BC Real Estate Trading Services Course Agency Relationships & Disclosure 3 — Questions and Answers
Question 1: Under BCFSA rules, a licensee must disclose their personal interest in a transaction (e.g., they are buying the property themselves) to:
- BCFSA only, in a prescribed form
- The seller, in writing, before or when the offer is presented (Correct answer)
- The listing brokerage only, verbally
- Their buyer clients only
Correct answer: The seller, in writing, before or when the offer is presented
Under RESA and BCFSA rules, a licensee purchasing property for themselves or their associates must disclose this interest to the seller in writing before or when presenting the offer.
Question 2: In BC, 'informed consent' to dual agency requires that:
- The client simply sign a form without explanation
- The licensee explain the risks of dual agency and the client voluntarily agree in writing (Correct answer)
- Consent is given verbally to save time
- Consent is only required from the seller, not the buyer
Correct answer: The licensee explain the risks of dual agency and the client voluntarily agree in writing
Informed consent to dual agency requires that the licensee explain the nature of dual agency, the potential conflicts, and the limitations on their duties, and that both parties then agree in writing.
Question 3: Which of the following is NOT a fiduciary duty owed by a BC real estate agent to their client?
- Loyalty
- Confidentiality
- Obedience to all instructions
- Guaranteeing the sale price (Correct answer)
Correct answer: Guaranteeing the sale price
Fiduciary duties include loyalty, confidentiality, disclosure, obedience to lawful instructions, accounting, and reasonable care. Guaranteeing a sale price is not a duty — it is impossible and would be a misrepresentation.
Question 4: In BC, when a licensee represents a buyer through a buyer agency agreement, who pays the buyer's agent's commission?
- Always the buyer directly
- Typically the seller pays via the listing commission, which is split with the buyer's brokerage (Correct answer)
- The real estate board distributes commissions
- The government covers buyer agent costs
Correct answer: Typically the seller pays via the listing commission, which is split with the buyer's brokerage
In most BC transactions, the seller pays a total commission to the listing brokerage, which then co-operates by sharing a portion with the buyer's brokerage, even though the buyer's agent represents the buyer.
Question 5: Under RESA BC, which of the following must be disclosed to a buyer by any licensee involved in the transaction?
- The seller's minimum acceptable price
- Known material latent defects affecting the property (Correct answer)
- The listing commission amount
- The seller's future plans for the proceeds
Correct answer: Known material latent defects affecting the property
All licensees involved must disclose known material latent defects to buyers. This is a statutory duty that applies regardless of which party the licensee represents.
Question 6: In BC, a 'sub-agent' in real estate is:
- A buyer's agent who finds a property listed by another brokerage
- An agent appointed by the listing agent to assist with the transaction on behalf of the seller (Correct answer)
- A junior licensee supervised by the managing broker
- A property manager acting for a strata corporation
Correct answer: An agent appointed by the listing agent to assist with the transaction on behalf of the seller
A sub-agent is an agent appointed by the principal agent (listing agent) to act on behalf of the same client (seller). Sub-agency has largely been replaced by buyer agency and designated agency in modern practice.
BC Real Estate Trading Services Course Agency Relationships & Disclosure 3
Under BCFSA rules, a licensee must disclose their personal interest in a transaction (e.g., they are buying the property themselves) to: