Duties

Customer Duties Customer duties are duties owned by the brokerage and salesperson/broker to the customer (3rd party) Specific duties: Should not make misrepresentations about property to customers Take care in asking customer inquiries to insure accurate and complete information General duties (MHD): Legal duty not to misrepresent Ethical duty to be honest Duty to take due care when making disclosures

Client Duties (COLD-AC) Competence – agent must exercise level of care expected from an average person in the occupation Principal liable for agent’s actions Obedience – agent must follow all reasonable and lawful instructions even if he doesn’t agree with it Loyalty – most important duty because duties to client are above all else except the law You must be loyal within scope of responsibilities Disclosure – agent must disclose all information that is relevant to the transaction, i.e. any information that affects the desirability/value of the property and all material information that is known

Client Duties (COLD-AC) Accounting – agent must account for all property, documents and money entrusted to them Confidentiality – agent is not allowed to use information that they have acquired from the principal in a way that would harm the principal Failure to perform duties owed may result in prosecution and liability from Registration authorities and the Local Board

Duties Clients Owe Brokers These duties are outlined in the Representation/Service Agreements Indemnification Brokers are not responsible for any loss or damage during the period when a property is listed or sold, so long as they act in a lawful manner If the agent acts without authority or in a manner that is unlawful, they will be held liable For instance, if an agent constructs a house in a vacant plot that they have listed, they will be held liable Indemnification in the Listing Agreement (Clause 7 of Form 200) now includes liability, loss, cost, claim, damage or injury that results from environmental problems or contamination

Duties Clients Owe Brokers Remuneration Brokers are entitled to commission for the services they provide Commission is to be paid once the property is sold In case of an incomplete sale, commission is still to be paid if the reason for the sale not going through is default or negligence on part of the seller/buyer The broker has a right to take commission from the deposit before they disburse the remaining funds to relevant parties such as the lawyers The seller must pay the broker any commission that is payable if the Deposit is not sufficient to cover the whole cost The seller agrees to pay tax on the commission that is payable to the broker