answer: 1 Explanation: Option (1) is correct because a real estate professional has an ethical duty to present all options, which is implicit in the duty to advise fully, candidly and honestly. Therefore, Options (2), (3), and (4) are incorrect.

Answer 324

Answer: 2 Explanation: Option (2) is correct because Devco has potentially breached various statutes. Option (1) is incorrect because this could potentially be a breach of the federal Competition Act which is designed to hold business actors accountable for misleading, deceptive, or anti-competitive practices. Option (3) is incorrect because the Real Estate Services Rules prohibits licensees from knowingly publishing real estate advertising containing any false statement or representation concerning real estate, a trade in real estate, or the provision of real estate services. Option (4) is incorrect because the Real Estate Services Rules requires licensees to disclose their interests in the property to potential buyers.

Answer 325

Answer: 2 Explanation: Option (2) is correct because when a life estate is created for one party with the remainder going to another party in fee simple, the interest the second party holds is known as a remainderman. Therefore, Options (1), (3), and (4) are incorrect.

Answer 326

Answer: 3 Explanation: Option (3) is correct because making a substantial change to Mary’s offer would be considered a counter-offer. The counter-offer becomes the new offer, which terminates the original offer. Option (1) is incorrect because if acceptance by mail is appropriate, then the “postal acceptance rule” applies, making the acceptance effective as soon as it is put in the mailbox, rather when it is actually received. Option (2) is incorrect because the party who made the offer can revoke it at any time before it is accepted. Option (4) is incorrect because while a counter-offer terminates the original offer, an offeree’s minor request for information does not terminate an offer.

Answer 327

Answer: 2 Explanation: For this question, calculate the mortgage amount based on the two constraints of the loan-to-value and debt service ratio. The maximum loan allowable will be the amount that satisfies both constraints: therefore, it is the lower amount of the two. LTV = 80%

Answer 328

Answer: 3 Explanation: The loan-to-value ratio is the maximum loan divided by the lending value.

Answer 329

Answer: 3 Explanation: Option (3) is correct because under the Constitution Act, 1867, the provincial governments were given jurisdiction over matters affecting private property and were also empowered to delegate some provincial powers to local governments. Option (1) is incorrect because the Constitution Act, 1867 gave the provincial government jurisdiction over matters affecting private property, not the federal government. Option (2) is incorrect because although the province has delegated most authority to regulate land use to local governments, the provincial government has maintained certain power such as through the Agricultural Land Commission Act. Option (4) is incorrect because the Heritage Conservation Act also gives local governments the authority to impose restrictions on a private landowner’s use of their land.

Answer 330

Answer: 2 Explanation: Option (2) is correct because Mr. Falcon’s need for a quick sale is likely to result in a lower sale price. Options (1), (3), and (4) are incorrect because they would not cause Mr. Finch’s home to sell for a lower value.

Answer 331

Answer: 3 Explanation: Option (3) is correct because unless there is an express prohibition in the lease, a tenant under a commercial lease may assign without the consent of the landlord. Option (1) is incorrect because a commercial tenant can assign a lease unless the lease expressly prohibits them from doing so. Option (2) is incorrect because the landlord is not required to give his/her consent for an assignment of a commercial lease. Option (4) is incorrect because a tenant can assign a commercial lease even if the lease permits subletting the premises.

Answer 332

Answer: 2 Explanation: Option (2) is correct because at common law, once a “break” in the chain of title occurred, all subsequent transfers or other dealings with the land were of no effect because of the maxim nemo dat quod non habet. Option (1) is incorrect because the current “owner” would lose the title and would have no remedy other than to sue the person from whom he or she had bought the land. Option (3) is incorrect because a deed given in exchange for an illegal act or thing is a void deed. Option (4) is incorrect because a current fee simple “owner” could have certainty of title after the 20 year limitation period for lawsuits to recover a land title transferred by a void deed had expired.

Answer 333

Answer: 2 Explanation: The correct answer is Option (2) because a property with a particularly attractive view may be worth much more than a property without a view. Option (1) is incorrect; the quality of aesthetic factors that can be corrected economically, such as landscaping, do not have an impact on appraised values. Option (3) is also incorrect because a one-year difference in age in a relatively new home is unlikely to have a material impact on appraised values. Option (4) is incorrect because the weather is unlikely to have a material impact on appraised values.

Answer 334

Answer: 1 Explanation: Cost Salvage ValueAnnual Depreciation ExpenseEstimated Life (years)=185,000 5,000 9= $20,000= Book value after 3 years = Cost – Total Depreciation = $185,000 – ($20,000 × 3) = $125,000

Answer 335

Answer: 2 Explanation: Option (2) is correct because it is only an offence under section 52 of the Competition Act if the false advertisement is misleading in a material respect. Option (1) is incorrect because the forms of advertising covered by section 52 are extremely broad, and include representations in print, oral, and digital form. Option (3) is incorrect because the courts will consider both the literal meaning and general impression of the advertisement to determine whether the representation is false or misleading in a material respect. Option (4) is incorrect because an accused may escape liability under section 52 if they honestly believed that the representation or advertisements were not false or misleading and that they exercised due diligence in making sure that was the case.

Answer 336

Answer: 4 Explanation: Option (4) is correct because authority can be revoked by an act of the principal that is inconsistent with the continuation of authority. Options (1), (2), and (3) are incorrect because these events will not terminate a real estate agency relationship.

Answer 337

Answer: 3 Explanation: Option (3) is correct because in an agreement for sale, the vendor “lends” the purchaser some portion of the purchase price but remains the owner of the property. The purchaser repays this amount to the vendor by way of instalments, and the vendor transfers title to the purchaser when the entire amount has been repaid. Therefore, Options (1), (2), and (4) are incorrect.

Answer 338

Answer: 1 Explanation: Option (1) is correct because a person selling a neighbour’s house for a flat fee is not exempted from the requirements to be licensed under the Real Estate Services Act. Option (2) is incorrect because appraisers and property inspectors are exempted from having a license with respect to trading services. Option (3) is incorrect because accountants in relation to purchase and sale of a business are exempted. Option (4) is incorrect because employees of developers are exempted.

Answer 339

Answer: 1 Explanation: Option (1) is correct because section 49 of the Real Estate Services Rules prohibits licensees from making a promise to buy or sell any real estate belonging to a prospective buyer unless at the time the licensee makes the promise, he or she gives a signed statement containing the details of the promise to the person to whom it is made. Option (2) is incorrect because a trading services representative does not have to have lined up a buyer for the property before making a promise to buy or sell any real estate belonging to a prospective buyer. Option (3) is incorrect because a trading services representative is not required to first obtain authorization by the brokerage before making such a promise. Option (4) is incorrect because the Real Estate Services Act does not prohibit these promises from being made.

Answer 340

Answer: 3 Explanation: At the end of the term, the borrower will owe an outstanding balance of $178,877.95. Set this number equal to the FV and then calculate the payment. Press Display 7.5 I/YR 7.5 12  P/YR 12 195000 PV 195,000 60 N 60 178877.95 +/– FV –178,877.95 PMT –1,441.039997 The monthly payment is $1,441.04.

Answer 341

Answer: 4 Explanation: Option (4) is correct because copyright law protects software. Option (1) is incorrect because even though you pay a price for software, it is licensed to the user, not an “ownership” purchase. Option (2) is incorrect because the licence agreement contains a fair use clause, which restricts copying the software for friends, colleagues, and making copies for resale. Option (3) is incorrect because copying and reselling software is generally not legally permissible.

Answer 342

Answer: 3 Explanation: Option (3) is correct because the Strata Property Act does not permit a strata corporation to prohibit strata lot owners from selling their lots to non-residents of British Columbia. Option (1) is incorrect because the Strata Property Act permits a strata corporation to control, manage, and administer the common property and common assets of the corporation for the benefit of the owners. Option (2) is incorrect because the Strata Property Act permits the strata corporation to file a lien in the land title office against a strata lot for money owing to the corporation. Option (4) is incorrect because the Strata Property Act permits a strata corporation to deny an owner, tenant, occupant, or visitor the use of the recreational facility that is common property for a reasonable length of time.

Answer 343

Answer: 2 Explanation: Option (2) is correct because an agent’s authority to act on behalf of his principal may not arise contingently. Options (1), (3), and (4) are incorrect because an agency relationship is commonly created expressly, by implication, or by ratification by the principal of the agent’s acts done on the principal’s behalf.

Answer 344

Answer: 1 Explanation: For this question, calculate the mortgage amount based on the constraints of loan-to-value and debt coverage ratio. The maximum loan allowable will be the amount that satisfies both constraints; therefore, it is the lower amount of the two. LTV constraint: $880,000 × 0.80 = $704,000 Using DCR constraint, calculate maximum allowable payments.

Answer 345

Answer: 4 Explanation: Option (4) is correct because the factory was in compliance with the industrial use permitted by the zoning bylaw when it was built, and so it will be permitted to continue as a legal non-conforming use after the area is rezoned to residential use. Option (1) is incorrect because this is an example of an illegal secondary suite. The fact that the municipality is aware of the suite does not make the suite legal; rather, the city could elect to enforce its bylaws at any time. Option (2) is incorrect because the grocery was non-compliant with the bylaw even before it was amended, so the use was never legal. Option (3) is incorrect because an addition cannot be made to a building used for a non-conforming use unless it is required by law or permitted by a board of variance.

Answer 346

Answer: 4 Explanation: Option (4) is correct because section 44 of the Residential Tenancy Act states that a tenant vacating or abandoning the rental unit will result in the end of a tenancy agreement. Option (1) is incorrect because a residential landlord cannot distrain a tenant’s goods for arrears of rent. Option (2) is incorrect because section 32 of the Residential Tenancy Act imposes an obligation on the landlord to repair all types of residential premises. Option (3) is incorrect because there is no obligation to register a lease of three years or less to secure a tenant’s rights against subsequent owners of the leased premises.

Answer 347

Answer: 4 Explanation: Option (4) is correct because a manufactured home is not required to be registered. Option (1) is incorrect because under section 7 of the Manufactured Home Act, the transfer is not effective, except between the parties to the transfer, unless both the home and the transfer are registered. Option (2) is incorrect because the Manufactured Home Act prohibits any person from importing into British Columbia unless ownership is registered. Option (3) is incorrect because the registrar will assign a manufactured home a registration number upon satisfactory completion of the initial registration, and issue two decals bearing that number.

Answer 348

Answer: 3 Explanation: Option (3) is correct because a wood-fired space heater may not provide steady consistent heat. Rooms that are not space heated will remain cool. Options (1), (2), and (4) are incorrect because they are true. A wood-fired space heater can reduce the overall heating expense by providing an additional source of heat that does not rely on electricity or gas. This type of heating is frequently described as comfortable heat because it provides both radiant and convection heat. In addition, thermostatic controls for temperature and circulation fans are available.

Answer 349

Answer: 4 Explanation: Option (4) is correct because the undertaking and carrying out of real estate law reform is a duty of the Real Estate Foundation, not the British Columbia Financial Services Authority (BCFSA). Option (1) is incorrect because according to the Real Estate Services Act, states that BFCSA is responsible for issuing real estate licenses. Option (2) is incorrect because BCFSA may conduct investigations and hold formal disciplinary processes. Option (3) is incorrect because according to section 53.1 of the Real Estate Services Act, BCFSA may require the licensee to pay the expenses, or part of the expenses, incurred in relation to either or both of the investigation and the discipline hearing to which the order relates.

Answer 350

Answer: 1 Explanation: Option (1) is correct because using proven anti-virus and malware software is the most simple, effective, and reliable method of protecting against viruses. Therefore, Options (2), (3), and (4) are incorrect.

Answer 351

Answer: 1 Explanation: Option (1) is correct because a misrepresentation is a false statement of fact, not of opinion. Option (2) is incorrect because in order to be a misrepresentation that would entitle the buyer to rescind the contract, the statement must have induced the other party to enter into the contract. Option (3) is incorrect because the statement must also be one which would have induced a reasonable person to enter into the contract. Option (4) is incorrect because in order to claim damages, the seller must have known it was false, or have been reckless as to its truth or falsehood.

Answer 352

Answer: 3 Explanation: Option (3) is correct because damages that are not reasonably foreseeable are considered too “remote” in law, and a plaintiff will not be able to get compensation for them. Option (1) is incorrect because a claim for negligence is concerned with whether the defendant breached the standard of care owed, not whether they intended to cause injury or damage to the plaintiff. Option (2) is incorrect because this is a required element for a successful claim of negligence. Option (4) is incorrect because even if an act was authorized by statute, a defendant could still be found negligent for the way that act was done.

Answer 353

Answer: 2 Explanation: Option (2) is correct because while a person can assign away benefits under a contract to a third party, a person generally cannot assign liabilities. Option (1) is incorrect because under the doctrine of privity of contract, only the parties to a contract can sue or be sued for its breach. Option (3) is incorrect because one exception to the doctrine of privity of contract is contracts which create an interest in land. Option (4) is incorrect because the Law and Equity Act states that a statutory assignment must be in writing, must be absolute and unconditional, and notice must be given in writing to the original promissor.

Answer 354

Answer: 1 Explanation: Option (1) is correct because a judgment against the strata corporation is a judgment against all the owners, and every strata lot owner is liable to pay the judgment in the portions set out in the Schedule of Unit Entitlement. Option (2) is incorrect because although the Strata Property Act requires the strata corporation to maintain insurance against liability for bodily injury, if this insurance does not cover the full judgment, George would still be liable to pay his proportionate liability. Option (3) is incorrect because the contingency reserve fund is used for paying for common expenses, not for paying damage awards. Option (4) is incorrect because since George is an owner, he must pay his proportionate liability.

Answer 355

Answer: 2 Explanation: Option (2) is correct because it is a valid defence to private nuisance if the damage caused is trifling and of little consequence. Option (1) is incorrect because it is no defence to say that the utmost care and skill have been taken. Option (3) is incorrect because having authority under a municipal business licence is not a defence to private nuisance. Option (4) is incorrect because it is no defence to say that a person is only making a reasonable use of his or her property.

Answer 356

Answer: 3 Explanation: Option (3) is correct because although Avon is not liable for voluntary, permissive, or ameliorating waste, Avon would still incur liability for flagrantly or maliciously damaging or destroying the property. Option (1) is incorrect because Avon is not liable for permissive waste. Option (2) is incorrect because Avon is not liable for ameliorating waste. Option (4) is incorrect because Avon is liable for equitable waste.

Answer 357

Answer: 1 Explanation: To calculate the straight-line depreciation, take the amount that can be depreciated and then divide by the number of years.

Answer 358

Answer: 2 Explanation: Option (2) is correct. The easement must be capable of forming the subject matter of a grant, which means that the easement must be capable of reasonably exact definition. One must be able to identify its boundaries. Furthermore, the person granting the easement and the person whose land receives the benefit of the easement must have the necessary capacity to be grantor and grantee. For example, a tenant cannot grant an easement that binds the property after the tenancy expires. Option (1) is incorrect because an easement can be either positive or negative in nature (in comparison to a restrictive covenant, which must be negative in nature). Option (3) is incorrect because one party can own both the dominant and servient tenement provided that they are two different parcels of land. Option (4) is incorrect because the easement must accommodate the dominant tenement, not the servient tenement.

Answer 359

Answer: 3 Explanation: Option (3) is correct because an order absolute of foreclosure does not wipe all other charges, liens, encumbrances, and interests off the title. Option (1) is incorrect because once the petitioner has been granted the order absolute of foreclosure, he or she may not then sue the borrower on the borrower’s personal covenant. Option (2) is incorrect because the order absolute of foreclosure declares that the respondents are foreclosed of any right, title, or interest in the mortgaged property and it directs them to deliver up possession of the property to the petitioner. Option (4) is incorrect because if the petitioner sells the land, there is no requirement to account to the borrower for any money received or any profit which might be realized in excess of the mortgaged debt.

Answer 360

Answer: 2 Explanation: Option (2) is correct because a portable mortgage allows the borrower to sell his or her home and carry the mortgage over to the purchase of a new home. Because of this portability, the borrower will save money if his or her mortgage has a lower interest rate than the current interest rate that a new mortgage would be written at. Option (1) is incorrect because a portable mortgage allows a seller of their home to carry the mortgage over to a purchase of a new home. Option (3) is incorrect because a portable mortgage cannot also be vendor-supplied. Option (4) is incorrect because a portable funds fee is not necessarily always charged on a portable mortgage.

Answer 361

Answer: 3 Explanation: Option (3) is correct because the Personal Information Protection Act (PIPA), which came into force in January 2004, regulates the way private sector organizations collect, use, keep secure, and disclose personal information. Options (1), (2), and (4) are incorrect because they do not refer to legislation that regulates personal information.

Answer 362

Answer: 4 Explanation: Option (4) is correct because a licensee may be exempt from the application of the Real Estate Services Act (RESA) and the Real Estate Services Rules when the licensee manages rental real estate owned by himself or herself. To be exempt, the licensee must provide these services in their own name and not in the name of their related brokerage, must not include any information about their brokerage in advertising the rental real estate, and must disclose in writing to their managing broker that they will be providing rental property management services on their own behalf in relation to their own real estate. The licensee must also disclose to each potential tenant of the rental real estate that even though they are licensed under RESA, they are not acting as a licensee in this case and are not regulated under RESA in relation to the rental real estate. Options (1), (2), and (3) are incorrect for this reason.

Answer 363

Answer: 1 Explanation: Option (1) is correct because buyers of cooperatives own shares in the cooperative association or company and is a tenant, rather than a fee simple owner. Option (2) is incorrect because the disclosure requirements in the Real Estate Development Marketing Act apply to cooperatives and condominiums. Option (3) is incorrect because condominiums are generally easier to sell than cooperatives because the cooperative association’s board of directors must approve the person who proposes to buy a cooperative owner’s shares. Option (4) is incorrect because where a building is being converted to a cooperative, any residential tenants who are required to move will be entitled to the protections of the Residential Tenancy Act.

Answer 364

Answer: 1 Explanation: Option (1) is correct because a brokerage does not have to have a separate trust account for each client. Option (2) is incorrect because all money received for or on behalf of a client must be put into a trust account as soon as the brokerage receives it. Option (3) is incorrect because a brokerage is permitted to withdraw money paid into a trust account if it was paid into the trust account by mistake. Option (4) is incorrect because money paid into a trust account may be withdrawn to cover expenses incurred on behalf of a client and according to the client’s instructions.

Answer 365

Answer: 3 Explanation: Press Display 6  NOM% 6 1  P/YR 1  EFF% 6 365  P/YR 365  NOM% 5.827356 30 N 30 370000 +/ PV 370,000 0 PMT 0 FV 371,776.263438 At a rate of j1 = 6%, $371,776.26 is the minimum amount that Fancy Finance should receive.

Answer 366

Answer: 2 Explanation: Option (2) is correct (i.e., false) because a brokerage’s real estate commission appears on the seller’s statement of adjustments as a debit, and does not appear on the buyer’s statement of adjustments. Option (1) is incorrect because where an existing mortgage will be assumed by the buyer and remain on title, the amount of cash due to the seller is reduced which is reflected as a debit on a seller’s statement of adjustments. Option (3) is incorrect because the seller is responsible for property taxes up to the day before the adjustment date, and the buyer is responsible for the property taxes on the adjustment date. Option (4) is incorrect because a seller’s portion of taxes to be paid in the future will reduce the amount required to complete due from the buyer which is reflected as a credit on a buyer’s statement of adjustments.

Answer 367

Answer: 4 Explanation: Option (4) is correct because only the principal or agent can terminate the authority. Options (1), (2), and (3) are incorrect because these are ways that can terminate an agency contract.

Answer 368

Answer: 4 Explanation: Option (4) is correct because all of the statements are true. Option (1) is true because a special buyer is a potential purchaser that is interested in a particular property because it has a specific attribute, and he or she may be willing to pay significantly more or less than other buyers. Option (2) is true because real property is immobile, which causes the market for real property to be local by nature. Option (3) is true because the neighbourhood an appraiser considers in his or her analysis may not be confined to the subdivision. This will depend on the abundance of similar recent sales and the appraiser’s discretion.

Answer 369

Answer: 3 Explanation: Option (3) is correct because unlimited liability means that the owner’s legal liability is not limited to his or her initial investment in the company. Sole proprietors and general partners have unlimited liability, whereas limited partners and corporate shareholders have limited liability. Options (1), (2), and (4) are incorrect statements.

Answer 370

Answer: 4 Explanation: Option (4) is correct and Options (1), (2), and (3) are incorrect because all of the statements are true. A commercial lease for a fixed term terminates automatically upon expiration of the term specified in the lease. Commercial leases can be set for any length of time. Commercial leases must include the commencement date and duration of its term.

Answer 371

Answer: 2 Explanation: To calculate the maximum loan amount, calculate the loan amounts based on both the constraint of the loan-to-value ratio and the gross debt service ratio. The loan-to-value is calculated based on the bank’s appraisal of the property. In this case, the amount the bank appraises the property at is $375,000. Once the payments from the GDSR are calculated, the PV of the loan is calculated, taking into consideration the stress test qualification rules. The loan amount that satisfies both constraints (the smaller amount) will be the maximum loan amount. LTV = 80% Lending Value = $375,000 Maximum loan under lender’s LTV criteria = 0.8 × $375,000 = $300,000 GDSR = 32% P + I = (GDSR × Gross Income) – Property Taxes P + I = (0.32 × $60,000) – $1,800 P + I = $17,400 per year = $1,450 per month The mortgage qualifying rate is based on the greater of (1) the government-specified qualifying rate of j2 = 5.25% OR (2) an additional 2% above the mortgage’s negotiated contract rate. In this case, you would apply a rate of j2 = 5.25%, the government-specified rate, which is greater than the mortgage’s contract rate plus 2% of j2 = 5% (2% + 3%). Press Display 5.25  NOM% 5.25 2  P/YR 2  EFF% 5.318906 12  P/YR 12  NOM% 5.193482 1450 +/– PMT –1,450 300 N 300 0 FV 0 PV 243,322.060330 The maximum loan under the GDSR is $243,320, rounded to the nearest $10. The maximum that Jake can borrow is the lesser of $300,000 (LTV) and $243,320 (GDSR). In this case, Jake can only borrow $243,320, rounded to the nearest $10.

Answer 372

Answer: 2 Explanation: Option (2) is correct because the doctrine of the void deed was a component of the common law system, but is not a component of the British Columbia land title registration system. Options (1), (3), and (4) are incorrect because they are all components of the British Columbia land title registration system.

Answer 373

Answer: 4 Explanation: Option (4) is correct and Options (1), (2), and (3) are incorrect because the plaintiff must first file and serve a notice of civil claim, then the defendant must file and serve a response to civil claim, then an examination for discovery is conducted, and finally the judgment is enforced.

Answer 374

Answer: 3 Explanation: Option (3) is correct because it is false. Option (1) is incorrect because lenders and brokers must disclose the Annual Percentage Rate (APR) to the borrower. Option (2) is incorrect because the APR represents the borrower’s contractual interest rate plus any non-interest finance charges. Option (4) is incorrect because in order to provide borrowers with some help in determining the actual cost of borrowing, most provincial governments in Canada have legislated that certain disclosure requirements must be met for specific types of mortgages. However, a disclosure statement must be given to a borrower TWO days prior to the borrower incurring an obligation under a credit agreement, unless the time period is waived by the borrower in accordance with Section 15 of the Disclosure of the Cost of Consumer Credit Regulation.

Answer 375

Answer: 3 Explanation: Option (3) is correct because the Real Estate Development Marketing Act, not the Real Estate Services Act, requires disclosure statements. Options (1), (2), and (4) are incorrect because these are ways in which the Real Estate Services Act achieves its primary purpose.

Answer 376

Answer: 3 Explanation: Option (3) is correct because the legal fees for discharge of the second mortgage, sales commission and assumption of first mortgage all appear on the vendor’s statement of adjustments as debits. Options (1) and (4) are incorrect because the purchaser’s share of taxes paid appears as a credit on the vendor’s statement of adjustments. Option (2) is incorrect because sale price appears as a credit on the vendor’s statement of adjustments.

Answer 377

Answer: 1 Explanation: Option (1) is correct because a proprietor’s net income on the income statement will increase the owner’s equity account on the balance sheet. Option (2) is incorrect because net assets is found only on the balance sheet, and does not link to the income statement. Option (3) is incorrect because depreciation expense is found only on the income statement, and does not link to the balance sheet. Option (4) is incorrect, because retained earnings is a link between the income statement and the balance sheet for a corporation only, not a proprietorship.

Answer 378

Answer: 3 Explanation: Option (3) is correct because having an existing contractual relationship between the parties is not a requirement for a successful claim of negligent misrepresentation. Options (1), (2), and (4) are incorrect because these are all requirements of negligent misrepresentation.

Answer 379

Answer: 1 Explanation: NOIDCR =PMT NOI $637,500PMT = = = $425,000(annual payment)DCR 1.5This loan calls for quarterly payments: $425,000 ÷ 4 = $106,250 Press Display 14  NOM% 14 1  P/YR 1  EFF% 14 4  P/YR 4  NOM% 13.319794 637500 ÷ 1.5 ÷ 4 = 106,250 +/ PMT 106,250 30 × 4 = N 120 0 FV 0 PV 3,128,115.32741 The amount borrowed is $3,128,000, rounded to the nearest $1,000.

Answer 380

Answer: 1 Explanation: To calculate the straight-line depreciation, take the amount that can be depreciated and then divide by the number of years.

Answer 381

Answer: 3 Explanation: Option (3) is correct and Option (4) is incorrect because statute law always prevails over equitable principles. Option (1) is incorrect because equitable principles prevail over common law principles. Option (2) is incorrect because statute law prevails over common law principles.

Answer 382

Answer: 2 Explanation: Option (2) is correct because damproofing is the material applied to foundation walls to seal the pores and prevent water from penetrating the concrete with capillary action movement. Options (1), (3), and (4) are false.

Answer 383

Answer: 3 Explanation: Option (3) is correct because the courts will consider whether the representation would have a real effect upon an ordinary consumer’s buying decision. There is no need to prove that an individual consumer or group of consumers was actually misled. Option (1) is incorrect because the general impression test is considered where the oral or written statements in the representation are literally true but the visual portion may create a false impression. Option (2) is incorrect because the representation must be false or misleading in a material respect to constitute an offence under section 52. Option (4) is incorrect because the accused may escape liability under section 52 if they honestly believed that the representations or advertisements were not false or misleading and that they exercised due diligence in making sure that was the case.

Answer 384

Answer: 1 Explanation: Option (1) is correct because FINTRAC is required under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to make public all AMPs imposed. Option (2) is incorrect because the issuance of an AMP is not automatic, and is generally used after other methods for promoting compliance have failed. Option (3) is incorrect because FINTRAC has discretion to disclose relevant information to law enforcement, depending on the extent of the non-compliance. Option (4) is incorrect because the maximum penalty which can be imposed on an individual under an AMP is $100,000.

Answer 385

Answer: 1 Explanation: Johnny needs to save $19,800; this amount will be the future value. Press Display 9 I/YR 9 12  P/YR 12 0 PMT 0 10 N 10 19800 +/ FV 19,800 PV 18,374.462433

Answer 386

Answer: 4 Explanation: Option (4) is correct because the most obvious difficulty in using the cost approach to value properties is that cost and market value may not be approximately equal. The cost approach is most applicable to problems where data is lacking for the income or comparison approaches. Options (1), (2), and (3) are incorrect.

Answer 387

Answer: 2 Explanation: Option (2) is correct because the Real Estate Services Act does not require all listings to always be in writing. Option (1) is incorrect because commission is only paid to the agent who is the effective cause of the sale under an open listing. Option (3) is incorrect because if the seller disposes of the property to a prospect not introduced by any of the listing agents, the seller does not pay anyone a commission. Option (4) is incorrect because under an open listing, the seller is free to employ a number of brokerages to also represent the seller through their Designated Agents.

Answer 388

Answer: 4 Explanation: Option (4) is correct because the revenue recognition principle states that revenue should be recorded when it is earned, not when payment is received. In the case of a sale of property, Sandy Salesperson has earned her commission as soon as the subject clauses are removed. Options (1), (2), and (3) are incorrect as these principles do not deal with the timing of recognizing revenue.

Answer 389

Answer: 2 Explanation: The market value of Sara’s offer is the market value of the mortgage plus her cash down payment. Sara will assume the remaining 233 monthly payments of $1,050. Calculate the market value of the mortgage by determining the PV of the remaining payments based on the current market rate of j2 = 5.5%. Press Display 5.5  NOM% 5.5 2  P/YR 2  EFF% 5.575625 12  P/YR 12  NOM% 5.438018 1050 +/- PMT 1,050 233 N 233 0 FV 0 PV 150,903.77664 (market value of the mortgage) + 50000 = 200,903.77664 (market value of the offer) The market value of Sara’s offer is $200,903.78.

Answer 390

Answer: 3 Explanation: Option (3) is correct because the Residential Tenancy Act does not permit a landlord to end a residential tenancy agreement for cause so that the renovations can be performed. Options (1), (2), and (4) are incorrect because section 47(1) of the Residential Tenancy Act provides that these are examples of a situation in which a landlord can end a residential tenancy agreement for cause.

Answer 391

Answer: 4 Explanation: Option (4) is correct and Options (1), (2), and (3) are incorrect because a strata lot’s contribution to an expense is calculated as the unit entitlement of the strata lot divided by the total unit entitlement of all strata lots multiplied by the total contribution. Richard’s unit entitlement is 2,400, the total unit entitlement of all strata lots is 40,000, and the total contribution is $48,000. Richard’s annual share of the common expense is $2,880, and therefore his monthly share is $240.

Answer 392

Answer: 3 Explanation: Option (3) is correct because the type of buyer does not generally factor into the consideration of whether or not the profit realized on the sale of property was business income (i.e. money earned from an activity carried on for the purpose of making a profit). On the other hand, the seller’s actions and intentions are considered in the decision. Options (1), (2), and (4) are incorrect because they are all factors which are generally considered in deciding when profit is considered business income rather than a capital gain.

Answer 393

Answer: 4 Explanation: Option (4) is correct because it is the only option listed that is not a valid reason to hire a professional appraiser. Real property typically has relatively long physical and economic lifespans, and it is not very easy to account for changes over these long time frames. Options (1), (2), and (3) are incorrect because they are all reasons to hire a professional appraiser.

Answer 394

Answer: 2 Explanation: Option (2) is correct because the Strata Property Act does not require a minimum of $5,000,000 liability insurance on the strata project. Option (1) is incorrect because the Strata Property Act imposes an obligation on the strata corporation to repair and maintain the common property and common assets. Option (3) is incorrect because the Strata Property At requires a contingency reserve fund to be established for unusual or extraordinary expenses. Option (4) is incorrect because the Strata Property Act requires the strata corporation to maintain an operating fund for common expenses.

Answer 395

Answer: 4 Explanation: Option (4) is correct because registering a notice of civil claim against the judgment debtor’s property is not a means available to judgment creditors to enforce a judgment. Option (1) is incorrect because the plaintiff can examine the judgment debtor in court under oath about his or her assets and sources of income. Option (2) is incorrect because the plaintiff can request a writ of execution to be issued by the court to the sheriff directing the seizure and sale of enough of the debtor’s assets to pay the judgment plus the costs of seizure. Option (3) is incorrect because a garnishing order can be served on the judgment debtor’s bank, requiring the bank to pay the money into the court instead of to the debtor.

Answer 396

Answer: 2 Explanation: Option (2) is correct (false) because the insurance company guarantees that the lender can recover all of the funds loaned in case of default, but does not guarantee that borrowers will be able to make their mortgage payments without interruption. Option (1) is incorrect; lenders may apply a higher loan-to-value ratio to an insured loan because the insurance reduces risk to the lender. Option (3) is incorrect because the insurance premiums are typically added to the loan amount. Option (4) is incorrect, as it is the lender that benefits from the insurance. The borrower may also derive some indirect benefit such as a lower interest rate or higher loan amount.

Answer 397

Answer: 2 Explanation: Option (2) is correct because the comparative approach is generally used for residential properties with sufficient comparable sales data available. Options (1) and (3) appear too unique for the comparative approach, and Option (4) appears to be an income-generating investment building, thus the income approach should be used.

Answer 398

Answer: 3 Explanation: Option (3) is correct (false) because Canada has a smaller market share of subprime mortgages than the US. Options (1), (2), and (4) are incorrect because they are true.

Answer 399

Answer: 1 Explanation: Option (1) is correct because an agent is not personally liable if they are mistakenly believed by a third party to be contracting as a principal. Options (2), (3), and (4) are incorrect because these are the three situations at common law in which an agent is personally liable to a third party.

Answer 400

Answer: 1 Explanation: Option (1) is correct because a deposit is not required to create a binding contract of purchase and sale. Option (2) is incorrect because where an offer is received with a deposit after banking hours and the seller rejects the offer before the bank reopens, the cheque may be returned intact to the purchaser. Option (3) is incorrect because agents hold deposits as stakeholders. Option (4) is incorrect because section 27 of the Real Estate Services Act requires that all money held or received from, for, or on behalf of a principal in relation to real estate services, must be promptly paid or delivered by a licensee to his or her brokerage.

Answer 401

Answer: 3 Explanation: Option (3) is correct because once a building scheme has been established, the restrictions imposed may be modified or discharged only by an express agreement between all of the present owners of the lots. Options (1), (2), and (4) are incorrect because these are all requirements that must be met in order for the arrangement to constitute a valid building scheme.

Answer 402

Answer: 2 Explanation: Option (2) is correct because when payments are rounded up to the next higher dollar for a fully amortized loan, the result will be a smaller final payment, and possibly a reduction in the number of payments. This is because the borrower is “overpaying” a slight amount each period. The cumulative effect will depend on the loan amount, amortization period, and the amount that the payment was rounded up. Options (1), (3), and (4) are incorrect for this reason.

Answer 403

Answer: 4 Explanation: Option (4) is correct because leases dealing with residential property for a period of over 20 years are not “residential tenancies” and must be dealt with as commercial tenancies. Commercial tenancies are not subject to the provisions of the Residential Tenancy Act. Options (1), (2), and (3) are incorrect because they are all situations that are subject to the provision of the Residential Tenancy Act.

Answer 404

Answer: 3 Explanation: Option (3) is correct because central gas fired forced hot air heating systems are advantageous because they have a rapid response to extreme outside temperature changes. Options (1), (2), and (4) are incorrect because these heating systems do not provide as fast of a response.

Answer 405

Answer: 4 Explanation: The borrower’s maximum monthly payments are to be 30% of his $2,500 monthly income; in other words, the borrower’s maximum monthly payment will be $750 ($2,500 × 0.3). Then, calculate the maximum amount lent, which is the PV of the monthly payments. Press Display 9  NOM% 9 2  P/YR 2  EFF% 9.2025 12  P/YR 12  NOM% 8.835748 0 FV 0 200 N 200 750 +/ PMT 750 PV 78,374.008924

Answer 406

Answer: 4 Explanation: Option (4) is correct because the listing contract must be signed by all of the owners. Option (1) is incorrect because a listing agreement is a contract between a seller and a brokerage and does not involve a buyer. Option (2) is incorrect because in order for a licensee to be entitled to commission, the licensee must produce a purchaser whose offer strictly complies with the terms of the listing agreement. Option (3) is incorrect because a listing brokerage can still be entitled to commission even if it does not have a listing agreement with the seller prior to listing the property for sale.

Answer 407

Answer: 1 Explanation: Option (1) is correct because depreciation is an accounting concept, and does not relate to contract law. Options (2), (3), and (4) are incorrect because these are all topics relating to contract law.

Answer 408

Answer: 1 Explanation: Option (1) is correct (false) because the general impression test is used in this situation, which can still result in a conviction under section 52. Option (2) is incorrect (true) because a misrepresentation will only be contrary to section 52 of the Competition Act if it is false or misleading in a material respect. Option (3) is incorrect (true) because section 52 applies to both oral and written misrepresentations. Option (4) is incorrect (true) because the accused may escape liability under section 52 if they honestly believed that the representations or advertisements were not false or misleading and that they exercised due diligence in making sure that was the case.

Answer 409

Answer: 2 Explanation: Option (2) is correct because the agent has a duty to tell his or her client everything relevant to the transaction within the agent’s knowledge. Failing to mention that the buyer may be willing to increase the offer is a breach of the agent’s legal and ethical duty of full disclosure. Option (1) is incorrect because the agent does not have an ethical obligation to deal fairly with the buyer at all times. Option (3) is incorrect because this was a breach of the agent’s duty of full disclosure, and therefore is not acceptable conduct. Option (4) is incorrect because this is not an example of the agent’s duty not to make a secret profit.

Answer 410

Answer: 2 Explanation: Option (2) is correct because the Builders Lien Act gives priority to the lien over a mortgage as of the date the lien is filed in the Land Title Office. Where part of the money has been advanced and then a builder’s lien is filed against the property, the builder’s lien has priority over further advances made under the mortgage. Option (1) is incorrect because the advances clause states that all payments are at the discretion of ABC, so it would not be a breach of the mortgage contract to refuse to pay the second installment. Option (3) is incorrect because the lien takes priority over all subsequent advancements of funds because of the operation of the Builders Lien Act. Option (4) is incorrect because allowing a builder’s lien to remain on title does not constitute a breach of the mortgage contract.

Answer 411

Answer: 1 Explanation: Press Display 1  P/YR 1 375000 +/ PV 375,000 0 PMT 0 3 N 3 483400 FV 483,400 I/YR 8.832463 The investor will earn an effective annual rate of 8.832463%.

Answer 412

Answer: 4 Explanation: Option (4) is correct because damages are a common law remedy. Options (1), (2), and (3) are incorrect because specific performance, injunctions, and quantum meruit are equitable remedies.

Answer 413

Answer: 4 Explanation: Option (4) is correct because the residual method is used for properties that have latent value. Options (1), (2), and (3) are incorrect because it is not clear whether there is latent value in each situation.

Answer 414

Answer: 3 Explanation: Press Display 11.5  NOM% 11.5 12  P/YR 12  EFF% 12.125933 2  P/YR 2  NOM% 11.779067

Answer 415

Answer: 2 Explanation: Option (2) is correct because the indefeasibility principle means that any registered owner who acquires a fee simple estate in good faith and for valuable consideration is protected by the land title system. That purchaser can keep his or her title, even if the previous registered owner acquired title by way of fraud or forgery. Option (1) is incorrect because the indefeasibility principle allows the purchaser to keep his or her title. Option (3) is incorrect because Michael did not contribute to his own loss by neglecting to register a lien on his title to indicate that he was the registered owner. Option (4) is incorrect because the principle of indefeasibility overrules the common law doctrine of void deed, and so the transfer of the property to the third party was valid and the purchaser now has indefeasibility of title.

Answer 416

Answer: 2 Explanation: Option (2) is correct because the registration and approval of a strata plan creates an estate in fee simple for each individual strata lot. Option (1) is incorrect because the approval required to amend the bylaws of the corporation varies based on the strata type, and whether it is before or after the second annual general meeting. Option (3) is incorrect because the condominium concept can be utilized for both residential and non-residential projects. Option (4) is incorrect because all strata lots do not need to be presold before a strata plan can be registered in the land title office.

Answer 417

Answer: 2 Explanation: Press Display 12  P/YR 12 200000 PV 200,000 1400 +/ PMT 1,400 219820.63 +/ FV 219,820.63 12 N 12 I/YR 17.5387  EFF% 19.019559

Answer 418

Answer: 1 Explanation: Option (1) is incorrect because a mortgage is not a loan, but instead is security for a loan. Options (2), (3), and (4) are incorrect because these are all true statements concerning mortgages.

Answer 419

Answer: 4 Explanation: Option (4) is correct because all real estate representatives are employed by a managing broker, and trade in real estate in the brokerage’s name and on behalf of the brokerage’s clients. Option (1) is incorrect because a licensee can only provide real estate services under the supervision of a managing broker. Option (2) is incorrect because licensees may employ unlicensed assistants, but must ensure that an unlicensed assistant is not performing any tasks that fall within the definition of “trading services”. Option (3) is incorrect because all representatives must be employed by a registered real estate brokerage.

Answer 420

Answer: 4 Explanation: Option (4) is the correct answer because under designated agency, while the contracting party is still the brokerage, the seller agrees that the brokerage will appoint one or more specific licensees to act as the seller’s sole agent. Options (1) and (2) are incorrect because dual agency, not designated agency, relates to whether a licensee can or cannot act for both the buyer and seller. Option (3) is incorrect because a listing agreement involves the seller but not the buyer.

Answer 421

Answer: 2 Explanation: Option (2) is correct because the sand blowing onto Ana’s property, making the tennis court slippery and hazardous for anyone playing there, is likely to be considered an unreasonable and substantial interference with the reasonable use and enjoyment of her property, and would therefore be considered a private nuisance. Option (1) is incorrect because trespass requires an intentional act, and the sand was carried onto Ana’s property by the wind, rather than by an intentional act done by Fletcher. Option (3) is incorrect because Fletcher could still be liable for private nuisance even though the problem occurred because of the wind. Option (4) is incorrect because the tort of private nuisance does not require the conduct to be done intentionally.

Answer 422

Answer: 1 Explanation: In this question the given rate is compounded semi-annually; N must be set equal to 2, as there are 2 semi-annual periods in 12 months. Press Display 11.25 I/YR 11.25 2  P/YR 2 2 N 2 275000 PV 275,000 0 PMT 0 FV 306,807.617187

Answer 423

Answer: 1 Explanation: Since we know that the comparable property has one less bedroom, its sale price calls for an adjustment. We know that the market value of one bedroom is $1,100, so the sale price of the subject property is adjusted up by $1,100. We also know that the comparable property has a garage, while the subject does not. Since the market value of a garage is stated to be $7,000, we must adjust the sale price of the comparable down by $7,000. Finally, it is stated that each 100 sq. ft. above the 2,000 sq. ft. benchmark has a market value of $3,000. Since the comparable is 200 sq. ft. smaller than the subject, we must adjust the sale price of the comparable up by 200 sq. ft. × $3,000 = $6,000. The adjusted sale price is $173,000 +$1,100  $7,000 + $6,000 = $173,100

Answer 424

Answer: 1 Explanation: Option (1) is correct because the owner would have to live in the property as a principal residence for 6 months in order to avoid the Empty Homes Tax; 3 months is not sufficient. In addition, investors who use their property as a short term rental without a hotel or B&B license are subject to the EHT where the rental periods are shorter than 30 days. Option (2) is incorrect because properties which are rented for at least 30 days in a row for a minimum of six months in aggregate over the course of a year are exempt from the EHT. Options (3) and (4) are incorrect because the EHT does not apply to properties being used as a principal residence by the owner, a family member, or a friend for at least six months of the year.

Answer 425

Answer: 1 Explanation: Option (1) is correct. Since there is a -$4,000 adjustment for bedrooms, this comparable has one more bedroom than the subject (5 bedrooms). In addition, since there is a +$5,700 adjustment for bathrooms, the comparable has one less bathroom than the subject (3 bathrooms). Options (2), (3), and (4) are therefore incorrect.

Answer 426

Answer: 1 Explanation: Option (1) is correct because sophisticated investors will ultimately determine the value of undeveloped land by estimating the value of the land when improved and subtracting the costs of undertaking such a development. Options (2), (3), and (4) are incorrect because they do not determine the value of undeveloped land.

Answer 427

Answer: 3 Explanation: Option (3) is correct because in relation to the subject property, this comparable requires an adjustment of +$6,000 for 1 bathroom and +$4,000 for an alarm system. Options (1), (2), and (4) are therefore incorrect.

Answer 428

Answer: 3 Explanation: Option (3) is correct and Options (1), (2), and (4) are incorrect because a limitation or restriction placed upon the use of one person’s land for the benefit of another is called a restrictive covenant.

Answer 429

Answer: 4 Explanation: Option (4) is correct because in a mortgage transaction, the mortgagee is granted the mortgage from the mortgagor as security for a loan. Options (1), (2), and (3) are incorrect because these options describe the mortgagor, not the mortgagee.

Answer 430

Answer: 1 Explanation: Option (1) is correct because since the comparable does not have an alarm system and the subject property does, there is a +$4,500 adjustment for the alarm system. In addition, since the subject property has 100 square feet less than the comparable, an adjustment for - $6,000 is required. Therefore, Options (2), (3), and (4) are incorrect.

Answer 431

Answer: 1 Explanation: Ernie assumes responsibility for the remaining 36 monthly payments of $3,994 and the outstanding balance of $433,709.14. Calculate the market value of the mortgage by determining the PV of the remaining payments and OSB at the end of the original 5-year term based on the current market rate of j1 = 10%. The market value of the offer is the market value of the mortgage plus the cash down payment. Press Display 10  NOM% 10 1  P/YR 1  EFF% 10 12  P/YR 12  NOM% 9.568969 36 N 36 3994 +/ PMT 3,994 433709.14 +/ FV 433,709.14 PV 450,410.811187 (market value of the mortgage) + 240000 = 690,410.811187 (market value of the offer) The market value of the offer is $690,410.81.

Answer 432

Answer: 4 Explanation: Option (4) is correct because a landlord must provide written, not oral, notice at least three months in advance in order to increase rent. Option (1) is incorrect because a residential tenant can assign or sublet the leased premises at any time during the term of the tenancy with the consent of the landlord. Option (2) is incorrect because if a tenant has failed to give the security deposit required under the agreement within 30 days of the date it is required, the landlord is entitled to terminate the tenancy for cause by giving not less than one month written notice. Option (3) is incorrect because a landlord can enter residential premises if an emergency exists and the entry is necessary to protect life or property.

Answer 433

Answer: 2 Explanation: Option (2) is correct because licensees are not required to include the name of their related brokerage in each “Tweet”. Option (1) is incorrect because the name of the brokerage must appear in a prominent and easily readable form on all internet and social media advertising vehicles, including each individual page. Option (3) is incorrect because claims such as “Top Selling Real Estate Team!” must include a qualifying statement. Option (4) is incorrect because if a licensee posts a video blog on YouTube, the name of the brokerage must be in the title or description of the video.

Answer 434

Answer: 1 Explanation: Option (1) is correct because specific performance can be granted for a contract for the sale of property, but only if there is evidence that the subject property is unique. Options (2), (3), and (4) are incorrect because these are all true statements regarding specific performance.

Answer 435

Answer: 3 Explanation: The cap rate used to calculate the market value of the subject property is the one that most reflects the subject property and is determined by several factors. For the purposes of this question, the two most comparable properties have been selected and a range of values is determined. Find the cap rate:

Answer 436

Answer: 1 Explanation: Option (1) is correct and Options (2), (3), and (4) are incorrect because yields and market values are inversely related. If market capitalization rates (i.e., the required yields) decline while net operating income remains constant, market values will rise.

Answer 437

Answer: 3 Explanation: Option (3) is correct because the registration of a charge only raises a rebuttable presumption that the charge is valid. Unlike a registered fee simple, a registered charge is not “guaranteed”. Option (1) is incorrect because the registration of a mortgage transfers the mortgagor’s interest in land to the mortgagee as security for the repayment of the debt. Option (2) is incorrect because even if a mortgage is not registered in the land title office, it is still enforceable as between the parties to the mortgage. Option (4) is incorrect because Option (3) is correct.

Answer 438

Answer: 1 Explanation: Option (1) is correct because a conflict of interest arises when there is a substantial risk that the agent’s representation of a client would be negatively affected by the agent’s own interest or by the agent’s duties to another. Option (2) is incorrect because some conflicts of interest can be avoided. Option (3) is incorrect because conflicts of interest can be documented or undocumented. Option (4) is incorrect because a trivial risk to a client does not create a conflict of interest by itself – the risk can be something that is more than trivial.

Answer 439

Answer: 2 Explanation: Option (2) is correct because movable objects such as furniture are not normally included in the concept of real property, but instead are considered personal property. Options (1), (3), and (4) are incorrect because these are normally classified as real property.

Answer 440

Answer: 1 Explanation: Option (1) is correct because strata corporations are created so that property can be subdivided into separate parts for private ownership. The sole purpose is not to limit the liability of the corporation members. Options (2), (3), and (4) are incorrect because these are true statements relating to strata lot ownership.

Answer 441

Answer: 1 Explanation: Option (1) is correct (false) because there is no single statute law governing the real property tax system in BC. The Assessment Act is one of the sources of property law, but not the only source. Option (2) is incorrect (true) since Helen, as the registered owner, is no longer living in the Vancouver property, she is not eligible for the basic home owner grant. Option (3) is incorrect (true); if a property has been incorrectly assessed, anyone, including a municipal council, can file an appeal to the Property Assessment Review Panels under the Assessment Act. Option (4) is incorrect (true); Helen is qualified for a special assessment on her property because she has lived continuously in that home for more than 10 years, and the property was zoned for a higher use.

Answer 442

Answer: 2 Explanation: Press Display 4.2 I/YR 4.2 12  P/YR 12 288000 PV 288,000 1780 +/ PMT 1,780 0 FV 0 N 239.098618 40 INPUT  AMORT PER 40-40 = = = 254,915.902065 The outstanding balance after the 40th payment is made is $254,915.90.

Answer 443

Answer: 4 Explanation: Option (4) is correct because none of the other statements are true. Option (1) is incorrect because the interests of the agent do not take priority over those of the principal. Option (2) is incorrect because the agent’s primary duty is to their principal, who may or may not be the buyer of the property. Option (3) is incorrect because the agent is not an employee of their principal.

Answer 444

Answer: 4 Explanation: Option (4) is correct because it is true. Option (1) is incorrect because changing any physical characteristic of a property such that it results in a misrepresentation is not acceptable. Option (2) is incorrect because photo editing is allowed as long as it does not misrepresent aspects of the property. Option (3) is incorrect because removing power lines with photo editing is considered changing a physical characteristic of the property and represents a misrepresentation, which is unacceptable.

Answer 445

Answer: 4 Explanation: Option (4) is correct because section 10 of the Interest Act does not require that the lender be a financial institution in order for the borrower to have the right to tender prepayment of their mortgage. Options (1), (2), and (3) are incorrect because these are all requirements under section 10 of the Interest Act in order for a borrower to tender prepayment.

Answer 446

Answer: 2 Explanation: Final Cost − Salvage Value = Remaining Value $17,100 − $1,500 = $15,600 $15,600 ÷ 10 = $1,560 per year depreciation

Answer 447

Answer: 3 Explanation: Option (3) is correct because section 46 of the Residential Tenancy Act provides that a landlord can give a notice of the end of the tenancy agreement to a tenant who does not pay the rent when it is due, which is cancelled if the tenant pays the rent owing within 5 days of receiving the notice. Option (1) is incorrect because section 26 of the Residential Tenancy Act abolishes the remedy of distress (seizing a tenant’s goods and eventually selling them to satisfy a claim for rent owing) in residential tenancies. Option (2) is incorrect because non-payment of rent allows a landlord to terminate a fixed term tenancy agreement. Option (4) is incorrect because failure to pay rent does not make the tenancy agreement void.

Answer 448

Answer: 3 Explanation: Option (3) is correct because an implied easement may result if the intention of the parties granting the easement has not been sufficiently explicit. Option (1) is incorrect because the land receiving the benefit is called the dominant tenement. Option (2) is incorrect because the dominant tenement owner does not receive an ownership of the easement area, but rather has an interest in the land less than ownership. Option (4) is incorrect because an easement can only be granted by the owner of the servient tenement, not by a tenant who occupies the land under a lease.

Answer 449

Answer: 3 Explanation: Option (3) is the correct answer. A & A Appraisers will be responsible to Peach Credit Union under contract law, and will be responsible to Joan under tort law. The appraisal contract is between A & A and Peachy Credit Union, and an implied term in the contract is the appraisal report be carefully prepared according to accepted appraisal practices. Due to the unacceptable error, it is clear that this contract has been breached by A & A. There is no contract between A & A and Joan, but it is reasonable that Joan may rely on this appraisal report. Given the unacceptable error, A & A may be liable to Joan for the tort of negligence. Options (1), (2), and (4) are therefore incorrect.

Answer 450

Answer: 2 Explanation: Option (2) is correct because there are no legal restrictions regarding security deposits, so this is an item left open for negotiation. Option (1) is incorrect because it is up for negotiation who is entitled to the interest which accrues on a security deposit. Option (3) is incorrect because the federal Interest Act does not restrict the interest rate on a security deposit. Option (4) is incorrect because there are no legal restrictions regarding security deposits for commercial tenancies.

Answer 451

Answer: 4 Explanation: Option (4) is correct because licensees are not required to provide opinions to buyers on areas outside of their expertise. Option (1) is incorrect because a disclosure statement will not protect licensees from all misrepresentations. Option (2) is incorrect because a licensee can be liable for the tort of fraudulent misrepresentation even if he or she does not have expertise in that area. Option (3) is incorrect because vicarious liability does not arise between the licensee and the vendor.

Answer 452

Answer: 4 Explanation: Option (4) is correct because if a seller instructs a listing licensee not to disclose a material latent defect to a potential buyer of the property, the licensee must refuse to provide further trading services to or on behalf of that client in respect of the trade in real estate. Option (1) is incorrect because as an agent, the listing licensee owes a duty to follow his or her principal’s instructions. The listing licensee must therefore discontinue acting for the principal, rather than disregard the principal’s instructions. Option (2) is incorrect because the British Columbia Financial Services Authority governs licensees’ conduct; it does not govern consumers’ conduct. Option (3) is incorrect because the listing licensee cannot act upon instructions that would result in a misrepresentation of the property or in a violation of federal, provincial, or local law.

Answer 453

Answer: 4 Explanation: Press Display 12  P/YR 12 255000 PV 255,000 1582 +/ PMT 1,582 225208.61 +/ FV 225,208.61 36 N 36 I/YR 3.759815  EFF% 3.825288 The yield to the lender is below the loan’s interest rates (j12 = 4.5%), which is the expected result given the payments are sufficient to pay off a $250,000 loan, but the lender is actually advancing $255,000 (2%× $250,000 + $250,000). Therefore, the lender is being slightly underpaid with each payment. Given the inverse relationship between interest rates and present value, if the present value rises, then the interest rate drops.

Answer 454

Answer: 2 Explanation: Option (2) is correct and Options (1), (3), and (4) are incorrect because stare decisis literally means “let the former decision stand”, which requires courts to adhere to principles laid down by previous courts where the facts are substantially the same.

Answer 455

Answer: 1 Explanation: Option (1) is correct because although section 49 of the Real Estate Services Rules places limitations on when licensees can make promises to purchase property to induce a buyer to enter a contract, Tina complied with these limitations because she provided all the terms of the promise in writing to Tom before he entered into the contract of purchase and sale. Option (2) is incorrect because Tina did not breach the Real Estate Services Act. Option (3) is incorrect because Tina did not engage in misconduct and is not liable to be disciplined by the British Columbia Financial Services Authority. Option (4) is incorrect because neither Options (2) nor (3) are correct.

Answer 456

Answer: 4 Explanation: Option (4) is correct because registered charges are not indefeasible, but rather only raise a rebuttable presumption that the charge is valid. An innocent purchaser of any interest less than a fee simple estate in land may not rely on the land title system as being conclusive proof of ownership. Option (1) is incorrect because registered charges are not indefeasible. Option (2) is incorrect because Julia is able to have the mortgage removed from her title, and so is not obliged to repay the mortgage or recover from the assurance fund. Option (3) is incorrect because Handy Dandy is not entitled to recover the amount of the mortgage from the assurance fund because courts have found that the cost of fraud should not be borne by the public but should instead be the responsibility of the lenders themselves.

Answer 457

Answer: 2 Explanation: Option (2) is correct because real estate is affected by externalities due to the immobility of land. This immobility means that home owners cannot simply move their property away from negative externalities and cannot move their property towards positive externalities. Options (1), (3), and (4) are incorrect because they are not causes of neighbouring properties’ external influences on real property.

Answer 458

Answer: 4 Explanation: Property A: NOI = $312,800 – (0.05 × $312,800)– $88,200 = $208,960 Find the cap rate: NOICap RateSale Price= $208,960 ÷ $2,190,000 = 0.0954155 Subject Property’s NOI: $310,000 – (0.05 × $310,000)– $87,900 = $206,600 Sale Price = $206,600 ÷ 0.0954155 = $2,165,267, rounded to $2,165,000

Answer 459

Answer: 4 Explanation: Option (4) is correct because a license is not one of the three main classifications of interests in land that are less than estates. Options (1), (2), and (3) are incorrect because these are the three main classifications of interests in land that are less than estates.

Answer 460

Answer: 2 Explanation: For this question, assume this loan is fully amortized. Press Display 9  NOM% 9 2  P/YR 2  EFF% 9.2025 12  P/YR 12  NOM% 8.835748 219.39 +/ PMT 219.39 25500 PV 25,500 0 FV 0 36 INPUT  AMORT PER 36-36 = = = 24,201.556745 60 INPUT  AMORT PER 60-60 = = = 23,124.564546 The outstanding balance after 36 payments is $24,201.56 and the outstanding balance after 60 payments is $23,124.56.

Answer 461

Answer: 1 Explanation: Option (1) is false since a restrictive covenant must be a negative obligation; however, it does not matter whether the wording is positive or negative. Options (2), (3), and (4) are incorrect because they are true.

Answer 462

Answer: 4 Explanation: Option (4) is correct because Options (1), (2), and (3) are all required to be disclosed by licensees in this situation due to the operation of section 53 of the Real Estate Services Rules.

Answer 463

Answer: 3 Explanation: Option (3) is correct because the plaintiff does not have to prove an interference with the use and enjoyment of their land and physical damage to property to bring a successful claim for trespass. Options (1), (2), and (4) are incorrect because these are all true statements.

Answer 464

Answer: 1 Explanation: The maximum loan granted will be the lower amount of the loan-to-value constraint and the DCR constraint. Using DCR constraint, calculate maximum allowable payments.

Answer 465

Answer: 1 Explanation: Option (1) is correct because the plant was conforming to the bylaw prior to the rezoning, and so it will be “grandfathered” as a legal non-conforming use. Option (2) is incorrect because a non-conforming use may continue through successive changes of ownership. Option (3) is incorrect because the Local Government Act, not the Planning Act, establishes the circumstances under which non-conforming uses may continue. Option (4) is incorrect because land use contracts can no longer be created; rather, the use could continue as a legal non-conforming use or the property owner could apply to have the area rezoned.

Answer 466

Answer: 3 Explanation: Option (3) is correct because occupiers are entitled to assume that a visitor will exercise reasonable care for their own safety. Because Eugene breached this duty, he will probably not recover any damages against Rodney. Option (1) is incorrect because Rodney is likely not liable to Eugene for his injuries. Option (2) is incorrect because Lenore’s injury from tripping on the garden hose was a direct result of Rodney’s negligence, and she did not willingly assume these risks, so Rodney will likely be liable for her injuries. Option (4) is incorrect because Rodney is still an occupier of the premises even if he is not physically present when the injuries in question occurred.

Answer 467

Answer: 2 Explanation: Option (2) is correct because the Occupiers Liability Act requires an occupier of premises to take care that is reasonable in all of the circumstances to ensure that a person will be reasonably safe in using the premises. If Ethan was a child, it is likely that it would be found reasonable that he could not have read the sign, and so the occupier would have been required to do more to ensure he was reasonably safe. Option (1) is incorrect, because a visitor is deemed to have willingly assumed all risks only if trespassing while also committing or having the intention to commit a criminal act. Even if a person has willingly assumed all risks, an occupier still has a duty not to create a danger with intent to do harm to the person, or act with reckless disregard to the safety of the person. Option (3) is incorrect because the Occupiers Liability Act provides that an occupier is liable, and if Clara was leasing the lot, she could still be an occupier under the Act if she was in physical possession of the premises, or had responsibility for, and control over, the condition of the premises, the activities conducted on those premises, and the persons allowed to enter those premises. Option (4) is incorrect because as long as Clara is deemed an occupier under the Act, then she would be liable even if she was away from the lot at the time of the injury.

Answer 468

Answer: 3 Explanation: Option (3) is correct and Options (1), (2), and (4) are incorrect because filing a notice of civil claim is the first step to in bringing a claim.

Answer 469

Answer: 2 Explanation: Option (2) is correct because the parcel identifier (PID) is listed under the “Description of Land” section of a title search. Options (1), (3) and (4) are incorrect because these items are not listed on a title search.

Answer 470

Answer: 2 Explanation: Option (2) is correct because the immobile nature of land causes real property to be more influenced by externalities. Options (1), (3), and (4) are incorrect as they do not describe externalities resulting from land’s immobility.

Answer 471

Answer: 4 Explanation: In this question, straight-line means that each year the expense will be the same. We ignore CCA.

Answer 472

Answer: 2 Explanation: Option (2) is correct because items that are fixtures are considered part of the land and will belong to the buyer upon completion. Therefore, a seller of real property does not have the right to detach and remove any fixture after entering the contract of purchase and sale. Option (1) is incorrect because an object “prima facie” is considered a fixture once it is even slightly attached to real property, unless it is shown that it was intended to remain a chattel. Option (3) is incorrect because if an object is attached to the real property for the better use of the mirror, the owner will usually be entitled to remove the object (as it is considered a chattel) when the house is sold. Option (4) is incorrect because if an object cannot be removed without damaging the real property, then this is an indication that it is likely to be considered a fixture.

Answer 473

Answer: 2 Explanation: Option (2) is correct. Choosing debt financing instead of equity financing will not change the predictability of return on capital. Options (1), (3), and (4) are incorrect because they are valid reasons to choose debt financing over equity financing.

Answer 474

Answer: 3 Explanation: Option (3) is correct because agency/fiduciary law is an example of a common law source of duties to clients. Options (1), (2), and (4) are incorrect because they are examples of legislative duties to clients.

Answer 475

Answer: 2 Explanation: Option (2) is correct because Dave is not trespassing while committing or intending to commit a criminal act (as he was merely looking for casual work). Dave also does not fall under any of the other enumerated categories of visitors who are deemed to have willingly assumed all the risks of entering on a property under section 3 of the Occupiers Liability Act. Option (1) is incorrect because Mimi is an occupier since she is in “physical possession of the premises”, and the absent owners remain occupiers because they still have “responsibility for, and control over” the property. (There may be more than one occupier of the same premises as per section 1 of the Occupiers Liability Act.) Option (3) is incorrect because section 3(2) of the Occupiers Liability Act states that the duty of care imposed on occupiers applies in relation to the: (a) condition of the premises; (b) activities on the premises; or (c) conduct of third parties on the premises. Option (4) is incorrect because the duty of care imposed by the Occupiers Liability Act on an occupier is to take such care as in all the circumstances is reasonable to see that persons coming onto the property will be reasonably safe.

Answer 476

Answer: 3 Explanation: Press Display 11.75  NOM% 11.75 2  P/YR 2  EFF% 12.095156 12  P/YR 12  NOM% 11.472285 375000 PV 375,000 300 N 300 0 FV 0 PMT 3,804.161605 3804.16 +/ PMT 3,804.16 60 INPUT  AMORT PER 60-60 = = = 357,359.255413 357359.26 +/ FV 357,359.26 Now enter the market rate and determine the market value. The calculator steps continue as follows: Press Display 13  NOM% 13 2  P/YR 2  EFF% 13.4225 12  P/YR 12  NOM% 12.661289 60 N 60 PV 358,848.893364 (market value of the mortgage) + 55000 = 413,848.893364 (market value of the offer) The market value of Flutie’s offer is $413,850, rounded to the nearest $10.

Question Bank 2 Flashcards

(500 cards)