Humber/Ontario Real Estate Course 4 Exam Practice

Who is responsible for establishing the standard of care in real estate transactions?

1. The real estate brokerage.

2. The local housing authority.

3. The collective conduct of reasonable salespersons under similar circumstances.

4. The seller’s lawyer.

5. The home inspection company.

The correct answer is: The collective conduct of reasonable salespersons under similar circumstances.

Establishing the standard of care in real estate transactions is determined by the collective conduct of reasonable salespersons under similar circumstances. This standard is informed by the actions and practices of real estate professionals in the industry and reflects what is accepted as adequate performance within the context of real estate transactions. The standard of care accounts for the expertise, skills, and responsibilities that a reasonable salesperson would exhibit. This includes diligence in providing accurate information, disclosing relevant details, and acting in the best interests of clients. By referencing the collective conduct of salespersons, it acknowledges the importance of industry norms and expectations, which can evolve based on professional behavior and market practices. While other parties involved in the transaction, such as real estate brokerages or lawyers, have specific roles and responsibilities, the standard of care is fundamentally based on the expectations and actions of the real estate professionals themselves, thus making this choice the correct one.