Humber/Ontario Real Estate Course 3 Exam Practice

In which scenario is no remuneration owed to ABC Realty Inc.?

1. When the sale occurred after the holdover period expired.

2. When another brokerage found the buyer but ABC Realty Inc. was still actively marketing the property.

3. When ABC Realty Inc. introduced the buyer before their listing agreement expired.

4. When the seller decides to perform the sale individually.

5. When the buyer backed out immediately after signing the offer.

6. When the seller changed listing agreements without informing ABC Realty Inc.

The correct answer is: When the sale occurred after the holdover period expired.

Remuneration is owed to a real estate brokerage typically based on the terms outlined in the listing agreement and any relevant clauses regarding the holdover period. In the case where the sale occurred after the holdover period expired, ABC Realty Inc. is not entitled to any remuneration because the contractual relationship that asserted their entitlement to commission has come to an end. The holdover period is a defined timeframe during which a brokerage may still claim a commission for a sale, even if the formal listing agreement has expired, provided they introduced the buyer during the agreement's duration. Once this period lapses, if a transaction is finalized with a buyer who was not introduced or negotiated during the active listing, the brokerage no longer has any claim for compensation. This scenario is essential for real estate professionals to understand, as it emphasizes the importance of timing and contractual obligations in determining commission entitlements.