BC Real Estate Trading Services Course Professionalism and Ethics Questions and Answers

Question 1

A real estate licensee in BC is representing a seller.
The licensee's cousin submits an offer on the property.
According to the BC Financial Services Authority (BCFSA) Rules, what is the licensee's primary obligation in this situation?

Accepted Answer

To promptly disclose the conflict of interest in writing to the seller before presenting the offer.

Answer

To advise the seller to reject the offer to avoid any potential for perceived bias.

Answer

To recommend their cousin's offer over others as they can personally vouch for the buyer.

Answer

To keep the family relationship confidential to ensure the offer is judged on its own merits.

Question 2

Which of the following actions by a licensee constitutes a breach of the duty of confidentiality owed to a client?

Accepted Answer

Telling a buyer's agent that the sellers are motivated because they have already purchased another home.

Answer

Informing a potential buyer that the property has a material latent defect, even if the seller client instructed them not to.

Answer

Disclosing the amount of commission the brokerage will receive on a successful sale.

Answer

Advertising the property's square footage as listed on the official strata plan.

Question 3

A licensee lists a property with a known, intermittent foundation leak that only occurs during very heavy rainfall. The seller instructs the licensee not to mention it, as it hasn't happened in over a year. A buyer completes the purchase without being informed and discovers the leak months later. Under the Real Estate Services Rules, what is the licensee's failure to disclose this issue best described as?

Accepted Answer

A failure to disclose a material latent defect.

Answer

A breach of the duty of loyalty to the seller.

Answer

An acceptable execution of a client's lawful instruction.

Answer

A simple matter of 'caveat emptor' (buyer beware).

Question 4

According to the Real Estate Services Act (RESA), the primary mandate of the BC Financial Services Authority (BCFSA) is to:

Accepted Answer

Protect the public interest by regulating the real estate industry and ensuring licensee competence.

Answer

Set standard commission rates for all real estate transactions in the province.

Answer

Provide legal representation for licensees facing disciplinary action.

Answer

Lobby the provincial government on behalf of the real estate industry.

Question 5

A mortgage broker, pleased with a licensee's recent referral, offers the licensee a $500 gift card as a thank-you. According to the BCFSA Rules regarding remuneration, what must the licensee do?

Accepted Answer

Disclose the offered gift card to their client in writing and obtain the client's consent before accepting it.

Answer

Accept the gift card, as it is not cash and therefore not considered remuneration.

Answer

Refuse the gift card, as licensees are prohibited from accepting any compensation from third parties.

Answer

Accept the gift card but only disclose it to their managing broker.

Question 6

The REALTOR® Code, which is administered by the Canadian Real Estate Association (CREA), is a set of ethical principles that guide the conduct of its members. The Preamble to the Code explicitly states that its obligations are based on which guiding principle?

Accepted Answer

The Golden Rule.

Answer

The Principle of Caveat Emptor (Let the Buyer Beware).

Answer

The Maximization of Client Profit.

Answer

The Primacy of the Brokerage's Interests.