Printed . This content is updated regularly, please refer back to https://bcfsa.ca to ensure that you are relying on the most up-to-date resources.

April 2016 Report from Council Newsletter

April 2016 Report from Council Newsletter

Report from Council
Published on
squircle icon

Select the section you’d like to navigate to.

  • Strengthening consumer protection to ensure that members of the public can have confidence in the standards of practice provided by licensed real estate professionals is always the Council’s first priority. The Council is pleased to have received the recent progress report from the Independent Advisory Group (IAG) that identifies 10 key areas to enhance public protection. We expect that the IAG’s final report in June 2016 will include recommendations in those areas, and we look forward to implementing measures to enhance the Council’s ability to enforce the Real Estate Services Act.

    In recent weeks the Council has made a number of announcements of new measures already underway to increase our capacity to investigate and discipline misconduct effectively and efficiently. All Council investigation plans will now include the participation of the Council’s new Legal Counsel-Compliance, and in cases of significant public risk, the Council’s investigators will team with private investigators. Those changes are the result of a process review initiated by the Council last year to enhance our ability to conduct investigations and improve the disciplinary process.

    The Council has announced licence conditions issued on Richmond-area brokerage New Coast Realty to ensure that the business complies with provincial laws for real estate brokerages. With these conditions, the Council has taken an unprecedented degree of control and oversight of the activities at New Coast Realty. We have taken these steps to protect consumers and ensure the brokerage cooperates with our investigation.

    We encourage any licensees, as well as buyers or sellers, who are concerned about the actions of a licensee to contact the Council with details. The Council can also investigate anonymous complaints.

    The IAG is inviting input from the public and industry stakeholders who would like to share their concerns and observations. The Council encourages licensees to review the progress report and share their feedback with the IAG directly at: [email protected].

    Learn more about the Independent Advisory Group, its members, mandate, and the Terms of Reference guiding its examination of the regulatory framework, conduct requirements, and enforcement of real estate licensees, at www.advisorygroupbc.ca.

    Recent Announcements from the Council:

    IAG Progress Report identifies 10 key areas in which the group expects to make recommendations, indicating strong enhancements to the regulatory framework.

    New Coast Realty licence conditions imposed by the Council sets precedent, protects consumers and ensures brokerage cooperates with investigation.

    Duty to Report FAQ. Reporting another licensee’s misconduct is one of your key responsibilities as a member of a self-regulating profession.

    New Measures introduced by the Council April 1 strengthen public protection.

  • This spring the Council is launching a consumer awareness campaign designed to give buyers and sellers of real estate practical tips to help them make informed decisions. The hot real estate market conditions in much of BC can be stressful, even overwhelming, for consumers to navigate. The Council’s online information campaign will help consumers find the information they need, whether it’s quick tips, easy-to-read fact sheets, or comprehensive guides to buying and selling property.

    More information about the campaign will be available on the Council’s website in the coming weeks. Look for campaign announcements in your local community paper, and online in May and June.

  • The progress report from the Independent Advisory Group (IAG) is clear-stronger measures to protect consumers are coming. The message to licensees is just as clear-we have a responsibility to uphold the highest standards of professional practice. Anything less is simply unacceptable!

    The Council is pleased with the key subjects that are under review by the IAG and highlighted in the progress report that was released April 11. The items being considered are far-reaching and the recommendations will enhance the regulatory framework that guides the actions and behaviors of real estate professionals.

    So what does it mean to be a professional?

    First of all, it means that we have specific expertise, which we use to provide our clients with a high level of service and expert advice that enables them to make informed decisions. Secondly, it means that as members of a profession, we are trusted to regulate ourselves.

    That’s why we have a Real Estate Council of BC today-because many years ago, hard-working, forward-thinking real estate professionals said to government, “We can regulate ourselves. You can trust us.” Since then, we have worked closely with consumers, educators and government. We earned the public’s trust. For nearly 60 years, the public’s trust has been justified. The Real Estate Council of BC has maintained high standards for educating, licensing, regulating, and disciplining real estate professionals.

    But being a self-regulating professional also means that each of us must take personal responsibility for upholding the standards of professionalism-including reporting misconduct by others when we see it. Every real estate professional should know they must bring misconduct to their managing broker’s attention-and that managing brokers must inform the Council of any misconduct that puts consumers at risk. See our new Duty to Report FAQ for more information.

    If you encounter misconduct by another licensee or industry representative, don’t look the other way. As professionals, we must speak up when we see wrongdoing-and that means making sure that the Council has the information they need to investigate and discipline. The recent addition of more legal and investigative resources at the Council enabled us to take swift action on April 8 and impose stringent licence conditions on New Coast Realty to protect consumers.

    The recommendations from the IAG’s progress report are expected in early June. What I know for certain is that what is best for the public is also best for the real estate profession. We must be united in our commitment to raising the standards of professional practice and in our efforts to protect the public.

    Marylou Leslie, Chair

    Election Information

    Council elections are being held electronically in 2016. Licensees in districts with elections, should have received election materials and voting instructions by email. Please read all the material carefully. You must cast your vote by 4pm PST on Tuesday, May 10, 2016.

    If you have any questions about the voting procedures, please contact the Council at [email protected].

  • The Council office will be closed on Monday, May 23 for Victoria Day.

  • Under the provisions of the Strata Property Act (SPA) strata corporations are required to provide forms and other documents upon request. Some brokerages use online providers exclusively to process these requests on behalf of their strata corporation clients, while others offer a choice between online and offline ordering and delivery.

    Has the Strata Corporation Agreed?

    Section 3-3 of the Council Rules states that a brokerage must disclose to the client all known material information respecting the real estate services it will provide to its client. If a brokerage intends to provide documents through a third party service provider, before entering into an agreement with a provider the brokerage must ensure that the strata corporation has consented.

    Third party companies that provide strata documents on behalf of brokerages charge the person requesting the form a prescribed fee along with a “convenience” fee and in some cases a “rush” fee for documents required very quickly. If your brokerage uses an online provider to fill requests for Form B: Information Certificate, and Form F: Certificate of Payment, you should be aware of provisions in the Regulations to the SPA that place limits on the amounts that can be charged for processing and delivery of these forms, based on the time limits for delivery.

    Provisions in the SPA

    Sections 59 and 115 of the SPA provide that strata corporations must provide a copy of Form B and Form F within one week of a request. If documents are requested to be provided in accordance with the timeframe set by the SPA, the Regulation establishes the maximum amount that can be charged.

    Sections 36(3) and 59(1) of the SPA and section 25 of the Interpretation Act effectively give the strata corporation eight days, following receipt of a request, to deliver a Form B, the bylaws and rules and up to 15 days following receipt of a request to provide copies of the other records maintained by the strata corporation. Under the SPA, unless a request for documents is personally presented to a strata council member, the strata corporation is deemed not to have received the request for 4 days. Therefore, unless a request for documents has been personally presented to a strata council member, the 8 and 15 day periods do not start until 4 days after the request was faxed, mailed or emailed to the strata corporation or strata management brokerage.

    The Regulation sets the maximum fee that a strata corporation may charge for providing a copy of a record or document and the fees for providing a Form B and a Form F.

    The maximum fee that a strata corporation may charge for providing a copy of a record or document prescribed under section 35 of the SPA is 25¢ per page. The maximum fee for a Form B, including the required attachments, is $35, plus the cost of photocopying, or other means of reproduction, at no more than 25¢ per page and the maximum fee for a Form F is $15 (these rates are subject to change by regulation). The fees are applicable if the documents are requested to be provided in the time frames as set out above. The Regulation prohibits any charge to an owner, or his or her authorized delegate, for inspecting the strata corporation’s records.

    While the SPA and the Regulation establish both maximum timeframes and maximum fees for providing copies of a strata corporation’s records, the legislation is silent on whether additional fees may be charged for providing these records in a shorter time period than the maximum allowed.

    When strata corporations, or strata managers acting on their behalf, are requested to provide documents sooner than stipulated by the legislation, licensees should be aware that some brokerages may charge additional fees.

    This means that…
    • If someone requesting strata documents is willing to wait the full period of time permitted under the SPA for the documents, the maximum fee that Using Third Party Service Providers to Process Document Requests can be charged is the fee set out in the Regulations.
    • If an individual wishes to obtain the documents and forms in less than the prescribed time, a rush fee or priority fee may be charged. However, in all such cases, the person requesting the documents must be given the option to wait for the documents to be delivered within the period contemplated in the SPA and be charged the maximum permitted by the SPA and the Regulations. If they choose to request the documents in a shorter period of time, they may be charged a rush or priority fee.
    • If an individual has the option to either use an online provider or obtain the documents by conventional means (e.g. picking up the documents or requesting that they be emailed or faxed), and chooses to use the online provider, any additional charges (such as “convenience” fees) imposed by the online provider are costs that the individual has chosen to incur.
    • If a person requesting documents is willing to wait the full period of time for the documents and has no option but to obtain the documents through the online provider, charging an additional fee is contrary to the maximum fee provisions of the Regulations. If the online provider is the only means by which documents can be obtained, neither the strata corporation nor its agents or employees are permitted to charge in excess of the maximum fee permitted by the Regulations.

    Is Personal Information Safeguarded?

    The strata corporation’s obligation, and therefore the brokerage’s obligation, to keep personal information confidential includes information that is under their control but not in their custody. This means that the brokerage’s contract with the third party service provider must contain provisions to ensure that the third party service provider will not use or disclose any personal information obtained as a result of providing the service, except as authorized by the Personal Information Protection Act.

  • Homeowner Protection Office Releases Updated Regulatory Bulletin

    Earlier this year the Homeowner Protection Office (HPO) released a revised Regulatory Bulletin on “Buying or Selling an Owner-Built Home.” Available on the HPO’s website, the newly updated bulletin is recommended reading for property owners building their own home, real estate licensees, legal professionals, notaries, lenders and home buyers. The bulletin clarifies the Registrar’s position on offering to sell an owner-built home prior to obtaining an Owner Builder Disclosure Notice. Licensees representing either owner builders or prospective home buyers may find this information useful prior to buying or selling ownerbuilt homes.

    The bulletin includes information on:

    • Occupancy and disclosure requirements for owner-built homes: An owner builder must occupy their new home themselves for at least one year after obtaining an occupancy permit and are not permitted to sell or rent the new home during that one-year period. Owner-built homes may not be sold within the first 10 years after occupancy without providing an Owner Builder Disclosure Notice to the prospective purchaser. The Disclosure Notice must be provided to prospective purchasers prior to entering into a Contract of Purchase and Sale. Disclosure notices can be obtained from the HPO and will not be released until the one-year occupancy requirement has been verified by the HPO.
    • New Homes Registry: The easiest way to determine whether a home can be offered for sale is to search the HPO’s online New Homes Registry at www.hpo.bc.ca. New homes not found on the Registry or by calling the HPO should not be sold until verified by the HPO.
    • Illegal Sales: Selling a home without providing prospective purchasers with an Owner Builder Disclosure Notice is an offence under the Homeowner Protection Act. This includes signing a Contract of Purchase and Sale without first providing an Owner Builder Disclosure Notice. Offering to sell or selling an owner-built home within 12 months after receiving an occupancy permit is also an offence under the Act.

    This means that offering to sell an owner-built home for which an Owner Builder Disclosure Notice has not been issued is risky:

    • If the seller has not met the minimum occupancy requirement they may be committing an offence by offering to sell too early.
    • Even if an owner builder has met the 12-month occupancy requirement, if they list the home before receiving an Owner Builder Disclosure Notice, they may receive an offer to purchase without having provided an Owner Builder Disclosure Notice to the prospective purchaser as required by the Homeowner Protection Act. The offer may fall through while the owner waits for the Owner Builder Disclosure Notice from the HPO, or the owner may accept the offer prior to providing the Owner Builder Disclosure Notice, thereby committing an offence under the Act.

    The Registrar strongly recommends obtaining an Owner Builder Disclosure Notice from the HPO before offering to sell an owner-built home. The Owner Builder Disclosure Notice confirms that the home may be offered for sale.

    The Council will be reviewing the information for licensees in the Professional Standards Manual relating to ownerbuilt homes to determine if any updates or revisions are required, and will advise licensees in due course of any changes.

    For more information:

    HPO Regulatory Bulletin #5: Buying or Selling an Owner-Built Home

  • Steps to Take When there are Adverse Claims to a Deposit

    The buyers have made an offer, the sellers have accepted it, and now it’s time for the deposit to change hands. This is an exciting moment for many buyers, the point when a real estate transaction begins to seem “real”.

    But not all transactions are meant to be. When subject conditions aren’t removed and a deal collapses, those deposit funds in the brokerage’s trust account can become the object of a dispute between the buyer and seller, with the brokerage caught in the middle.

    The brokerage’s position is clear: the brokerage holds the deposit as a stakeholder, not as an agent for either the buyer or seller. What’s not always clear is which party is entitled to the deposit. Either the buyer or the seller, or both, may try to claim the funds, depending on the circumstances that led to the collapse of the deal.

    As a stakeholder, the brokerage must remain impartial in cases where there is disagreement over who is entitled to the deposit. It is not the brokerage’s responsibility to determine who should receive the deposit. Even if the contract seems clear-for instance, setting out that in the event of a collapsed sale the deposit is payable, to the seller-unless both the buyer and the seller have given written consent by way of a trust release, the funds cannot be released, and the matter may have to be decided by the courts.

    While the brokerage can try to facilitate an agreement between the buyer and seller, these negotiations can become time-consuming, and in some cases of dual agency, can put the brokerage in a conflict of interest if they advocate for one of the parties over the other.

    So what’s a brokerage to do when buyers and sellers both wish to claim the deposit, and can’t reach an agreement? There are two choices:

    1. Recommend the respective parties obtain legal advice and continue to hold the deposit in trust until both parties have signed a trust release which clearly indicates to whom the money is to be disbursed, as required by section 30(2) of the Real Estate Services Act (RESA).
    2. Make an application to the Supreme Court to have the money paid into court, under the provisions of section 33 of RESA. Once the money is paid into court, the brokerage has discharged its duty and has no further liability in connection with the funds. Full details on the process and costs associated with making an application are available in the Brokerage Standards Manual.

    For Further Information:

    Tips to Prevent Deposit Disputes

    When a real estate transaction collapses, no one is happy but by taking certain steps before an offer is made and accepted, licensees can help ensure that disputes don’t arise later between the buyer and seller over the deposit. Licensees should:

    • Clearly explain to their clients the terms of the contract, including the terms of the deposit. If questions arise that the licensee cannot answer, the clients should be directed to consult a lawyer.
    • Ensure the contract includes clear conditions about the return of deposits. When the contract is explicit and clear, chances may be reduced that the brokerage will encounter difficulties in getting the parties to agree, in writing, to disbursing funds held in trust.

  • This month’s question concerns the recently revised Applied Practice course that new trading services licensees must complete before receiving their permanent licence. The new, longer course features additional content on the legislated requirements for practice, and has a greater emphasis on key concepts like agency and avoiding conflicts of interest. New licensees must complete a number of assignments for the course during their first months of work. So what does this mean for experienced licensees and managing brokers?

    Q: New licensees at my brokerage are working on their assignments for the Applied Practice Course and asking me for advice. What are my responsibilities? I’ve heard that new licensees just have a temporary licence-are there restrictions as to what they’re able to do with a temporary licence?

    A: Since the introduction of the new Applied Practice Course, the Council has received a number of questions from licensees asking what the changes mean to them. In particular, many new licensees are curious about what they’re able do with a temporary licence. Meanwhile, managing brokers and associate brokers want to know what their responsibilities are when new licensees at their brokerage are completing the practical field assignments during Component 3 of the Applied Practice course.

    The goal of the new course is to strengthen understanding of the regulatory requirements of agency, disclosure and contracts and how to put them into practice as required by the Real Estate Services Act (RESA) and the Council Rules. With each component of the course, a new licensee will build upon the theoretical knowledge gained in the Real Estate Trading Services Licensing Course. First they learn the Why, the How and the Tools. Then they learn how to put those into practice with role play. Once licensed, they are required to reflect upon their real world experience working with clients in the brokerage setting with oversight from the managing brokers. Finally they have a chance to come together to review the concepts and develop further learning paths.

    Temporary licence

    The Council has always issued temporary licences to new licensees until they have completed the Applied Practice Course. A temporary licence does not restrict licensee activities. However, if all four required components of the Applied Practice Course are not completed within six months of the licence being issued, it will be cancelled. The dates on the licence can be confirmed by a licensee’s brokerage. Once the course is completed, the licence will be automatically transferred from temporary to permanent status.

    Managing Broker responsibilities

    Once someone is licensed with a brokerage, managing brokers are responsible for the activities of that licensee. The new Applied Practice Course does not change that responsibility in any way, or introduce new responsibilities for the managing broker.

    We have heard that many managing brokers are using the practical field assignments in Component 3 to model brokerage training programs, or to enhance existing brokerage training programs. For managing brokers who want to know more about the Applied Practice Course and the assignments their licensees must complete, the British Columbia Real Estate Association (BCREA) has developed an Applied Practice Course Toolkit for managing brokers. The toolkit provides managing brokers with the full set of commercial and residential course materials for all four components of the course. You can find the toolkit on the BCREA’s website.

  • Since the February 2016 Report from Council newsletter, the following actions have been taken as a result of disciplinary hearings and Consent Orders conducted by the Council.

    Trading Services

    Rental Property Management

    Strata Management Services

    • Ian James MacKay

    Notice of Permanent Surrender of License

    Add to Anti-Banner