No Explanation of Services – Agent Faces Penalties
This situation is a little different, but unfortunately, somewhat commonplace.
Omar Shariff is a real estate agent working with ABC Brokerage. A condominium apartment was listed by Barney Noble of XYZ Brokerage. A consumer was introduced to Barney and he referred the matter to Omar.
Documents to acquire the property were prepared by Omar and Barney.
On August 7, 2012, Omar submitted the follwing documents to the Brokerage:
i) “Buyer Representation Agreement”, dated July 1, 2012 (the “July 1 BRA”);
ii) Individual Identification Information Record, dated July 30, 2012 (the “July 30 ID Form”) with Barney listed as “Sales Representative/Broker Name” and with the individual’s name not included but including the Complainant’s information;
iii) A copy of the Agreement of Purchase and Sale.
It should be noted, Omar never met the prospective purchase at any relevant time, never dealt directly with respect to any of the documents, and signed as witness although he never saw the Purchaser.
On August 7, 2012, Barney emailed Omar, enclosing a draft Waiver, purporting to waive the Financing Condition. In that e-mail, Barney set out the name of the buyer’s lawyer, seller’s lawyer, the Buyer’s cell phone number, his name and his e-mail address, the seller’s cell phone number and his name and the following instructions:
“Please contact [Mortgage Broker] and make sure the mortgage is done. It should be done by Friday. Then call buyer and send the waiver to sign which should backdate July 30/2012. [SIC]. Also get the status certificate from the seller when its ready and send it to… law office. Please inform your office about the buyer’s lawyer.”
Subsequently, Omar continued to prepare documents for the transaction including a Waiver and an Amendment.
Here are the notations with respect to the summary of the case before the Discipline Committee:
a) Did not, on behalf of the Brokerage:
(i) At the earliest practicable opportunity inform the Complainant about the nature of that Brokerage’s services as set out in Section 10 of the Code of Ethics to the Act (“Code”), and did not at any time endeavor to obtain the Complainant’s acknowledgement in writing of this information at any time, contrary to Section 2(1) in respect of Sections 10(1) and 10(2) of the Code, and contrary to Sections 3 and 5 of the Code.
(ii) At the earliest practicable opportunity, reduce a buyer representation agreement to writing, have it signed on behalf of the brokerage and submit it to the Complainant for signature, contrary to Section 2(1) in respect of Section 14 of the Code, and contrary to Sections 3 and 5 of the Code.
b) Forward a document that appeared to have been dated before that date, namely the August 7 Draft Waiver, contrary to Sections 3 and 5 of the Code and Section 38 in respect of the duty to prevent error, misrepresentation and unethical practice.
c) Signed as a witness to the Property APS which he did not see signed, contrary to Section 5 and 37(1) of the Code and Section 38 in respect of the duty to prevent error, misrepresentation and unethical practice.”
Omar was assessed a $6,000.00 fine and was required to attend an Ethics Course and a Law Course offered by the Real Estate Institute of Canada (REIC).
It’s always nice to help out friends. But, don’t get bullied. You still have to do your job. It was Omar and his Brokerage ABC Real Estate who were “on record” in this deal.
First, an agent must explain various types of real estate services, including agency. Deliver some information concerning agency. Then, offer to reduce the relationship to writing. In this case, agency or client services was selected. That means the Buyer Representation Agreement should be produced, offered to the client for signature and filed with the Brokerage.
Need I say that you can’t identify someone who is not in your presence. In this case, Barney did the identification under FINTRAC but he was not authorized as a Mandatary in order to do so. He had no standing in this deal.
And, naturally you cannot “witness” a document if you were not present. That’s the purpose of a witness, namely to see and observe the person sign.
These are all serious transgressions.
Note: As a rule, I use fictitious names. The actual case is published on RECO’s website and is available to the public. For educational purposes, the names of the parties really don’t have any bearing. If you need to quote the case, you will have to obtain the proper legal citation.
Brian Madigan LL.B., Broker