Humber/Ontario Real Estate Course 4 Exam Practice

In which of the following scenarios would remuneration not be due in accordance with Ontario real estate regulations?

1. A brokerage can successfully win a legal case if a seller signs a seller representation agreement that includes a tiered remuneration plan and then refuses to pay.

2. A buyer unwittingly signs a second buyer representation agreement with a different brokerage while the first agreement is still active. No remuneration is due unless the buyer agrees otherwise.

3. Remuneration is payable when a referral leads to a transaction, and the cheque should be issued directly by the brokerage.

4. Salesperson Burrows prepares a buyer representation agreement, but the buyer never signs it. No remuneration is payable even when an acceptable offer is negotiated.

5. Salesperson Shaw receives a referral from another brokerage, concluding in a successful purchase with remuneration due for the referral.

The correct answer is: Salesperson Burrows prepares a buyer representation agreement, but the buyer never signs it. No remuneration is payable even when an acceptable offer is negotiated.

The scenario where remuneration is not due revolves around the situation where a buyer representation agreement is prepared but not signed by the buyer. In real estate regulations in Ontario, for a commission or remuneration to be owed to a salesperson, there typically needs to be a binding agreement in place between the parties involved. In this case, even if Salesperson Burrows negotiated an acceptable offer on behalf of the buyer, without the buyer's signature on the representation agreement, there is no formal agreement that obligates the buyer to pay remuneration. This adheres to the principle that remuneration is contingent upon an executed agreement that clarifies the terms of service and payment. The other choices present scenarios where remuneration either could be due or the relationship and agreements in place navigate towards a potential obligation for payment. For example, tiered remuneration plans or signature authority issues in representation agreements may require further exploration of the specific contractual obligations.