BC Real Estate Trading Services Course Real Estate Law & Contracts 3 — Questions and Answers
Question 1: In BC, if a seller fails to complete a valid contract of purchase and sale, the buyer's remedies include:
- Only return of the deposit
- Specific performance or damages (Correct answer)
- Filing a complaint with BCFSA only
- Automatic transfer of title
Correct answer: Specific performance or damages
When a seller breaches a valid real estate contract in BC, the buyer can seek specific performance (court order to complete the sale) or damages for loss suffered.
Question 2: Under RESA, the managing broker of a brokerage is responsible for:
- Setting commission rates in BC
- Supervising the trading activities of licensees under the brokerage (Correct answer)
- Registering titles at the Land Title Office
- Issuing mortgage approvals
Correct answer: Supervising the trading activities of licensees under the brokerage
Under RESA, the managing broker bears responsibility for supervising all trading services activities of licensees employed by or associated with the brokerage.
Question 3: A Contract of Purchase and Sale in BC becomes binding when:
- The buyer signs the offer
- Both parties have signed and the acceptance has been communicated to the offeror (Correct answer)
- The deposit is paid
- The subjects are removed
Correct answer: Both parties have signed and the acceptance has been communicated to the offeror
A contract is formed when there is offer, acceptance, and communication of that acceptance to the offeror. Simply signing is not enough — the acceptance must be communicated.
Question 4: Which of the following clauses in a BC purchase contract allows the buyer to exit if they cannot arrange financing?
- Completion clause
- Subject to financing clause (Correct answer)
- Deposit clause
- Possession clause
Correct answer: Subject to financing clause
A 'subject to financing' clause makes the contract conditional on the buyer obtaining satisfactory financing. If financing is not obtained by the subject removal date, the buyer can void the contract.
Question 5: In BC, the Property Disclosure Statement (PDS) is:
- Legally required for all property sales
- A voluntary disclosure document where sellers disclose known facts about the property (Correct answer)
- Prepared by the buyer's agent after inspection
- Required only for strata properties
Correct answer: A voluntary disclosure document where sellers disclose known facts about the property
The Property Disclosure Statement in BC is a voluntary (not legally mandated) form where sellers disclose known facts about the property's condition. Sellers can refuse to provide it, but agents must advise buyers of its absence.
Question 6: Under the Limitation Act BC, the basic limitation period for most real estate claims is:
- 1 year
- 2 years (Correct answer)
- 6 years
- 10 years
Correct answer: 2 years
The Limitation Act BC sets a basic 2-year limitation period from the date a claim is discovered. After this period, most civil claims including real estate disputes become statute-barred.
BC Real Estate Trading Services Course Real Estate Law & Contracts 3
In BC, if a seller fails to complete a valid contract of purchase and sale, the buyer's remedies include: