John William Wade – Hearing Panel Decision

• No person shall (b) trade in real estate as a real estate broker unless that person holds the appropriate licence for that purpose issued by the Real Estate Council of Alberta.

• Industry members must:
(d) fulfill their fiduciary obligations to their clients

• Industry members must:
(e) ensure the role of the industry member is clearly understood by their clients and third parties

• Wade was representing two buyer clients interested in a property with the option to have a functioning basement suite to either rent or live
• On April 1, 2014, Wade and the clients signed off on a purchase contract that contained an Addendum, drafted by Wade, that required the Sellers to make improvements to the basement of the property and anticipated a holdback for work not completed to the Buyers’ satisfaction
• The Sellers received and accepted the offer with the Addendum
• On April 3, 2014, Wade and the Buyers attended the property with a property inspector who identified a concern with a retaining wall
• Following the inspection, the Re/Max Real Estate (Central) broker became aware of the transaction
• The broker expressed concerned over the wording of the Addendum
• Believing it was an attempt to participate in mortgage fraud, the broker terminated Wade’s registration with the brokerage
• Wade didn’t tell the Buyers that his registration and employment with the brokerage had been terminated, the purchase contract was nullified and that the brokerage terminated their representation relationship.
• No representative from Re/Max Real Estate (Central) contacted the Buyers following the termination
• Between April 3 to 9, 2014, Wade was not authorized to trade in real estate
• Between April 3 to 9, 2014, Wade spoke to Sellers’ agent about the failed deal, and expressed his opinion that the contract was still legally binding
• The Sellers’ agent informed the Sellers about the termination of the purchase contract and continued to market the property
• Between April 3 to 7, 2014, the Buyers arranged for a structural engineer to attend the property to assess the issue with the retaining wall
• On or about April 7, 2014, the Buyers contacted Wade about the issues with the retaining wall
• Wade then advised the Buyers that he agreed with their decision to not continue with the deal
• Wade did not advise his Buyer clients that he was no longer employed with the brokerage, nor that there was no longer a representation relationship between them
• On April 10, 2014, Wade registered with 1601407 Alberta Ltd. o/a Re/Max Complete Realty and did not inform the Buyers of this fact, despite signing new relationship documents and a purchase contract with they buyers.

• Wade breached s.17(a) of the Real Estate Act by trading in real estate while unauthorized
• Wade breached obligations under s.41(e) of the Real Estate Act Rules by:
  • Failing to disclose his unlicensed status when communicating with the Buyers after the brokerage terminated Wade’s employment
  • Failing to ensure the Buyers understood when Wade was registered with a different brokerage
• Wade breached obligations under s.41(d) of the Real Estate Act Rules by:
  • Failing to advise the Buyers that Wade was no longer licensed to represent their interests
  • Asking the Buyers to sign an Exclusive Buyers Representation Agreement with Re/ Max Complete without advising them that it was with a different brokerage and they still had a similar agreement with an overlapping term with Re/Max Real Estate (Central)

• Fines in the amount of $5,000 for the breach of s.17(a) of the Real Estate Act
• Fines in the amount of $1,500 for the breach of s.41(d) of the Real Estate Act Rules
• Fines in the amount of $500 for the breach of s.41(e) of the Real Estate Act Rules
• Costs in the amount of $2,500