It’s getting a little close to the TRESA Phase 2 commencement, and the RECO Information Guide is still “coming soon”.
This could be a separate and distinct document or perhaps it will simply be an extended version of the Information Guide for Consumers.
So, here is the actual legislation covering this General Information Guide for Designated Representation.
“(2) The information guide shall include the following information:
1. An indication that a person may interact with a registrant,
i. as a client under a representation agreement, or
ii. as a self-represented party.
2. A summary of the rights and duties set out in the Act and the regulations in respect of registrants, clients and self-represented parties.
3. An explanation of the risks of being a self-represented party if a person chooses not to receive services, including representation, from a registrant.
4. A statement advising a person contemplating being a self-represented party to seek independent professional advice.
5. Guidance in respect of the duties that a brokerage would owe to a client and the services that the brokerage would provide to a client, if the brokerage entered into a brokerage representation agreement with the client.
6. With respect to situations where a brokerage enters into a designated representation agreement with a client, guidance in respect of the duties that the brokerage and the designated representative employed by the brokerage would owe to the client and the services that the brokerage and the designated representative would provide to the client.
7. An indication that agreements with brokerages may include terms related to termination of the agreement.
8. Guidance in respect of remuneration arrangements in relation to a trade in real estate, including a description of remuneration arrangements that are permitted and prohibited for,
i. a broker or salesperson, and
ii. a brokerage.
9. A caution that a brokerage is not permitted to represent more than one client in respect of the same trade in real estate unless the requirements set out in subsection 22 (1) are satisfied.
10. A caution that a designated representative is not permitted to represent more than one client in respect of the same trade in real estate unless the requirements set out in subsection 22.0.1 (1) are satisfied.
11. A caution that a brokerage and a designated representative employed by the brokerage are not permitted to represent their respective clients in respect of the same trade in real estate unless the requirements set out in subsection 22.0.2 (2) are satisfied.
12. With respect to situations where a brokerage represents more than one client in respect of the same trade in real estate, guidance in respect of the duties that a brokerage would owe to each client and the services that the brokerage would provide to each client.
13. With respect to situations where a designated representative represents more than one client in respect of the same trade in real estate, guidance in respect of the duties that the brokerage and the designated representative employed by the brokerage would owe to each client and the services that they would provide to each client.
14. With respect to situations where a brokerage represents a client and a designated representative employed by the brokerage represents a client in respect of the same trade in real estate, guidance in respect of the duties that the brokerage and the designated representative would owe to their respective clients and the services that they would provide to their respective clients.
15. An explanation of how to file a complaint about the conduct of a broker or salesperson to,
i. the brokerage that employs the broker or salesperson, and
ii. the administrative authority.
16. Any other information the registrar considers relevant in respect of the rights and duties set out in the Act or the regulations in respect of registrants, clients and self-represented parties. O. Reg. 235/23, s. 3.
(3) Before providing services or assistance to a person in relation to trading in real estate a registrant shall provide the person with a copy of the information guide or a link to the guide on the administrative authority’s website. O. Reg. 357/22, s. 10.
(4) Before providing services or assistance to a person in relation to a trade in real estate a broker or salesperson shall explain the contents of the information guide to the person. O. Reg. 357/22, s. 10.
Comment
You will notice that this particular Information Guide will be directed to “Designated Representation”
Who is the “agent”.
For years, it’s been the Brokerage. That causes potential problems for the Brokerage if it were to have 1,000 agents in a particular area. The chances of two independent agents working for the same Brokerage involved in a buy and sell would be high.
The solution, then, is to make the individual sales persons as the “agents” in law. Great solution: problem solved, no agency conflicts. The Brokerage is no longer the agent and simply provides “back end” services to the Buyer and the Seller.
Brian Madigan LL.B., Broker