In this Issue
Working Together to Enhance Consumer Protection
Also in this Issue:
Election of New Council Executive
Pre-Authorized Debit Forms: Written Authority and Informed Consent Required
Strata Management: 10 Years of Licensing
A joint team, comprised of senior staff and representatives from the Real Estate Council of BC, the Ministry of Finance and the Financial Institutions Commission (FICOM), is working to implement the recommendations of the Independent Advisory Group’s (IAG’s) Final Report, released June 28, 2016.
The composition of the implementation team represents the coordinated approach being taken to swiftly address and enhance consumer protection during this time of transition from self to government regulation of the real estate industry in BC.
On June 29, 2016 the government responded to the IAG’s report by announcing its intention to end the self-regulation of licensed real estate professionals in BC and to implement the report’s recommendations.The following month, the Real Estate Services Act was amended to end self-regulation of the real estate profession by replacing the Council’s governing board, increasing oversight, transparency and accountability to government, and increasing penalties for misconduct by real estate licensees. These amendments are expected to be brought into force in early fall.
Under the amended legislation, the Superintendent of Real Estate will become an independent office, with greater involvement in and oversight of the regulation of the industry by the Real Estate Council of BC. The most significant change to the Council’s regulatory role is the transfer of rule-making authority to the Superintendent. The Council will continue to be responsible for licensing, licensee and public education, investigation of licensee conduct and licensee discipline.
The IAG’s recommendations will enhance the Council’s ability to act in the public’s interest, and strengthen the regulation of the BC real estate industry. The implementation team is working to address the recommendations in the Final Report and we will be communicating regularly with licensees and consumers as they are implemented.
The Real Estate Council of BC will continue to…
The Council continues to carry out its mandate to protect the public interest by:
- enforcing licensee conduct requirements under RESA;
- issuing licences for individuals and brokerages;
- investigating complaints;
- responding to inquiries from consumers and licensees;
- disciplining licensees.
Amendments to RESA
Amendments to the Real Estate Services Act (RESA) were passed on July 28, 2016, ending self-regulation of the real estate industry in BC and introducing higher discipline penalties for contraventions under the Act. Regulations to bring the changes into force are now being drafted by government and are expected to be adopted in fall 2016.
The Council is committed to keeping licensees informed about all regulatory and rule changes that will affect their practices as soon as possible.
Significant amendments to RESA include:
- Appointment of a dedicated Superintendent of Real Estate who will have increased authority over the Council, including the ability to make rules governing the conduct of real estate licensees.
- Replacement of elected Council members with government-appointed individuals, as well as government appointment of the Council’s Chair and Vice-Chair.
- Changes to responsibility for training and supervision. Amendments to the legislation will mean that a brokerage’s unlicensed partners, directors, officers, sole proprietors or shareholders may not train or supervise licensees in respect of real estate services or the provision of real estate services.
- Significant increase in discipline penalties imposed on licensees and brokerages. Maximum penalties are increased from $10,000 to $250,000 for individuals, and from $20,000 to $500,000 for brokerages.
More information about the amendments, their impacts, and the implementation of the Independent Advisory Group recommendations will be released in the weeks ahead.
On July 19, 2016 Susan Lynch of RE/MAX Centre City Realty in Prince George was elected Chair of the Real Estate Council of BC. Dennis Fimrite of Firm Management Corp in Saanichton, was elected Vice-Chair.
The election of officers took place at the first meeting of this term’s newly elected Council, preceding the amendments to the Real Estate Services Act passed on July 28, 2016. Those amendments include the replacement of all elected Council members with government-appointed individuals. The changes to the Council’s makeup will take effect later this fall.
Until new Council members are put in place, the current elected and appointed members of the Council will continue to pursue the Council’s mandate to protect the public interest by enforcing the licensing and conduct standards for real estate professionals.
Ms. Lynch is a managing broker, 29-year licensee and five-year member of the Council. She is also a member of the BC Northern Real Estate Board, Canadian Real Estate Association and BC Real Estate Association (BCREA). Committed to high standards of professionalism and business practices, Ms. Lynch is a 20-year BCREA Applied Practice Course Instructor and serves as a RE/MAX Western Advertising Representative.
Working closely with Ms. Lynch and the other members of the Council is Vice-Chair Dennis Fimrite, a managing broker who has been licensed for 20 years. Mr. Fimrite has served as a Director and President of the Victoria Real Estate Board, has participated on industry and community committees and task forces, and is a member of the BCREA and Real Estate Institute of BC.
Ms. Lynch and Mr. Fimrite, with the support of fellow Council members, remain focused and committed during this time of transition to delivering on the Council’s mandate to protect the public.
Change is continuous. That has been my experience throughout my 29 years in the real estate industry in BC, and it’s truer now than ever before. I am honoured, during this time of transition for the Real Estate Council of BC, to have an opportunity – if only for a brief period – to serve as the Chair of the Council and work together with fellow Council members, staff and our government partners, to fulfill the Council’s mandate to protect the public.
A special thank you to Dennis Fimrite for serving as Vice-Chair and for his commitment, along with the other 14 elected and appointed members of the Council, for ensuring that the Council remains focused on its mandate during this transition. Thank you, again, to former Superintendent of Real Estate Carolyn Rogers and members of the Independent Advisory Group, who worked diligently to assess real estate practices and the regulatory framework in BC. And thanks also to the joint implementation team from the Council, the office of the Superintendent of Real Estate, and the Ministry of Finance, who are working just as hard to bring those recommendations to fruition.
The recommendations of the Independent Advisory Group will further strengthen the regulatory framework, demanding the highest levels of professional practice from licensees and enabling the Council to impose disciplinary penalties that are better aligned with infractions and with the realities of today’s market. Licensees have a duty and an obligation to protect the best interests of consumers in the real estate market, and our function is to ensure that these interests and practices are realized.
It is our understanding that the Council’s new structure, as amended by Bill 28, will be formalized later this fall. Until that time, the Council will remain focused on its priorities – protecting the public interest by enforcing the standards of conduct for licensed real estate professionals, and ensuring a smooth transition.
Susan Lynch, Chair
The Council office will be closed on Monday, September 5, 2016 for Labour Day and Monday, October 10, 2016 for Thanksgiving.
Launching Online License Renewal Applications
As part of the Council’s commitment to efficiency and effectiveness in regulating the licensing of real estate professionals, we’re introducing online renewal applications. Starting September 12th, 2016, all licensees will be able to apply to renew their licence using the Council’s Licensee Portal.
Approximately 6 to 8 weeks prior to your licence expiry date, you will receive an email from the Council letting you know that it’s time to renew. To apply for renewal online, visit the Council’s website and click “Licensee Login” in the upper right hand corner of the Council’s homepage.
The Council’s new online platform allows users to apply for licence renewal in 5 Easy Steps:
- Activate your online account
- Login to the Licensee portal
- Apply for licence renewal by completing the online form
- Pay your licence renewal fee using a credit card
- Certify the renewal application (this step must be completed by your managing broker)
Managing brokers must review all online renewal applications, using their online portal, and certify that they are satisfied the information is complete. Any paper applications must be reviewed and certified in hard copy.
Once the managing broker has certified the application, the Council’s licensing staff will review it to ensure the information is correct and complete, and all licensing requirements have been fulfilled. If approved, your licence will be renewed and sent to your brokerage along with a receipt.
For More Information
For detailed instructions on how to renew your licence online, and answers to common questions about online renewal, please visit:
New: Photo ID Required for Licence Applications
As of September 1, 2016, all new applications for licensing by individuals must include a copy of a valid piece of government-issued photo identification. The new requirement will enhance the Council’s ability to protect the public, by giving the Council additional tools to verify each applicant’s identity.
This requirement is mandatory for first-time applicants, as well as re-licensing and reinstatement applicants who have been unlicensed for more than 90 days, and director, officer or partner applicants who are not currently licensed or who have not been licensed or registered as a director/officer or partner under the Real Estate Services Act in the last 90 days.
The photo identification you provide must:
- have been issued by a provincial or territorial government of Canada, by the Government of Canada, or by another state or federal government;
- be valid (not expired) at the time it is provided, or
- if the photo identification does not have an expiry date, must have been issued within the last 5 years; and
- must contain your full legal name.
Acceptable forms of identification include:
- Motor Vehicle Driver’s Licence
- Valid Passport
- Nexus Card
- Canadian Citizenship Certificate Card
- Permanent Residency Card
- Certificate of Indian Status Card
For More Information
For more information, see Photo Identification Requirements.
Fall Seminar Series: Civil Resolution Tribunal for Strata Managers
To help strata managers learn more about BC’s new Civil Resolution Tribunal, we are pleased to offer a series of practical and informative seminars in the fall of 2016. Leading strata law expert Adrienne Murray will present these engaging half-day seminars, which are free of charge and open to licensed strata management professionals.
Participants will learn about the processes and procedures of the Civil Resolution Tribunal (the “CRT”) and the CRT’s impact on the strata management industry, including:
- how a strata corporation must respond to a complaint,
- how a strata corporation may initiate a complaint,
- the processes used by the CRT to bring a matter to conclusion, and the role of the strata manager in those processes,
- issues such as whether and how a strata manager may represent a strata corporation at various stages in a CRT proceeding, and
- amendments to the Strata Property Act introduced in conjunction with the legislation that brought the CRT into force.
For full information, including dates, locations, and details on how to register, see Fall Seminars: Civil Resolution Tribunal for Strata Managers.
Most brokerages providing strata management services use pre-authorized debit (PAD) forms to obtain agreement from individual strata lot owners to collect amounts owing to the strata corporation directly from the owner’s bank account. These approved withdrawals typically include strata fees, charges such as parking or locker fees, and special levies. In some cases, fines are also included on PAD forms.
Brokerages must ensure they have authorization and the informed consent of their clients before using PAD forms. Brokerages should be aware that collecting fines with PAD forms may be contrary to the provisions of the Strata Property Act.
If a brokerage intends to use PAD forms to collect strata fees and other funds owing to the strata corporation, it must ensure that it has the written authorization of the strata corporation. Section 3-3 of the Council Rules specifies that brokerages and related licensees may only act within the authority provided by their client.
If a brokerage wishes to use PAD forms as the only method for strata lot owners to pay funds owed to the strata corporation, it must first obtain the informed consent of the strata corporation to impose that restriction. The strata corporation should understand that such a restriction on payment options may be contrary to the provisions of the Strata Property Act (SPA).
The SPA does not identify how a strata lot owner should pay funds owed to the strata corporation. The standard bylaws simply state that “an owner must pay strata fees on or before the first day of the month to which the strata fees relate”. It may be difficult for a strata corporation to impose restrictions on how a strata lot owner fulfills their financial obligations to the strata corporation unless the strata has passed a bylaw imposing such a restriction.
Collecting Fines with PAD Forms
Strata corporations that wish to use PAD forms to collect fines from strata lot owners should be aware that this may be contrary to the provisions in the SPA.
Section 135 of the SPA requires the strata corporation to take certain steps before it is entitled to impose a fine.
The Council is of the view that the provisions of section 135 ensure a due process for strata lot owners. Including fines as one of the pre-approved withdrawals on PAD forms circumvents this due process, contravening the SPA. If a strata corporation instructs a brokerage to include fines in the PAD forms, the brokerage should urge the strata corporation to get legal advice on the issue.
It has now been 10 years since the Real Estate Services Act (RESA) first required that all individuals or companies who provide ‘‘strata management services’’ obtain licensing. That requirement was a first in North America for condominium managers. Today, as other real estate regulatory bodies in various jurisdictions are preparing to follow the example set in BC, we take this opportunity to examine how the BC requirement came about.
In October 2000, the provincial Ministry of Finance and Corporate Relations issued a White Paper on the proposed licensing of strata managers, after an inquiry into the quality of condominium construction recommended that all unregulated firms and persons who managed the finances and held the funds of condominium homeowners should be licensed. The White Paper endorsed the licensing recommendation, noting that licensing and regulation would ensure that strata managers :
- have the minimum appropriate skills and knowledge to provide strata management services to strata corporations; and
- are more accountable for their management of the common property, assets and affairs of strata corporations.
After consultation, the provincial government decided to enact a new Real Estate Services Act and Regulation, which came into force on January 1, 2005. One of the main initiatives undertaken in the development of RESA was to include a requirement for providers of strata management services to be licensed by January 1, 2006.
The Council was already licensing people engaged in real estate trading services and rental property management, and the addition of a strata management licensing requirement meant that there were now effectively three licensing paths for providers of real estate services. However, there was no list of active strata managers.
It turned out that there were approximately 900 active strata managers in the province. Approximately one-third of those strata managers were not licensed in another real estate service category (as either rental property managers or trading services representatives). In keeping with the model developed when licensing for property managers was introduced, strata management education was incorporated into the existing licensing education framework. The Council collaborated with the Real Estate Division at the Sauder School of Business, University of British Columbia to develop a Strata Management Licensing Course.
Creation of a new strata management licensing course
Course content was determined in part by the original White Paper recommendations, and also with the help of a focus group of practising strata managers and stakeholders. The White Paper identified the following key educational topics:
- strata property law and management;
- the Strata Property Act, including obligations of owners, the strata council and developers, meetings, voting, bylaws, minutes and dispute-resolution;
- related statutory requirements;
- financial matters, including budget preparation, expense allocation, contingency reserve funds, auditing and accounting principles, financial reporting, cash flow and insurance;
- maintenance and repair, planning, tendering, contract supervision, rules of project management, warranties, building systems design and maintenance; and
- contract management.
The advisory group also emphasized the need to address ethics, negotiation and personnel management in the new course.
The initial offering began in the summer and fall of 2005 with a small group of students. Student comments both during the course and upon completion resulted in some fine-tuning of the course content prior to full offerings beginning in January 2006. That year, the inaugural version of the strata management licensing course received the Pre-Licensing Education Award from ARELLO, the Association of Real Estate License Law Officials.
Keeping the course current and updated
The strata management licensing course is now reviewed and amended annually by UBC and substantive changes to the materials are made at the direction of the Council. In 2013, the Council requested a comprehensive review of the course.
The Council and UBC commenced a review of the Strata Management Licensing Course that led to comprehensive revisions of the curriculum to increase the focus on regulatory requirements and industry best practices. The revisions were based in part on input from industry stakeholders, including the provincial Condominium Home Owners Association (CHOA), the Vancouver Island Strata Owners Association (VISOA), the Professional Association of Managing Agents (PAMA), the Strata Property Agents of BC (SPABC), the legal community and representatives of the Provincial Government’s Ministry of Housing.
The current course refocuses the strata management education program in British Columbia squarely on public protection. In addition, the course addresses critical issues for a strata manager’s professional readiness, such as:
- management of sections;
- meetings planning and governance;
- financial management and reserve fund planning; and
- further details of the Strata Property Act.
This focus is in keeping with the government’s overriding purposes for the licensing and regulation of strata managers:
- to ensure that strata managers have minimum appropriate skills and knowledge to provide strata management services to strata corporations; and
- to ensure that strata managers are more accountable for their management of the common property, assets and affairs of strata corporations.
The revised Strata Management Licensing Course was recognized by the Association of Real Estate License Law Officials (ARELLO®) in September 2015 for Excellence in the Pre-Licensing Education category. As of 2015, there were 1,281 representatives in the province licensed to provide strata management services.
In today’s real estate market, the actions and conduct of licensees are under intense public scrutiny. Licensees need to be aware that many people are very concerned, offended and even angry about the volume of real estate advertising appearing in their mailboxes, and about receiving unsolicited phone calls from licensees, door-knocking campaigns, and other practices. Aggressive marketing tactics that target vulnerable consumers are a particular concern.
Read on for advice to help ensure that any real estate advertising you may choose to develop keeps consumers’ best interests in mind.
Q: I understand the Independent Advisory Group has recommended that the Council take increased action against “aggressive and predatory” advertising, particularly when it targets vulnerable people. What should I do to make sure that my advertising isn’t seen as aggressive or predatory?
A: It is important for all licensees to be aware of and sensitive to the concerns of the public regarding real estate advertising. Take those concerns into account before you begin considering any new advertising materials or developing a marketing campaign.
The Council encourages all licensees to step back and carefully consider, in the light of increased public concerns, how their proposed advertising materials or marketing tactics might be perceived by the public, before sending them out. Consult with your managing broker to ensure that your advertising messages are appropriate and that your proposed marketing practices are ethical.
Licensees are also advised to review the Advertising Guidelines in the Professional Standards Manual, and the Council Rules to ensure their advertising complies with the rules and guidelines adopted by the Council.
The Council Rules that relate specifically to advertising are:
- Section 4-6 Restrictions and requirements related to advertising generally
- Section 4-7 False or misleading advertising prohibited
- Section 4-8 Advertising in relation to specific real estate
These rules are intended to ensure the public is neither misled nor confused as to who is providing real estate services and to ensure the accuracy of representations being made about real estate and real estate services.
Since the June 2016 Report from Council newsletter, the following actions have been taken as a result of disciplinary hearings and Consent Orders conducted by the Council.
- Xiao Ming (Alban) Wang, Representative, Alban Wang Personal Real Estate Corporation, Interlink Realty, Richmond
- Andy Chi Chor Wong, Representative, Amex-Fraseridge Realty Ltd., Vancouver
- Sophiya Sadrudin Dewshi, Representative, Magsen Realty Inc., Vancouver
- Sandra Mae Haines (Sandra Smith-Haines), Representative, Royal LePage Prince Rupert, Prince Rupert
- David Scott Piercy, Representative, Scott Piercy Personal Real Estate Corporation, Engel & Volkers Vancouver Island, Victoria
- SUSPENSION ORDER: Jacob (Jack) Stephanian
- Christopher Scott Blake, Representative, Lexterra Real Estate Corporation, Kelowna
Gebhard (Geby) Charles Wager, Representative, Lexterra Real Estate Corporation, Kelowna,
John Wayne Ross, Representative, Lexterra Real Estate Corporation, Kelowna
- Michael B. Ireland, Representative, Michael Ireland Personal Real Estate Corporation, RE/MAX Colonial Pacific Realty Ltd., Surrey
- Robert Quinn Lee, Representative, Robert Q. Lee Personal Real Estate Corporation, One Percent Realty Ltd., Vancouver
- Dorothy Mae Wharton, Representative, RE/MAX Coast Mountains, Prince Rupert
- Nadia Movold, Representative, RE/MAX Coast Mountains, Prince Rupert
- Minoo Kalbasi Ashtri, Representative, Royal LePage Sussex, West Vancouver
- Dwayne Edward Launt, Representative, Sutton Group-West Coast Realty, Vancouver
- Emily Frances Kawaguchi, Representative, RE/MAX Coast Mountains, Prince Rupert
- Heather Ann Bullock, Associate Broker, Royal LePage Prince Rupert, Prince Rupert
- Chiow Min Kuan, Representative, Sutton Group-West Coast Realty (Vancouver East 49th Avenue Branch Office), Vancouver
- Lin (Kelly) Kong , Representative, Royal Pacific Realty Corp., Vancouver
Rental Property Management
Strata Management Services
- Alfred Albert Marchi, Managing Broker, Paragon Realty Corporation, Surrey and Paragon Realty Corporation, Surrey
- Concise Strata Management Services Inc., Brokerage, Nanaimo
- Melissa Nadine Ruyter, Representative, Concise Strata Management Services Inc., Nanaimo
- Michael Anthony Bertrand, Royal LePage Westside, Vancouver
- Dorset Realty Group, Ronald Joseph Schuss, Kim Ronald Schuss, Damien Joseph Paul Roussin, Leo Ka Kit Chan