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Buyer representation Agreement - Who is representing Who ...


Question: What types of representations out there for Buyers?

Answer: Real Estate and Business Brokers, Act 2002 clearly distinguishes between a client and a customer. A customer is someone who has entered into some form of service agreement with a brokerage but is not represented by that brokerage. A customer relationship might arise when a buyer seeks selected brokerage services to facilitate a transaction, while not wanting advice from the salesperson or broker during the process. A customer must be clearly differentiated from a client.

Examples of buyer's represented as a customer.

1. A buyer calls the listings brokerage and ask for the representative to show the property, but do not enter into a Buyer Representation Agreement. In this case the Brokerage and their representatives are working for the seller's best interest pursuant to the representation agreement created with the Agreement of the Purchase and Sale document.

2. A buyer calls a Realtor to show a property that is not listed by the REALTOR's brokerage and the buyer does not enter into the Buyer Agency Agreement with the brokerage. In this case the REALTOR is working as a Sub-Agent for the seller and representing the sellers best interest pursuant to the representation agreement created with the Agreement of the Purchase and Sale document.

In both cases the salesperson or broker has fiduciary duties to the seller/client and must act in that client's best interests. To do so, the brokerage representatives performs certain fiduciary responsibilities. While difficult to precisely define, most real estate texts highlight six fiduciary duties: accounting, competence, confidentiality, good faith/full disclosure, loyalty and obedience. In both cases the buyer/customer, while not owed fiduciary duties, must be dealt with fairly, honestly and with integrity.

Question: What is Multiple representation?

A. Multiple representation refers to any situation where two or more clients in a real estate transaction are represented by a single brokerage. Possible scenarios include a single broker or salesperson representing both the buyer and seller; different salespersons or brokers employed by the same brokerage representing both the buyer and seller; or a registrant representing multiple buyers in the same transaction.

ontario real estate forms explained

Standard Forms explained in plain language

The commonly-used real estate forms available for download below offer clause-by-clause plain language explanations of the legal terminology used throughout them. Understanding what you are signing is essential to having a successful transaction.