You Walk a Fine Line with Multiple Represention in a Real Estate Transaction

Sales Representative

Kingsway Real Estate Brokerage

Mailmaster

WHAT IS MULTIPLE REPRESENTATION?

Multiple Representation in real estate is when the Brokerage/listing sales rep. sells the home of their client, to a buyer that is also their client.  For a buyer to become a client of the brokerage, they must sign a Buyer Representation Agreement. So now you are representing two clients and all the rules and regulations in regards to this is now in affect. If you get the buyer to sign Buyer Customer Agreement, then this is not multiple representation.

The terms “client” and “customer”, have legal ramifications set out in the Real Estate and Business Brokers Act, 2002  (REBBA, 2002), administered by Real Estate Council of Ontario (RECO)

In short, as registered sales representatives,  the information we provide and the things we say is based on whether we are dealing with a “client” or a “customer”. For example if I’m selling a home for my client, and a buyer who is a “customer” ask me how much will the seller take for their home (which has to be a standard question from buyers) I am legally not allowed to tell the buyer, unless I have obtained written permission from my seller. This is just one of the rules. Read the paragraphs below.

 MULTIPLE REPRESENTATION:

The information provide below, is taken from the Listing Agreement Provided by (TREB) Toronto Real Estate Board to it’s members.

The Seller hereby acknowledges that the Listing Brokerage may be entering into buyer representation agreements with buyers who may be interested in purchasing the Seller’s Property. In the event that the Listing Brokerage has entered into or enters into a buyer representation agreement with a prospective buyer for the Seller’s Property, the Listing Brokerage will obtain the Seller’s written consent to represent both the Seller and the buyer for the transaction at the earliest practicable opportunity and in all cases prior to any offer to purchase being submitted or presented.

The Seller understands and acknowledges that the Listing Brokerage must be impartial when representing both the Seller and the buyer and equally protect the interests of the Seller and buyer. The Seller understands and acknowledges that when representing both the Seller and the buyer, the Listing
Brokerage shall have a duty of full disclosure to both the Seller and the buyer, including a requirement to disclose all factual information about the Property known to the Listing Brokerage.
However, the Seller further understands and acknowledges that the Listing Brokerage shall not disclose:
• that the Seller may or will accept less than the listed price, unless otherwise instructed in writing by the Seller;
• that the buyer may or will pay more than the offered price, unless otherwise instructed in writing by the buyer;
• the motivation of or personal information about the Seller or buyer, unless otherwise instructed in writing by the party to which the information
applies or unless failure to disclose would constitute fraudulent, unlawful or unethical practice;
• the price the buyer should offer or the price the Seller should accept; and
• the Listing Brokerage shall not disclose to the buyer the terms of any other offer.
However, it is understood that factual market information about comparable properties and information known to the Listing Brokerage concerning
potential uses for the Property will be disclosed to both Seller and buyer to assist them to come to their own conclusions.

Where a Brokerage represents both the Seller and the Buyer (multiple representation), the Brokerage shall not be entitled or authorized to be agent for either the Buyer or the Seller for the purpose of giving and receiving notices.

MULTIPLE REPRESENTATION AND CUSTOMER SERVICE:

The Seller understands and agrees that the Listing Brokerage also provides
representation and customer service to other sellers and buyers. If the Listing Brokerage represents or provides customer service to more than one seller or buyer for the same trade, the Listing Brokerage shall, in writing, at the earliest practicable opportunity and before any offer is made, inform all sellers
and buyers of the nature of the Listing Brokerage’s relationship to each seller and buyer.

 

Sales Representative

Kingsway Real Estate Brokerage

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