Consent Order

REAL ESTATE COUNCIL OF BRITISH COLUMBIA

In the matter of the Real Estate Services Act

S.B.C. 2004 ch. 42

AND in the matter of a Consent Order pursuant to Section 41 of the Real Estate Services Act

Complaint: Contravention of sections 35(1)(a) [professional misconduct - breach of Act or Rules], 35(1)(d) [professional misconduct - incompetence], section 7(3)(a) [must not provide real estate services outside of brokerage], 7(3)(b) [must not accept remuneration outside of brokerage], and 27(1)(b)[payment into trust] of the Real Estate Services Act, and section 5-4 [acceptance of offer] of the Council Rules

Issue: Wendy Sukminder Lalli, currently unlicensed, while licensed as a representative, Little Oak Realty dba Re/Max Little Oak Realty, Abbotsford, committed professional misconduct within the meaning of sections 35(1)(a) and 35(1)(d) of the Real Estate Services Act ( "Act "), with respect to the marketing and sale of subdivision lots in a planned subdivision (the "Lands ") by a developer, in or about August 2005 to May 2006, in that she:

1. provided real estate services other than on behalf of the brokerage, in relation to which she was licensed, in contravention of section 7(3)(a) of the Act;
2. accepted remuneration from a person other than the brokerage in relation to which she was licensed, in that on or about October 11, 2005, she accepted remuneration in the amount of $50,000 in relation to real estate services directly from the developer, in contravention of section 7(3)(b) of the Act;
3. failed to pay or deliver to the brokerage in relation to which she was licensed, remuneration in the amount of $50,000 received on or about October 11, 2005, by way of payment from the developer, in contravention of section 27(1)(b) of the Act;
4. allowed, permitted and/or assisted the developer to breach the Real Estate Development Marketing Act ( "REDMA "), and in particular sections 10, 14, 15, 16 and 18 thereof, in that with respect to the sale of the subdivision lots in the planned subdivision, Lalli provided real estate trading services to the developer and to purchasers of the lots, in circumstances where:
   1. the developer received deposits from purchasers in relation to the development without placing the deposits with a brokerage, lawyer, notary public or prescribed person holding as a trustee in a trust account in a savings institution in British Columbia, in contravention of section 18 of REDMA;
   2. deposits were released from the trust account of the brokerage, contrary to the provisions of section 18 of REDMA;
   3. the Contracts of Purchase and Sale provided for deposits that exceeded 10% of the purchase price, in contravention of section 10 of REDMA and Policy Statement 6 of the Superintendent of Real Estate;
   4. purchasers were provided with copies of the Disclosure Statement, which misrepresented the deposit arrangements, in contravention of sections 14 and 16 of REDMA. In particular, the terms of the Contracts of Purchase and Sale entered into were inconsistent with the terms of the Disclosure Statement, in relation to payment of the deposits directly to the developer, and/or in relation to the amounts of the deposit, which exceeded 10%;
   5. purchasers were not provided with the Amendment to the Disclosure Statement, in contravention of sections 15 and 16 of REDMA;
   6. the developer entered into purchase agreements with the purchasers of the lots without having obtained a written statement from the purchasers acknowledging that the purchasers had an opportunity to read the Disclosure Statement, in contravention of section 15 of REDMA;
   7. the developer received deposits without any written Contract of Purchase and Sale being entered into with the purchasers, contrary to the developer 's Disclosure Statement;
5. failed to recommend legal advice to the purchasers in each case where the deposit was to be paid to the developer, in contravention of REDMA, and/or where the deposit exceeded 10% of the purchase price, in contravention of REDMA;
6. failed to deliver Contracts of Purchase and Sale to her brokerage upon acceptance, pursuant to section 5-4 of the Council Rules;
7. failed to provide copies of the Contracts of Purchase and Sale to the licensee representing the purchases until approximately eight months after acceptance, pursuant to section 5-4 of the Council Rules; and
8. demonstrated incompetence in relation to the marketing and sale of the lots in the subdivision.

Results

Wendy Sukminder Lalli 's licence was cancelled with no right to reapply for licensing for two years or until January 21, 2011 for professional misconduct as described above after an Agreed Statement of Facts, Proposed Acceptance of Findings and Waiver was entered into between the Real Estate Council and Wendy Sukminder Lalli, and a Consent Order was issued. Further, Wendy Sukminder Lalli was ordered to successfully complete the disciplinary education assignment applicable to Chapter 2 (The Real Estate Services Act), Chapter 5 (The Professional Liability of Real Estate Licensees) and Chapter 9 (Professional Ethics) of the Real Estate Trading Services Licensing Course, to enrol in and attend the first available CPE course "Contracts: Keep on Top of Changes " or "Risk Management for Realtors " as provided by the British Columbia Real Estate Association, and to pay enforcement expenses to the Council in the amount of $750.00. Upon Ms. Lalli becoming re-licensed and as a condition of continued licensing, Ms. Lalli 's managing broker(s) and their successors must (i) be provided with a copy of the Consent Order; (ii) for a one-year period following her re-licensing, provide quarterly reports to the Council commencing the third month after she becomes relicensed indicating that the managing broker has reviewed her contracts and other work in general; and (iii) promptly report to the Council anything of an adverse nature with respect to her activities for that one-year period.