Report from Council Newsletter, March 2018

Report from Council
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  • As you read through the articles in this issue of the Report from Council newsletter, you may notice an emerging theme: first, there is the Anonymous Tipline. Next, you’ll find a piece about the Sanctions Guidelines that were recently approved and are now available on our website. Also, there is another piece about the launch of a survey to explore the experiences of individuals who make complaints and the licensees who are named in complaints. All three are significant steps forward in our ongoing work to implement the recommendations of the Independent Advisory Group. But they are more than that.

    These initiatives are indications of a regulator in transition. The Real Estate Council is responding to the changing needs of the public and real estate licensees. As we enter our 60th year, these changes are clear examples that in fact you’re never too old to learn new tricks. Of course, we remain committed, first and foremost, to protecting the public interest, which has been our mission since 1958. But I hope you’ll agree that with initiatives such as inviting anonymous tips, publishing guidance on disciplinary sanctions, and asking for feedback on the complaints processes, we’re beginning to build a new relationship with our stakeholders.

    One of the Council’s goals in our recently published Strategic Plan is to be recognized as a trusted regulatory authority — and building that trust starts with real estate professionals as well as with consumers. Our organizational values include openness, transparency, collaboration and seeking diverse perspectives, and with measures like the ones announced in this issue, we feel like we’re making a good start at living up to those values.

    As we continue to work towards the implementation of the new consumer protection rules, along with further new rules published for consultation earlier this month and expected to be brought into force in the future, we’ll be keeping those values and that goal front and centre.

    If you have feedback that you’d like to share about anything you read in this issue, you can get in touch with us at [email protected].

  • “See something? Say something!” began as a U.S. law enforcement campaign aimed at raising public awareness about the importance of reporting suspicious activity. It quickly became so successful that the slogan has been adopted by various agencies around the world, including by BC’s own TransLink.

    At its heart, the campaign speaks to the importance of reporting suspicious behaviour to the correct authority. Here in BC, as real estate licensees you play a crucial role in ensuring that the public interest is protected in real estate transactions. Whenever you believe that consumers are at risk from another licensee’s actions, you have a duty to promptly report the conduct to your managing broker, who can bring it to the attention of the Real Estate Council.

    We realize that in some cases individuals may have concerns about coming forward to report misconduct. As part of our ongoing commitment to protecting consumers, earlier this month we launched an anonymous tipline, making it easier for licensees and members of the public to anonymously report suspected wrongdoing.

    Anonymous Tipline: The Nuts & Bolts

    You can speak to a trained staff member at the Anonymous Tipline via telephone (1.833.420.2400) from Monday to Friday, 8 a.m. to 4 p.m., who will listen to your concerns and advise you about your reporting options.

    You can also report suspected misconduct through our secure, anonymous online tip form.

    Our trained staff will assess the tip to determine if an investigation may be required, and if there is sufficient evidence provided in the tip to proceed.

    Remember, while you don’t need to leave your name, you do need to include enough information for the Council to take action — otherwise, we can’t begin an investigation.

    The information you provide will help us determine whether we should undertake an audit, launch an investigation or take other compliance action. The more details you provide, the more you can help us evaluate your lead — and prevent misconduct from occurring.

    By coming forward, you are contributing to a more professional real estate industry, and enhancing public trust in the profession.

    More information:
  • Need to access a strata plan for your client? Strata corporations in BC are required by the Strata Property Act to file copies of strata plans, bylaws and other records with the Land Title and Survey Authority of British Columbia (Land Title Office).

    Make sure your client receives the registered copy of the strata plan available from the Land Title Office, or through myLTSA. Strata plans from other sources may not be up-to-date and may not be the official copy.

    Why is a Strata Plan Important?

    Strata plans include information about the legal boundaries and dimensions of a surveyed parcel of land, including parking, common property, limited common property, etc.

    They identify the features associated with the strata lot, such as balconies and decks, and their designation, along with the designation of parking and storage.

    You should obtain a copy of the strata plan at the time of listing a strata lot. The strata plan can then be provided to potential buyers, along with any other documents requested.

    To obtain a strata plan for your client, the Council recommends that you contact the Land Title Office, or download it from myLTSA. The Land Title Office is the only definitive source of accurate registered strata plan information.

    More Information for Trading Services Licensees:

    Guidance for Strata Management Licensees

    The Strata Property Act requires strata corporations to hold the registered strata plan (and any amendments) in their records.

    Before providing a strata plan to an owner, purchaser, or authorized person, check to ensure that the copy you receive from the strata corporation is the registered copy, and that it includes all amendments. If it is not the registered copy, you should let your clients know that you need to access the most recently registered strata plan.

    As obtaining the registered copy of the strata plan from the Land Title Office will involve an expense, you should seek your client’s approval first.

    More Information for Strata Management Licensees:

  • On Wednesday, March 21 the Office of the Superintendent of Real Estate asked real estate licensees and members of the public to comment on proposed amendments to the Real Estate Rules. The Superintendent’s consultation is open for 30 days, until April 20, 2018.

    You can submit your comments to the Superintendent using this online survey.

    The rules proposed by the Superintendent will:

    • incorporate the Real Estate Council of British Columbia’s English language proficiency requirement for new applicants into the Rules;
    • create a new requirement for licensees to complete continuing professional education courses from time to time, typically when significant new rules are introduced;
    • designate the first continuing professional education course to be completed by trading services and rental property management licensees;
    • mandate that new remuneration disclosures include a dollar amount; and
    • create new rules to address conflicts of interest where a licensee finds themselves potentially working with multiple parties that would constitute dual agency.

    We encourage all licensees and members of the public to contribute their thoughts on the package of new rules which have been published for consultation. To submit your comments, complete the consultation survey. The consultation period closes on April 20, 2018 at 6:00 p.m.

    Are you thinking about adding another service category to your licence? Maybe you’re licensed to provide trading services, and you’re thinking of adding rental property management to your licence, to expand the range of services you can offer to clients. Here are a few key facts you should know:

    1. You Have a Year to Add the Service after passing the exam

    You will need to complete a supplemental licensing course, and then pass a supplemental exam for the service category you’d like to add to your licence. After passing the supplemental exam, you will have up to one year to add the service category to your licence.

    If you passed a supplemental licensing exam before September 2017 and you haven’t added the category to your licence yet, please email [email protected], or call 604-683-9664 to find out more information.

    2. Your Brokerage Must Provide the Service

    If you are interested in adding additional real estate service categories to your licence, check with your managing broker to make sure that your brokerage is licensed to provide those services.

    You cannot provide a service that your brokerage is not licensed to provide.

    3. Don’t Forget about the Applied Practice Course

    If you plan to add trading services to your licence, in addition to completing the supplemental course and passing the exam, you must also successfully complete the Residential or Commercial Applied Practice Course.

    For more information, review the Council’s Frequently Asked Questions About Education and Licensing Requirements.

    We are committed to providing a complaints process that is thorough, effective, timely and fair to both the individuals who make complaints and to the licensees who are named in complaints. To understand better where we can enhance our processes, and how we are doing at meeting the expectations of complainants and licensees, earlier this month we launched an online survey.

    The survey asks members of the public who have filed complaints and licensees who have been named in complaints to give us feedback: did they receive enough information throughout the investigation; were their interactions with Council staff handled professionally; did the investigation and discipline process meet their expectations. The results of the survey will assist us in making enhancements to the services we provide to protect the public interest.

    We will continue to survey complainants and licensees throughout the coming year, and we will be reporting on the results, along with any changes to our processes as a result of the feedback we’ve received.

    At its February meeting, the Council approved publication of Sanction Guidelines, now available on the Council’s website. The Sanction Guidelines will assist the Council’s discipline committees in determining appropriate penalties and remedial measures for licensees who have been found liable of professional misconduct.

    They also can help the public and other stakeholders to understand the basis for penalties and remedial orders and why some may be chosen over others in a particular case.

    Publishing Sanction Guidelines is part of the Council’s ongoing commitment to improving the transparency of its complaints and discipline processes.

    To learn more, read the Sanction Guidelines.

    Effective March 7, 2018, amendments to Strata Property Regulation 6.9 clarify that variable user fees are permitted for the use of strata common property.

    A consumption-based rate may be charged to users to recover expenses as long as it is reasonable and in a strata bylaw or rule. For example:

    • water use in bare land strata corporations or
    • electricity usage for strata residents charging their electric vehicles.

    These amendments are part of ongoing efforts to reduce regulatory barriers and are expected to promote the approval of and access to electric vehicle charging stations in strata properties.

    More Information

    To learn more, read the:

    On March 6, BC Housing announced that the BC Home Owner Mortgage and Equity (HOME) Partnership program will end March 31, 2018.

    In its place, the Province will create a HousingHub that will facilitate new partnerships to increase the supply of affordable housing, and develop innovative models to allow prospective homeowners to purchase homes and build equity. The HousingHub will be funded in part by winding down the BC HOME program.

    Until March 31, applications for the BC HOME Partnership will continue to be considered for approval, and current program recipients will not be affected by the phase-out.

    For more information, review BC Housing’s recent news release.

  • Q: My seller client wants to invite offers for their property in bitcoin. Is this legal?

    A: There is no law prohibiting the use of digital currencies for the purchase or sale of real estate in BC, meaning there’s nothing stopping a consumer from buying or selling a property using bitcoin.

    However, there are risks to using digital currencies like bitcoin. If you have clients who are considering buying or selling with a digital currency, you should advise them to get expert legal or accounting advice to ensure they are well-informed about these risks.

    All licensees have a duty to protect their client’s best interests and should ensure that where there are additional risks in a transaction, such as with the use of digital currency, they take extra time to provide clear advice and document that advice with the transaction.

    Here are some of the issues that real estate consumers should be made aware of:

    Digital currency can’t be held in trust

    Digital currency can’t be legally held in a trust account in Canada, because they exist outside the purview of banks and governments. Brokerages can’t receive a bitcoin deposit and hold it in a trust account.

    The buyer and the seller would need to negotiate for a third party to hold the deposit, which brings an increased level of risk. In a trust account, the funds are protected should the deal collapse. If the deal were to collapse using a digital currency, your client may have to find the other party and sue them to recover the deposit.

    Increased risk of money laundering

    While bitcoins can be used legitimately for many purposes, there are also significant risks associated with them, including the risk that the currency may be used to disguise the source of money derived from criminal activities — commonly known as money laundering. For more information, read Bitcoins and the Risks of Real Estate Fraud: 3 Facts You Need to Know.

    Currency levels are hard to predict

    Swings in digital currencies can happen very quickly. Your client might enter into a Contract of Purchase and Sale for a set number of bitcoin and find by the time the transaction closes that the value of those bitcoins has changed drastically — possibly to your client’s advantage, or possibly to their disadvantage.

    It’s important before assisting your clients in a digital currency transaction that you understand how to mitigate or eliminate the risks in any contract or negotiation.

    Consumers should get expert advice

    If your client is considering using digital currency, you should recommend they get expert legal advice to understand the risks, and to safely navigate the transaction. Because of the volatility, risks and complications associated with using digital currency, advise your client to seek out all information he or she needs to make an informed decision.

    Do you have suggestions for future You Asked Us articles? Send your questions to [email protected].

  • Since the February 2018 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 (Sales)