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Report from Council Newsletter, October 2019

Report from Council Newsletter, October 2019

Report from Council
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  • RECBC is always focused on continuous improvement as a modern public protection agency and that means we evolve with the times.

    While we put consumers at the forefront of everything that we do, we do not often speak about the vital role real estate professionals play in consumer protection. Real estate professionals work at the front lines and often are the first to raise alarms when they suspect non-compliance or misconduct. Reporting suspected misconduct is such an important aspect of what real estate licensees do and how they contribute to professionalism. RECBC is not on hand every time real estate services are delivered to ensure that things go smoothly. Nor should we be there, given the high professional standards that most licensees demonstrate on a daily basis. There are not many professions where you provide expert advice to help people make one of the most important financial decisions of their lives.

    Real estate professionals have a unique perspective on the marketplace. They work on a daily basis with real estate consumers and they have an in-depth view of industry trends. They are able to tell us about potential problems or issues as they arise. The opportunity to share information and learn from each other has significantly improved over the past few years as RECBC has committed to engaging in dialogue with licensed professionals, partners and stakeholders through its Stakeholder Engagement Framework. In addition, RECBC provides a number of platforms to share information and engage in dialogue such the RECBC website, Report from Council, e-blasts, managing broker webinars, RECBC social media accounts, industry presentations and engagement events.

    We know licensed professionals are dedicated to the mandate of protecting real estate consumers because they know the public’s trust is not to be taken lightly. Real estate professionals take pride in their work and are proud representatives of the profession. A key aspect of being part of a regulated profession is taking an active role in upholding the ethics, standards and professionalism that define it. The vast majority of real estate professionals agree with this view, that it is a shared responsibility between RECBC and real estate professionals. During engagement events that RECBC held across the province in 2017 and 2018, we often heard about the desire for more education and resources. It showed us that real estate professionals want to elevate professional standards and raise the level of knowledge for all who work in the industry.

    As a result of the feedback we received, we have substantially revised the consumer disclosure forms which were launched on September 30. The revised forms are now just two pages long, they are easier to understand and are more readily accessible to different audiences. To strengthen educational rigour, we have brought mandatory education back in house to RECBC. Furthermore, we will be launching the new anti-money laundering course that will elevate the level of knowledge on this important issue later this year.

    As RECBC continues to transform its programs and services to become a more proactive and transparent regulator, we are also reflecting on what has not changed which is our mandate of consumer protection, our commitment to education and our accountability to government, the public, partners and stakeholders.

    Lastly, I’m pleased to announce that Linda Allen was appointed the new Chair of the Governance Committee and five Council members have been reappointed: Robert Gialloreto (vice chair), Sukhmander Sidhu, Karen Ameyaw, Yasin Amlani and Blaire Chisholm. I look forward to working with them as we move forward in fulfilling RECBC’s mandate of protecting the public interest. For more information on the Council members, visit the RECBC website.

    As always, if you have any questions or comments, please email us at [email protected].

  • The Office of the Superintendent of Real Estate (OSRE), in collaboration with the Real Estate Council of British Columbia (RECBC) and the Policy and Legislation Division of the Ministry of Finance (Ministry), is reviewing the role and responsibilities of managing brokers in BC’s real estate regulatory framework and are looking for input from licensees and other industry stakeholders.

    The project was initiated to identify challenges for managing brokers and risks to the industry and consumers in light of changing business practices that are impacting the real estate industry and the role of managing brokers. The project also explores options for the future of the managing broker role, ensuring that it continues to support appropriate protections for consumers and fosters a strengthened culture of professionalism among real estate licensees. Specifically, we are looking to ensure that regulatory framework:

    • (1) Provides adequate protection for consumers in light of ongoing changes within the industry;
    • (2) Enhances public confidence in the regulation of real estate services; and
    • (3) Appropriately align responsibility and liability within the real estate industry.

    A discussion paper has been developed that summarizes key issues and challenges facing managing brokers and the industry, identifies measures that can be undertaken in the short to medium term to strengthen the role of managing brokers as it currently exists, and proposes three high-level concepts for the future role of the managing broker over the longer term.

    Read the Discussion Paper.

    If you are interested in helping shape the future role of the managing broker, the Office of the Superintendent wants to hear from you. Real estate professionals, industry stakeholders and the public are invited to submit feedback on the discussion paper by email to [email protected] on or before December 15, 2019. Alternatively, feedback can be sent by mail to Office of the Superintendent of Real Estate, Suite 2800 — 555 West Hastings Street, Vancouver, BC V6B 4N6. Specific discussion questions are embedded in the paper. Please note that this is not a consultation regarding amendments to the Real Estate Rules.

    Your feedback will help inform the Superintendent’s work moving forward. OSRE will continue to engage with real estate professionals as any proposals are developed further. Additional background information on the project, including summaries of past engagement activities and feedback received are available on the project website.

    Questions on the discussion paper or on the project more generally can be directed to [email protected].

    Thank you in advance for helping to shape the future of real estate regulation in BC.

  • Looking for information about regulatory education or to register for a trading services Legal Update course? The RECBC website is now your go-to source.

    As of October 1, RECBC assumed full responsibility for all aspects of regulatory education. This includes the development and delivery of the trading services Legal Update courses and Applied Practice Courses.

    “We look forward to engaging directly with instructors and real estate professionals on the important regulatory education required by RECBC,” says Pam Skinner, RECBC Vice President of Education and Licensing.

    Register for Regulatory Courses

    Information on the Legal Update and Applied Practice Courses is available along with course schedules and registration instructions. If you require assistance or have any questions, send an email to [email protected] (Applied Practice Courses), [email protected] (Legal Update) or call us at 1.877.683.9664.

    Ongoing Development of Regulatory Education

    RECBC looks forward to exploring opportunities to develop and deliver new regulatory courses. As we announced earlier this year in the Report from Council, one new course already under development is focused on anti-money laundering. We will provide updates in the coming months, stay tuned for further details.

  • Understanding your agency duties and responsibilities is essential for good practice as a real estate licensee. In this series of articles noted real estate lawyer Bruce Woolley explores aspects of agency, including how agency affects the activities of teams, making referrals, sharing revenue, and more. Whether you are an experienced licensee looking for a refresher on agency or just getting started, these articles are essential reading.

    This article explores conflicts that involve current clients and former clients.

    The first thing to consider is section 3-3 of the Rules. The section provides that a licensee must:

    • act in the best interests of the client;
    • maintain the confidentiality of information respecting the client;
    • take reasonable steps to avoid any conflict of interest; and
    • if a conflict of interest does exist, promptly and fully disclose the conflict to the client.

    You may wonder, what would be wrong with continuing to act for your current seller client in a purchase and sale transaction in which your former client, the potential buyer, is “on the other side?” Your “former” client may not view their relationship with you as terminated.

    The following questions can help you to identify potential issues working with a former client. What if you had done five transactions in the last two years for a client, and now that “former” client is the potential buyer of property for which you are the designated agent of the seller? Do you think they might still view you as their licensee? Might the situation be viewed as implied agency? What if you had acted for the former client 10 years ago? What if you had acted for them last week?

    Part of dealing with the situation you face is to realize that each one will be fact specific, and at a minimum you must manage risks and expectations. First, do not wait until you are part way into the transaction before you raise the issue of possible conflicts of interest. It may be prudent to raise the issue with your current client at the beginning of the agency relationship and to explain what might happen if a former client becomes interested in that listing.

    Second, ask yourself if you possess confidential information respecting that former client that could influence your behaviour or your current client’s decisions. Remember, you have an ongoing duty of confidentiality to your former client and you cannot share information you learned while acting as an agent for your former client. What if you know that the former client always opens with a very low offer? You cannot tell your existing client, but surely that is important and relevant information for them.

    At the same time that you have the duty of confidentiality to your former client, you have a duty to act in your current client’s interest and to disclose any material information to them. You need to ask yourself if that confidential information would be relevant to the current client, so that your ability to act might be impaired. In that case, you may not be able to act for the current client.

    If you are satisfied you can continue to act for the current client, you should tell them that the potential buyer is a former client and you will not be able to disclose to them any confidential information from the former client.

  • Are you requesting more information than you should from potential tenants?

    Some tenant application forms have questions that may be considered inappropriate or even illegal under BC’s Personal Information Protection Act (PIPA). In BC, rental property owners and real estate professionals acting for owners must comply with PIPA when collecting personal information from individuals.

    Finding a tenant for a rental property is a real estate service that both rental property management licensees and trading services licensees can provide. As a real estate professional, when you provide this service you are acting on behalf of the owner of the rental property. It is your responsibility to collect enough information so that you or your client can make an informed decision and select the right tenant for the property. However, you must balance your professional obligation to your client with your responsibility to comply with the requirements of PIPA.

    To be sure that you are not asking for more information than you should, review the Guidance Document for Private Sector Landlords and Tenants from the OIPC. It has been written to assist landlords, agents and tenants to understand the types of information that can be collected, when it is appropriate to collect this information, how it should be stored, how it may be used, and how a tenant can access their own personal information from a landlord.

    For example, asking prospective tenants to disclose personal information on application forms such as Social Insurance Numbers is not information that is reasonably required at the application stage. Applications that require these kinds of inappropriate personal information may be in breach of PIPA.

    Real estate professionals who find tenants for their clients are responsible to ensure that they comply with PIPA. Review the Guidance Document periodically to ensure that you do not act in a manner that puts your clients, yourself and tenant applicants at risk.

    More Information:

  • For the most up-to-date information from RECBC on the risks of radon, please see

    Radon is an invisible, odourless, colourless radioactive gas. It is produced by the breakdown of uranium, which exists in small amounts in most bedrock and soils in Canada. When radon is released into the atmosphere it gets diluted, but it can enter dwellings through pipes and openings. Radon gas can get trapped inside a building, and accumulate to high levels. Over time, exposure to elevated radon levels poses a significant health risk, and radon exposure is a leading cause of lung cancer.

    The Professional Standards Manual provides guidance on the responsibilities of a licensed professional in relation to radon. In addition, an article recently published by the British Columbia Real Estate Association provides an overview of radon and its effects on human health, along with useful practice tips for real estate professionals to ensure you are upholding high levels of professional standards when it comes to radon and real estate transactions.

    As a real estate professional, you are expected to demonstrate competency by being knowledgeable about local environmental conditions and to alert consumers to the existence of health or environmental concerns related to the geographic area. For matters outside of your expertise, you need to advise consumers to seek independent advice.

    You can take a proactive approach by bringing radon gas awareness into conversations with consumers. Regardless of whether you are working with a seller, buyer or prospective tenant, you have the ability to raise the level of knowledge about radon and ultimately help save lives.

    More Information

  • Revised versions of three mandatory consumer disclosure forms are now available:

    In addition, a disclosure form specifically for use with residential tenants is now available:

    We developed these new and revised forms following consultation with licensees and consumers, to make them shorter, clearer, and easier to use. Here’s what you need to know about some of the key changes to the forms:

    Disclose your team. Each form includes a field where you can enter the name of your team and the names of licensed team members. Use this field if you are a member of a team registered with RECBC.

    Not sure if your team is registered? Use RECBC’s Licensee Search to search for a real estate team by name. Search results will show all the licensed team members currently registered with RECBC.

    Now Re-Usable! The Disclosure to Sellers of Expected Remuneration form now includes a table so that the same form can be used for up to three counter-offers. Note that in the Payment Details section, the order of the fields is now slightly different than in the original form.

    Residential Tenancies Form Now Available on RECBC Forms App. The new Disclosure for Residential Tenancies form is now available on the RECBC Forms App along with the revised versions of the Disclosure of Representation in Trading Services and the Disclosure of Risks to Unrepresented Parties. We’ve also made changes to the app to make it easier to navigate and use with consumers. Check it out for yourself!

    Review before you use. Read through the new and revised forms carefully before using them with a consumer for the first time, to make sure you understand how to complete the forms correctly. You can find lots of helpful information about the forms in our interactive, mobile-friendly Toolkits.

  • Recent inquiries to RECBC indicate there is some confusion over the assignment of all or a portion of remuneration to a third party. Greater clarity regarding the assignment of remuneration to third parties is available in the Professional Standards Manual (PSM) and Brokerage Standards Manual (BSM).

    Licensees may, in some circumstances, assign their remuneration to a third party, for example to their creditors. However, they cannot assign remuneration as a means of paying an unlicensed individual or corporation for services that require a licence.

    If you have any questions or require further information, please contact our Professional Services Advisors at [email protected].

    Each issue of Report from Council is designed to bring you news and updates on regulatory matters that impact your professional life as a BC real estate licensee. We want it to be informative, engaging and useful. So we’d like to hear from you. To ensure we are keeping pace with your needs, we want your opinions. We will use your feedback to help us make Report from Council a relevant, timely and impactful publication. We’ll report back on the survey results in a future edition and our plans for Report from Council moving forward.

    Take the readership survey today!

    If you have any questions about the survey, please contact [email protected].

    To help you learn more about the people who work at RECBC, in upcoming issues of Report from Council, we will introduce you to a member of the RECBC team. In this issue, a profile of Adriana Watkins, who leads RECBC’s team of auditors.

    Name: Adriana Watkins, CPA, CA

    Title: Senior Manager, Audit and Assurance

    Department: Audit

    Year started working at RECBC: 2019

    Tell us what you do at RECBC (in 30 words or less)?

    I manage the Audit department inspection program and yearly filings for the accountant and the brokerage activity reports. I train and mentor a team of auditors and I answer questions from managing brokers.

    What do you enjoy most about your role?

    The best thing about my role is working with my team to help managing brokers meet their regulatory requirements and to improve their business practices. The work we do ensures consumers are protected which aligns with my personal values of making a meaningful contribution to society.

    What would you like managing brokers to know about RECBC audits?

    I encourage you to ask questions. No question is too small or large. The auditors and I are here to help you.