Conflicts of Interest

Question 1

Conflict of Interest

Answer 1

Conflict of Interest

Question 2

What is a conflict of interest?

Answer 2

Occurs when there is substantial risk that an agent’s representation of a client would be negatively affected by the agent’s own interest or by the agents duties to another current client, a former client, or a third party

Question 3

How to address a conflict of interest

Answer 3

Your first obligation must always be to avoid the conflict

When not possible, you must disclose the conflict, consult with your client, and explain all the option available to the along with the benefit or risks involved with each option

Question 4

Actual vs perceived conflicts of interest

Answer 4

Actual vs perceived conflicts of interest

Question 5

Conflicts can be either

Answer 5

Actual or perceived

Question 6

An actual conflict

Answer 6

Is a conflict that objectively exists and can be recognized by all parties

Question 7

Perceived conflict

Answer 7

Is one that may or may not be a conflict but appears to be one in the mind of a client

Question 8

What if you do not see a conflict

Answer 8

If you think it is possible that your client may view it differently, you will follow the same disclose requirements as you would for an actual conflict

This will reduce the risk of a complaint bein filed by an unhappy client

Question 9

Willfully ignoring conflicts of interest or failing to spot a conflict of interest can result in

Answer 9

discipline and or court action

Question 10

Your obligations to avoid conflicts of interest

Answer 10

Your obligations to avoid conflicts of interest

Question 11

Personal conflicts of interest

Answer 11

Personal conflicts of interest

Question 12

When must Personal conflicts of interest be addressed?

Answer 12

Must be disclosed immediately to your client

Question 13

If you become interested in a property you have listed

Answer 13

You are not able to be impartial or objective, nor are you able to meet another obligation of a licensee: act in the nest interest of your client

Question 14

If you proceed and represent in a transaction of a property you intend tp purchase

Answer 14

You must notify your managing broker of your intentions and get their approval before proceeding.

You must also provide the appropriate Disclosure of Interest in Trade form to the other party in the transaction before any offer is accepted

Question 15

Selling your own property

Answer 15

You should always seek advise and permission of your managing broker first if you choose to sell your home through the brokerage

Question 16

If you decide to sell your own personal home

Answer 16

The errors and omissions insurance will not cover the transaction

Question 17

Representing a spouse

Answer 17

Be careful, ensure you are not the agent on the other side of the sale

Question 18

Personal Loans

Answer 18

Both loaning money to clients and accepting loans from clients can create unintended risks and conflicts

Question 19

Loans can create a conflict in the agency relationship regardless of the circumstances

Answer 19

Such as when there is a payment default

Potential conflicts could be created if you accept a personal loan from your client

Question 20

Loans should never

Answer 20

be made between a client and their licensee.

Both you and your client should always seek external lenders to provide financial assistance

Question 21

Conflicts with Other Employment

Answer 21

Conflicts with Other Employment

Question 22

If you are licensed for trading services,

Answer 22

Conflicts of interest can also arise when you are also license to provide other types of real estate services under RESA (Rental, Strata)

Question 23

Property manager conflict

Answer 23

Influencing your buyer client to purchase an investment property so that you can manage the property as a rental property manager

Question 24

Working with affiliated professions that do not require a license under RESA

Answer 24

Individuals with supplemental employment such as mortgage brokers, insurance brokers, contractors, and developers can easily find themselves in conflict of interest when acting in multiple capacities

Question 25

Conflicts of interest respecting former clients

Answer 25

Conflicts of interest respecting former clients

Question 26

Selling a property that a former client wants to purchase

Answer 26

The licensee must first advise the former client that they cannot represent him because the seller of the property is a current client

Question 27

Conflicts when Acting for Multiple Clients

Answer 27

Conflicts when Acting for Multiple Clients

Question 28

Dual agency is

Answer 28

a conflict of interest

Question 29

Options for Managing Conflict when dealing with Multiple Clients

Answer 29

Options for Managing Conflict when dealing with Multiple Clients

Question 30

You have 2 options

Answer 30

1) Stop providing trading services to both clients

2) Continue to represent just one client

Question 31

After your clients have signed the agreement (Released client a disclosure of representation in trading services) + (disclosure of risks to unrepresented parties form)

Answer 31

Give the form and acknowledge that moving forward the licensee would be dealing with them as a unrepresented party