Comments: Multiple Representation
It seems clear that the Auditor General doesn’t like multiple representation:
- Seller and Buyer represented by the same Brokerage in a transaction,
- Two competing Buyers seeking the same property, both represented by the same Brokerage.
Rather than take the law as it is, and focus on RECO’s own responsibility, this broad approach seems to be rather peculiar.
OREA fought against changes to the Act, last year, not RECO.
In any event, there have already been some changes to REBBA 2002 by TRESA which will come into force in April 2023. Rather than wait and see how those changes will work out, the Auditor General wants to bring them all up again.
The Auditor General says:
Multiple representation….”…..poses a risk to the buyer and seller as the salesperson or broker cannot effectively represent the best interests of both parties.”
However, one good agent acting on both sides is better than two lousy agents who don’t know what they are doing.
The Auditor’s report focusses upon the fact that the one agent earns two commissions:
“….the registrant would earn a commission from both the buyer and the seller.”
This is not true in all cases, just some. However, frequently, the Listing agent does make more money if they are engaged by the Buyer. So, should that be permissible?
The Auditor General also says:
“There is also a risk that other buyers interested in the property are at a disadvantage because the registrant representing the seller may be motivated to have their own buyer purchase the property….”.
The RECO response defers the issue to the Ministry and the Ministry says “let’s wait” to see the impact of the new changes that have already been made.
All of this seems rather unnecessary and rather peculiar from the perspective of the Auditor General. It almost seems like they want more time, more money and a greater role with respect to audits.
Why don’t they just leave this type of issue to the people in the business?
And yes, I have been writing since 2005 that multiple representation, dual agency and customer service should be eliminated.
Brian Madigan LL. B., Broker