Assignment 1 - Real Estate Trading Services, UBC Sauder

Question 1

Question 1

Which of the following statements respecting aspects of the British Columbia civil court system would be considered accurate?

A. The next step for a disappointed litigant in a small claims dispute would be to appeal the small claims court decision to the BC Court of Appeal.

B. A matter brought before the BC Court of Appeal will be settled by a decision delivered by the majority of the judges after they have listened again to all of the evidence.

C. A BC Supreme Court judge can only hear cases involving amounts over $35,000.

D. A litigant can bring their case no further than the BC Court of Appeal, unless leave to appeal to the Supreme Court of Canada is granted.

1. All of the above
2. B and C only
3. C and D only
4. D only

Answer 1

Correct Answer: 4

(A) is incorrect because appeals from the Small Claims Court are heard in the BC Supreme Court.

(B) is incorrect because evidence is not reheard at the BC Court of Appeal; only matters of law are considered.

(C) is incorrect because, while Small Claims Courts have jurisdiction to hear cases involving monetary amounts up to $35,000, the Supreme Court has jurisdiction to hear cases involving any amount, including cases for claims of $35,000 or less.

Therefore, the correct solution is Option 4: D only.

Question 2

Question 2

After buying her fourth car, Jessie decides that it is time to build a new garage. Although she is not a professional, she is handy with tools and decides to design and build the garage herself. Once the garage is built, Jessie invites her neighbour, Steve, to her house to view her new garage. Steve thinks that the garage is unsightly and demands that she tear it down. Jessie, of course, refuses. That night, Steve drives his car through the garage destroying months of hard work. Jessie successfully sues Steve and obtains an award of $80,000 for damages. Steve feels that the decision of the court is unfair and refuses to pay it. Which of the
following steps may Jessie take?

1. Jessie can send a writ of execution to Steve and then personally seize and sell enough of his property to pay the judgment.
2. Jessie can apply to have a garnishing order served on Steve’s employer, ordering the employer to pay all of his wages into the court. She can then apply to have all of the money paid out to her.
3. Jessie can register her judgment in the land title office against Steve’s title and apply to the land title registrar for a judicial sale of Steve’s property; after the payment of prior charges on title, the proceeds will go towards paying the judgment.
4. Jessie may do none of the above.

Answer 2

Correct Answer: 4

A writ of execution cannot be issued by the judgment creditor. At the request of the judgment creditor, the court issues a writ of execution to the sheriff, directing the sheriff to seize and sell enough of the debtor’s assets to pay the judgment. Where a third person owes money to the judgment debtor, the plaintiff can obtain that money by means of a garnishing order. However, the plaintiff cannot obtain all of an employee’s wages. Seventy percent of the wages are exempt from seizure. A judgment creditor
can register a judgment in the land title office against the debtor’s title, but must apply to a court (not the registrar) for a judicial sale.

Question 3

Question 3

Which of the following statements concerning disclosure statements in British Columbia is FALSE?

1. A disclosure statement must be provided by a developer to a buyer where an offer of sale or lease relates to a time share interest in a development unit.
2. A disclosure statement must indicate that the purchaser has the right to rescind the purchase agreement by serving written notice of the rescission on the developer.
3. A disclosure statement must be in the form and include the content required by the British Columbia Financial Services Authority.
4. One of the supporting documents which must accompany the disclosure statement is a certificate from a lawyer who is a member of the Law Society of British Columbia confirming that a true copy of the disclosure statement will be delivered to the prospective purchaser or lessee.

Answer 3

Correct Answer: 4

A disclosure statement must be in the form required by BCFSA but it need not contain a certificate from a lawyer. The other options are all true.

Question 4

Question 4

Elaine obtained a judgment against Jerry for $35,000. Several months have passed and Jerry continues to refuse to pay Elaine anything. Which of the following steps is open to Elaine to enforce the judgment?

A. Elaine may register the judgment as a charge on Jerry’s land; this would prevent any sale of it from completing because title to the property could not be transferred until the judgment was satisfied.

B. Elaine may apply to have a garnishing order served on Jerry’s employer, ordering the employer to pay all of Jerry’s wages into court; Elaine could then apply to have that money paid out to her.

C. Elaine may send a writ of execution to Jerry and then personally seize and sell enough of his assets to satisfy the judgment.

D. Elaine may register her judgment in the land title office and apply to the court for a judicial sale of Jerry’s property, the proceeds of which would go towards paying off the judgment, following payment of prior charges.

1. All of the above
2. A and B only
3. C and D only
4. D only

Answer 4

Correct Answer: 4

A judgment creditor may apply to court for a judicial sale of the land. Registering a judgment against land does not prevent the subsequent sale of the land; garnishment is only available against a portion of a judgment debtor’s wages; and, seizure and sales is not personally effected by a private judgment creditor, but rather through the sheriff’s office.

Question 5

Question 5

Which of the following statements is FALSE with respect to the British Columbia Financial Services Authority (BCFSA)?

1. BCFSA has the authority to develop and amend the REALTOR® Code respecting ethical standards.
2. In fulfilling its duties under the Real Estate Services Act, BCFSA may refuse to issue a license to an unqualified applicant.
3. As part of determining whether an applicant for a licence is of a “good reputation”, BCFSA requires applicants to submit an original criminal record check.
4. One of BCFSA’s powers is to impose administrative penalties on licensees who have contravened the Real Estate Services Act.

Answer 5

Correct Answer: 1

While BCFSA has the responsibility of making rules (known as the Real Estate Services Rules) that it considers necessary or advisable respecting licensing, or regulating licensees in relation to the provision of real estate services, it is the Canadian Real Estate Association that has the authority to develop and amend the REALTOR® Code.

Options (2), (3), and (4) are all true statements.

Question 6

Question 6

Which of the following statements is TRUE?

A. The provincial government has exclusive responsibility for such areas as the administration of justice within the province, criminal matters, and education.

B. The federal government has exclusive responsibility over marriage and divorce, postal services and civil rights.

C. The residual power to legislate over areas not specifically covered in the constitution is left with the municipal governments.

D. Where the common law does not provide an answer to a legal question, the courts must then refer to statute law for guidance.

1. A, B, and C only
2. A and B only
3. All of the above
4. None of the above

Answer 6

Correct Answer: 4

The federal government is responsible for criminal matters.

The provincial government is responsible for civil rights.

Municipal governments receive their power to legislate from the provincial government, and residual powers not specifically covered in the Constitution are the responsibility of the federal government.

To answer a legal question, the courts first look at any relevant
legislation. If no legislation exists, the court must then rely on case law alone

Question 7

Question 7

An examination for discovery:

1. usually takes place before the notice of civil claim is filed so that a person can ascertain whether a cause of action exists.
2. may be a major factor in the settlement of a dispute.
3. takes place before a judge, with all parties giving evidence under oath.
4. is the process under which each party is required to provide all relevant documents to the other party.

Answer 7

Correct Answer: 2

4 is incorrect because an examination for discovery is different from a discovery of documents. Discovery of documents
is the process under which each party is required to provide all relevant documents to the other party. Examination for discovery
is a “mini-trial” that takes place between the parties to the dispute and their lawyers. Each party can examine the opposite party
under oath, and the evidence is recorded by a court reporter.

Question 8

Question 8

Deepak has just obtained his representative level licence for real estate trading services. Which of the following is TRUE?

1. As part of obtaining his representative level licence, Deepak was required to have worked in the real estate sales industry for at least two years during the five years before the date of his application.
2. Deepak’s key responsibilities under the Rules include ensuring that the trust accounts and records of the brokerage are maintained in accordance with the Real Estate Services Act and the Real Estate Services Rules.
3. Key responsibilities placed on Deepak include the duty to keep his managing broker informed of the business activities he performs on behalf of the brokerage and the duty to promptly respond to any inquiry addressed to him by his managing broker.
4. Deepak is permitted to work with other licensees in a team, even if those other licensees are licensed in relation to different brokerages, but only if the managing brokers of the brokerages involved agree.

Answer 8

Correct Answer: 3

Option (1) is false because there is no experience requirement associated with obtaining a representative level licence in British
Columbia.

Option (2) is false because the obligation under the Rules to maintain appropriate trust accounts and records belongs
to managing brokers, not representative licensees (section 28 of the Rules). The key obligations of representative licensees are
contained in section 29 of the Rules, and include the duty to provide copies of all required records to their managing broker.

Option (4) is false because all licensed team members must be licensed with the same brokerage.

Question 9

Question 9

Under the Real Estate Services Act, disciplinary action against a licensee normally begins with an investigation by the British Columbia Financial Services Authority (BCFSA). Which of the following statements concerning an investigation to determine if disciplinary action should be taken against a licensee is TRUE?

A. BCFSA may conduct an investigation to determine whether a licensee may have committed professional misconduct or
conduct unbecoming a licensee.

B. BCFSA can conduct an investigation only at the request of the Superintendent of Real Estate.

C. At any time during business hours, BCFSA can inspect the records that are located on the business premises of a licensee.

D. BCFSA may only conduct an investigation if it has received a written complaint.

1. A, B, and C only
2. A and C only
3. B and D only
4. All of the above

Answer 9

Correct Answer: 2

The Real Estate Services Act permits the British Columbia Financial Services Authority (BCFSA) to conduct an investigation to determine whether a licensee has committed professional misconduct or conduct unbecoming a licensee. Such investigations can be initiated on BCFSA’s own initiative or on receipt of a complaint. For the purposes of an investigation, the Act authorizes BCFSA to inspect the records kept on the licensee’s business premises at any time during business hours.

Question 10

Question 10

Xavier has successfully sued Yolanda in the Supreme Court of British Columbia. The court has ordered Yolanda to pay court costs. Which of the following statements is FALSE?

1. Court costs are always awarded against unsuccessful litigants like Yolanda.
2. Court costs will only cover some of Xavier’s legal fees.
3. Court costs are not the same as legal fees.
4. In general, the possibility of being ordered to pay court costs helps to discourage people from bringing weak cases before the courts.

Answer 10

Correct Answer: 1

Court costs do not automatically get awarded against the losing party, but rather, are awarded at the discretion of the court and may be awarded to either party. Court costs are meant to partially reimburse the legal expenses of the party to whom they are awarded; therefore, they are not the same as legal fees. Court costs discourage people from bringing or defending weak cases before the courts.

Question 11

Question 11

Joshua wishes to operate a corner store out of the basement of his Richmond home. However, he is not sure if this would be against the law nor is he sure of who would be responsible for laws governing this situation. When Joshua questions his lawyer, she makes the following correct response.

1. The matter would be governed by a zoning bylaw created by municipal author¬ities who derive their power from the federal government.
2. The matter is governed by the law dealing with equitable rights which puts fairness above all else.
3. Joshua must deal with municipal authorities, a third level of government which derives its powers from the provincial government.
4. Joshua should go ahead with his plans as ignorance of the law is a valid defence to any legal action.

Answer 11

Correct Answer: 3

Option (1) is incorrect because the municipal governments derive their power from the provincial governments, not from the
federal government.

Option (2) is not applicable as this is a municipal matter governed by the relevant legislation.

Option (4) is incorrect and of particular importance to you as a future real estate licensee, ignorance of the law is never a defence.

Question 12

Question 12

Which of the following statements is TRUE?

1. An appeal of the British Columbia Financial Services Authority’s (BCFSA’s) decision to discipline a licensee will be heard by the Commercial Appeals Commission.
2. An appeal of BCFSA’s decision to discipline a licensee will be heard by the British Columbia Court of Appeal.
3. An appeal of BCFSA’s decision to discipline a licensee will be heard by the Financial Services Tribunal.
4. A licensee must send notice within 60 days of the decision in order to appeal a decision of BCFSA.

Answer 12

Correct Answer: 3

Under the Real Estate Services Act, decisions of BCFSA can be appealed to the Financial Services Tribunal. To appeal a decision, a party must send notice of appeal to the Tribunal within 30 days of the date of the decision.

Question 12

Question 13

Which of the following is an aim of the Real Estate Services Act?

1. The Real Estate Services Act aims to ensure that real estate licensees are reasonably competent in providing real estate services.
2. The Real Estate Services Act aims to ensure that real estate licensees are of good reputation.
3. The Real Estate Services Act aims to discipline and, where necessary, re-educate real estate licensees if they breach the provisions of the Act.
4. All of the above are aims of the Real Estate Services Act.

Answer 12

Correct Answer: 4

The overall purpose of the Act is to protect the public and this is achieved in two ways.

First, the Act ensures that people wanting
to enter the real estate profession (that is, to obtain a real estate licence) must have particular knowledge and be of good character.

Second, to ensure that the licensees remain competent, the Act provides disciplinary options to BCFSA for a licensee’s failure to live up to certain standards of performance and ethics. These options include the possibility of an order to take further education or training.

Question 13

Question 14

During which one of the stages of the trial process does the plaintiff (or their counsel) examine the opposing party under oath?

1. Pleadings
2. Discovery
3. Judgment
4. Execution

Answer 13

Correct Answer: 2

In discovery, more specifically, examination for discovery, each party is examined under oath by the opposing party (or their counsel).

Question 14

Question 15

Which of the following is TRUE with respect to the Real Estate Errors and Omissions Indemnity Plan?

1. The key purposes of the Indemnity Plan are to provide an affordable method of protecting licensees from financial loss due to errors and omissions and reduce the risk that a consumer suffering a loss as the result of a licensee’s error(s) or omission(s) will receive no compensation due to the licensee’s lack of funds.
2. The Indemnity Plan will cover a licensee’s liability up to a limit of $3 million.
3. The Indemnity Plan requires the Real Estate Errors and Omissions Insurance Corporation to obtain the consent of the licensee in order to settle a claim involving that licensee.
4. The Indemnity Plan will cover disciplinary fines imposed by BCFSA up to a limit of $2 million.

Answer 14

Correct Answer: 1

Option (2) is false because the Indemnity Plan will cover a licensee’s liability up to a limit of $2 million.

Option (3) is false because the Real Estate Errors and Omissions Insurance Corporation has the right to settle a claim without the consent of the licensee.

Option (4) is false because the Indemnity Plan does not provide coverage for any fines, sanctions, or penalties imposed on a licensee by BCFSA.

Question 15

Question 16

Where a licensee receives a deposit on account of a trade in real estate under the Real Estate Services Act and puts it into a trust account, it may be withdrawn before completion for which one of the following reasons?

1. To pay for general office expenses of the brokerage
2. To pay the money into court under section 33 of the Real Estate Services Act
3. To discharge a lien against the brokerage that has been filed by the client involved in the trade
4. To cover any expenses incurred on behalf of the brokerage’s principal

Answer 15

Correct Answer: 2

The Real Estate Services Act requires licensees to deliver to their brokerage all money held or received from, for or on behalf of a principal in relation to real estate services. This money must be promptly paid into a brokerage trust account and may only be withdrawn in certain circumstances, including if the money is withdrawn to pay into court under section 33.

Options (1), (3) and (4) are not valid reasons to withdraw trust account money before completion of a trade in real estate.

Question 16

Question 17

Which of the following transactions involving a developer of residential subdivisions located in British Columbia does NOT require a disclosure statement under the Real Estate Development Marketing Act?

1. The strata lots in a ten unit strata building located in a municipality are being sold individually.
2. Fifteen lots of 35 hectares each in a subdivision located outside a municipality are being sold individually.
3. All 5 strata lots of a development property located outside a municipality are being sold in a single transaction.
4. A bank intends to individually resell to the residential market 20 of 25 lots in a subdivision after repossessing the lots when the developer filed in bankruptcy.

Answer 16

Correct Answer: 3

The Real Estate Development Marketing Act requires a developer to prepare a disclosure statement prior to selling lots in a subdivision. A bank acquiring a bankrupt developer’s rights would also be a “developer” as defined by the Act. The regulations exempt certain transactions from the disclosure requirements including where all units in a development property are sold in a
single transaction.

Question 17

Question 18

Which of the following statements are TRUE?

A. Section 6 of the Real Estate Services Act establishes that the managing broker is responsible for the supervision of the associate brokers and representatives who are licensed in relation to their brokerage.

B. A managing broker commits professional misconduct if they fail to adequately supervise the representatives licensed to the brokerage.

C. A brokerage may be responsible for wrongdoings by its licensees in carrying out the duties of their employment.

D. A managing broker must provide to the British Columbia Financial Services Authority any information reasonably required by it in an investigation regarding a licensee.

1. A, B, and D only
2. A and C only
3. B and D only
4. All of the above

Answer 17

Correct Answer: 4

All of the options are true statements.

Question 18

Question 19

With respect to the real estate organizations in British Columbia, which of the following is FALSE?

1. The key purpose of the Real Estate Compensation Fund Corporation is to provide compensation to those who have suffered a loss in relation to money held by a licensee being misappropriated or otherwise stolen.
2. The British Columbia Real Estate Association is made up of local real estate boards which represent various geographic areas in British Columbia.
3. The Real Estate Foundation of British Columbia receives some of its funding from the interest payable on real estate brokerage trust accounts.
4. The British Columbia Real Estate Association offers a professional designation, known as the “RI” designation, to members who meet the educational and experience standards set by the Association.

Answer 18

Correct Answer: 4

It is the Real Estate Institute of British Columbia, not the British Columbia Real Estate Association, who awards the “RI” designation to members who meet the educational and experience standards set by the Institute.

Therefore, Option (4) is a false
statement and is the correct answer to this question.

Question 19

Question 20

Which of the following would NOT qualify as a real estate service that could be subject to the requirements of the Real Estate Services Act?

1. Finding real estate for a party to acquire
2. Collecting rents or security deposits for the use of real estate
3. Collecting strata fees on behalf of a strata corporation
4. All of the above could be real estate services and subject to the requirements of the Real Estate Services Act.

Answer 19

Correct Answer: 4

All of the options describe real estate services that could be subject to the requirements of the Real Estate Services Act.