Duties and Obligations of the Broker

When a transaction concerns a property that is not serviced by a municipal water system or equipped with a wastewater treatment system, financial institutions usually want assurances that the water is drinkable or the system is up to code before authorizing a loan.

CAPSULE

The new Real Estate Brokerage Act has abolished certain rules regarding the duty to have one or more managers, based on the number of brokers acting within an agency. This new Act is meant to be less interventionist regarding the management of a brokerage firm’s business.

The agency’s and broker’s duty to disclose during a real estate transaction is not new. Since May 1, 2010, the Real Estate Brokerage Act provides that this obligation does not concern only the agency’s or broker’s interest in an immovable, but also its or his interest in an enterprise. The duty to disclose is now extended to include a transaction relating to a loan secured by immovable hypothec. The Inspection Department deems it necessary to remind everyone of a few rules in this regard.

Do you want to inform your clients properly about the options available to them, especially regarding insurance? Here is an overview of the rules to observe.

In accordance with section 105 of the Regulation respecting brokerage requirements, professional conduct of brokers and advertising (hereinafter called “Regulation respecting brokerage requirements”), the broker and agency executive officer must collaborate with the OACIQ during the following operations

The importance to inform their clients selling and buying properties located in these risk zones of the problems related to pyrite and to recommend the specific actions described in this text.

On November 30, 2005, the Board of Directors of the Association des courtiers et agents immobiliers du Québec adopted a By-law amending the By-Law of the ACAIQ that fixes the premium payable to the Liability Insurance Fund, in accordance with the Real Estate Brokerage Act. The universal premium of $550 per member, per year, plus applicable taxes, is therefore confirmed. This is a great step toward being granted the insurer’s licence to actually launch the Fund in 2006. The adoption of this by-law follows a Five-Year Development Plan prepared by the actuarial firm of Eckler Partners Ltd. An accounting, actuarial and legal requirement of the Autorité des marchés financiers (AMF) prior to granting a licence, this development plan and the ensuing adoption of the by-law brings us another step closer to our goal. The by-law has been submitted to the government for approval. The timetable set by the ACAIQ to create the Fund is currently on schedule. Only a few steps remain before the AMF issues the insurer’s licence needed to launch the Fund.

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INSPECTION CAPSULE

When a chartered real estate broker is going to be absent for vacation or for any other reason, he is looking to entrust his operation to a member on whom he can rely. He also wants to do in a way that will be legal and secure for all parties involved.

Within the context of your duty to inform the parties of products and services that concern heritage protection and relate to the transaction, or more broadly in the general course of your activities, you sometimes refer your clients, with or without remuneration. This referral may be made to a firm or its representative, an independent partnership or an independent representative governed by the Act respecting the distribution of financial products and services (Distribution Act), or to a person registered under the Securities Act or the Derivatives Act (collectively, “AMF Registrants”). All these persons must be registered with the Autorité des marchés financiers (“AMF”).