administrative penalties
Administrative Penalties Case Summaries

Administrative Penalties (December 21 – February 17, 2022)

Real Estate Act s.17(a) & (b)

s.17(a). No person shall deal as a real estate broker unless that person holds the
appropriate authorization.
s.17(b). No person shall deal as a mortgage broker unless that person holds the
appropriate authorization.

1. John Doe

Not licensed

• Instance 1 – $25,000
• Instance 2 – $25,000
• Instance 3 – $25,000
• Instance 4 – $25,000
• Instance 5 – $25,000
• Instance 6 – $25,000

Total Fines: $150,000

  • On November 30, 2020, John’s license was suspended by order of the Administrator of the Real Estate Council of Alberta
  • Between April–September 2021, John represented multiple buyers with their purchase of a property and assisted clients in obtaining a mortgage
  • Activities performed in relation to this transaction were:
    • Showing clients properties for sale
    • Negotiating the terms of a contract
    • Communicating with the builder’s representative that was selling the property on behalf of the client
    • Providing advice to the clients in relation to the transaction
    • Sending these clients DocuSign transaction documents and directing them to sign them
    • Sending No Fee Fiduciary Agreements to multiple clients in order to enter into a client relationship for the purpose of obtaining a mortgage for the clients
  • John attended a property and identified themselves as a licensee who was authorized to trade in real estate and deal in mortgages
  • While providing these services to multiple buyers, documentation where it appeared a different individual (a licensed associate) was representing the buyers and not John
  • At no time did John inform the clients that their real estate and mortgage licenses had been suspended.

Learning Opportunity:

Unlicensed persons who provide services that require a license put consumers at serious risk. Unlicensed persons do not have the required education or errors and omissions insurance. Consumers working with unlicensed persons do not receive protection under the Real Estate Assurance Fund. In this case, Singh represented themselves multiple times to multiple clients that they were authorized to trade in real estate. Singh provided multiple services while their license was suspended.

Real Estate Act Rules s.38(4)

A person who is required to answer the questions of an investigator
must cooperate.

1. John Doe & John Doe

Members of the Public

  • On November 12, 2021, John and John were contacted by a RECA investigator via email to discuss an ongoing investigation
  • On November 16, 2021, John and John responded to this email stating that they would respond to questions provided via email
  • On November 16, 2021, the investigator informed John and John that a recorded, in-person interview was necessary, so that John and John could speak to specific documents and allow the investigator sufficient opportunity to explore any information provided
  • John and John did not respond to this email or contact the investigator
  • On December 2, 2021, the investigator sent John and John a Demand Letter via email and the postal service requesting they present themselves for an interview on provided dates
  • On December 7, 2021, John and John responded to this email stating they would not attend RECA offices to be interviewed and refused to answer any questions by the investigator
  • On December 7, 2021, the investigator emailed John and John advising that refusal to cooperate could lead to the Registrar issuing an administrative penalty
  • On December 8, 2021, John and John responded to this email stating they would only answer questions via email and would not present themselves at RECA offices to be interviewed
  • $5,000

2. John Doe

Members of the Public

  • On December 2, 2021, a RECA investigator contacted John and John by the phone regarding an investigation
  • John and John indicated they would attend RECA offices for an interview and provided their email address
  • On December 2, 2021, the investigator sent an email to the email address provided asking John and John to provide a date and time that was convenient for them to attend RECA’s offices for an interview
  • John and John did not respond to the email
  • On December 8, 2021, the investigator sent another email requesting John and John provide an answer to the December 2, 2021 email
  • Again, John and John failed to respond to the email
  • On December 9, 2021, the investigator sent a Demand for Information Relevant to an Investigation under the Real Estate Act via email and the postal service
  • This Demand requested John and John select a date to appear for an interview and had a due date of December 14, 2021
  • John and John were also provided a copy of the legislation supporting the Demand
  • On January 2, 2022, John and John collected and signed for this demand from a Canada Post Office
  • On January 11, 2022, John and John sent an email to the Investigator indicating they would not cooperate with the investigation
  • $5,000

Learning Opportunity:

Individuals are required by the Real Estate Act to cooperate with an investigation. Cooperation means providing truthful and complete responses in a timely and constructive manner. In these cases, the individuals failed to cooperate with an investigator to meet to answer questions regarding an open investigation. Multiple requests to meet were sent to the individuals. The individuals continually failed to respond to these requests. This was a failure to cooperate with the investigator.

Real Estate Act Rules s.41(d)

A real estate licensee must fulfill their fiduciary obligations to their client.

1. John Doe

Real estate associate registered at the time of conduct with 1601407 Alberta Ltd. o/a Re/Max Complete Realty. Currently registered with Bryken Investments Ltd. o/a Re/ Max Complete Realty.

  • On August 7, 2019, John entered into an Exclusive Seller Representation Agreement with clients for the sale of their home
  • On August 9, 2019, John left the country for approximately 11 days
  • John had a fiduciary obligation to ensure their clients’ interests were protected in their absence
  • John failed to make appropriate arrangements or follow their brokerage policy of appointing another licensee in the brokerage during their absence
  • John verbally informed their seller clients that another agent would be assisting them to ensure no showing opportunities were missed
  • The licensee referred by John was registered with a different brokerage and was not an appropriate point of contact on their behalf
  • The sellers and buyer entered a purchase contract
  • On August 14, 2019, John sent their clients a copy of a blank amendment to the purchase contract for them to sign
  • The amendment was to change the buyer’s name on the purchase contract, however that portion was left blank
  • On September 23, 2019, this transaction collapsed
  • $3,000

Learning Opportunity:

Licensees must always fulfill their fiduciary obligations to their clients. In this case, the licensee should have made appropriate arrangements of appointing another licensee at their brokerage during their absence. The licensee appointed was not part of the same brokerage and was not a suitable representative. In addition, having clients sign blank documents is not in their best interest and does not fulfill a licensees’ fiduciary obligation to them.

Real Estate Act Rules s.53(a)

A real estate associate or associate broker must only trade in real estate
in the name that appears on their license, and in the name of the
brokerage to which they are registered.

1. Jane Doe

Real estate associate broker registered with Mountain View Real Estate Inc. o/a Re/Max Real Estate (Mountain View)

  • On August 17, 2020, a Residential Tenancy Agreement was completed in Jane’s company Jane Real Estate Inc, listing them as the landlord for a property
  • Jane was not the owner of the property
  • Jane’s responsibilities included signing leases, which is a service that requires a license
  • Jane was registered with Re/Max Real Estate (Mountain View) during this time
  • Jane was trading in real estate in a name other than their registered brokerage name
  • $1,500

Learning Opportunity:

Licensees must trade under the brokerage that appears on their license. In this case, the licensee listed their own branded company name and not their brokerage name. Listing their own company name can lead to confusion for consumers about who is representing them.

Real Estate Act Rules s.91(4)

A real estate brokerage’s accounting must be filed with RECA no later
than 3 months after the brokerage’s fiscal year end.

1. John Doe

Real estate broker registered with RAI Realty Ltd. o/a Bluepoint Realtors

  • John’s brokerage fiscal year end was June 30, 2021
  • RECA sent numerous reminder emails to John’s brokerage email address and their personal email address reminding them that the required accounting forms must be filed by September 30, 2021
  • Each email reminder gave clear instructions on what forms were required, a link to RECA’s website that explained how to access the forms, and a warning that failure to complete the required forms by September 30, 2021, could result in an administrative penalty
  • RECA received the forms on October 18, 2021
  • $1,500

Learning Opportunity:

Brokerages provide accounting reports to RECA to ensure trust funds are being properly administered to protect the public and the integrity of the industry. A brokerage must file its accounting with RECA no later than three months after the end of the brokerage’s fiscal year. In this case, the broker failed to file the forms by the deadline despite RECA sending numerous reminders.

Real Estate Act Rules s.41(b)

A real estate licensee must provide competent service.

1. John Doe

Real estate broker registered with RAI RealtReal estate associate registered with Elite Ownership Group Ltd. o/a Re/Max Elite

  • John was representing buyers interested in viewing a property
  • The seller of the property required anyone viewing the property to wear a mask
  • This requirement for showing the property was on the Feature Sheet and stated masks were to be worn inside the property
  • On September 23, 2021, John had permission to bring their potential buyers to view the property
  • John and the buyers failed to wear masks for the duration of the showing
  • $1,500

2. Jane Doe

Real estate associate registered with Real Estate Professionals Inc.

  • Jane represented buyers interested in viewing a property
  • The protocols for showing the property were listed on ShowingTime notes, which stated masks were to be worn and only two adults plus the agent were allowed in the property at one time
  • The property also had a sign stating that face coverings were required in the house
  • On August 14, 2021, John had permission to bring their potential buyers to view the property
  • Jane and the buyers failed to wear masks for the duration of the showing
  • $1,500

3. John Doe

Real estate associate registered with eXp Realty of Canada Inc. o/a eXp Realty

  • John was representing buyers interested in viewing a property
  • There were several conditions put in place on viewing this property, including a maximum of two adults with their real estate representative in the property at a time
  • These conditions were put in a form and anyone accessing the property had to sign this form acknowledging the conditions
  • John signed and initialed the form in several places
  • On October 7, 2021, John had permission to bring their potential buyers to view the property
  • John’s two clients also brought an extra person
  • John allowed the extra person to enter the property
  • This extra person had not signed the required form prior to entering the property and this extra person exceeded the allowable number of people in the property
  • $1,500

Learning Opportunity:

Licensees must exercise reasonable care and skill when a property is under their care and control. They must obey the instructions of the seller and their brokerage when showing a property. Property owners must have confidence their instructions will be followed, and brokerages expect licensees to follow their guidelines. This is especially important during the COVID-19 pandemic which presents additional risk when individuals enter a property. Licensees are encouraged to use the COVID-19 property access checklists and agree to the conditions for access, in writing.

Real Estate Act Rules s.40

Licensees must immediately notify the Registrar of certain prescribed
events, in writing.

1. Jane Doe

Real estate associate rReal estate associate registered with Polaris Realty (1995) LTD. o/a Maxwell Polaris

  • Jane failed to immediately notify the registrar of a prescribed event, in writing
  • $1,000

Learning Opportunity:

Licensees must immediately notify the registrar in writing, when certain events occur (name change, discipline, criminal proceedings, etc.). In this case, the licensee had a situation requiring notification occur before they notified RECA. Immediately is defined as “without delay,” and in the absence of extraordinary circumstances, written notification to the Registrar should occur not more than five (5) days after the event in question.

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