Consent Order

Roderick Alexander MacKay, Managing Broker, Maude, MacKay & Company Limited, Vancouver

Maude, MacKay & Company Limited, Brokerage, Vancouver

File 13-120 and 14-122

Consent Order: September 6, 2016

Summary of File 13-120

Roderick Alexander MacKay provided strata management services to a strata corporation. He prepared monthly financial statements and Form B's which reported a balance of the Contingency Reserve Fund greater than the actual amount held in trust. By failing to ensure that his brokerage prepared and maintained proper financial records, Mr. MacKay contravened section 25 of the Real Estate Services Act and sections 3-1(3)(a) and 8-1(1) of the Council Rules.

As a managing broker, Mr. MacKay failed to ensure that his brokerage prepared and retained monthly reconciliations for the Contingency Reserve Fund. This contravened sections 3-1(3)(a) and 8-2(c) of the Council Rules.

Mr. MacKay transferred funds out of the Contingency Reserve Fund as loans to the strata's general account without first obtaining the written authority of the strata council. By failing to act in accordance with the lawful instructions of his clients, Mr. MacKay contravened section 3-3(b) of the Council Rules and section 30(1) of the Real Estate Services Act.

Mr. MacKay paid strata corporation expenses from his personal Visa account and reimbursed himself from the strata account fund. These actions were outside his scope of authority and were committed without written authorization from the strata council, contravening section 3-3(c) of the Council Rules.

Mr. MacKay was asked by his client to revise his manager's report for the Annual General Meeting Notice. He distributed the Notice without making the requested revisions. By failing to act on the instructions of his client, Mr. MacKay contravened section 3-3(b) of the Council Rules.

Maude, MacKay and Company Limited reported that the balance for the strata corporation's Contingency Reserve Fund was greater than the actual amount held in trust. This was a failure to prepare and maintain proper financial records, contravening section 25 of the Real Estate Services Act and section 8-1(1) of the Council Rules.

The brokerage failed to prepare and retain monthly reconciliations for the Contingency Reserve Fund in its monthly financial statements. This contravened section 8-2(c) of the Council Rules.

Summary of File 14-122

Mr. MacKay charged the client management fees that did not correspond with the fee structure in the Service Agreement. By failing to put amendments in writing and to obtain signatures from his client for these amendments, he contravened sections 5-1(6) and 3-3(c) of the Council Rules.

Mr. MacKay improperly withdrew increased amounts from the trust account for management fees without a signed written agreement. His actions contravened sections 30(1) and (2) of the Real Estate Services Act.

Mr. MacKay charged the client higher management fees than authorized in the Service Agreement and then had members of the strata council sign amended versions of the Service Agreement allowing him to charge these fees after the fact. His actions contravened section 35(1)(a) of the Real Estate Services Act.

Mr. MacKay had members of the strata council sign amended Service Agreements. The first amended agreement failed to include provisions recommended by a Council audit and contained an amount for management fees that did not reflect the amount the brokerage was charging. The second and third amended agreements also contained amounts for management fees that did not accurately reflect the amount that the brokerage was charging. Mr. MacKay's actions demonstrated incompetence and contravened section 35(1)(d) of the Real Estate Services Act.

Maude, MacKay and Company Limited charged the strata corporation management fees that did not correspond with the fee structure in the Service Agreement. It failed to put amendments to the Service Agreement in writing and failed to obtain signatures from the client approving those amendments. This contravened sections 5-1(6) and 3-3(c) of the Council Rules.

The brokerage improperly withdrew increased fees from the trust account without a signed written agreement. This contravened sections 30(1) and (2) of the Real Estate Services Act.

Results

A discipline committee of the Council has ordered the following:

1. Mr. MacKay and Maude, MacKay & Company Limited are each reprimanded.
2. Mr. MacKay must pay a discipline penalty of $10,000.00 to the Council.
3. At his own expense, Mr. MacKay must register for and successfully complete the Broker's Remedial Education Course.
4. Mr. MacKay and Maude, MacKay & Company Limited are jointly and severally liable to pay enforcement expenses of $1,500.00 to the Council.