Humber/Ontario Real Estate Course 3 Exam Practice

What action should Salesperson Goodwin of ABC Realty Inc. take if a buyer refuses to sign a buyer representation agreement, but wants Goodwin to find a suitable home?

1. An agency relationship cannot exist, as there is no formal buyer representation agreement

2. The brokerage cannot represent this buyer, as the REBBA Code of Ethics requires that a buyer representation agreement be signed by the buyer

3. The brokerage can represent the buyer client, but lacks any formal written agreement should a legal dispute arise

4. The buyer representation agreement, signed by the brokerage but unsigned by the client, does not fulfill minimum content requirements

5. Client must sign a waiver to acknowledge lack of formal agreement

6. Salesperson Goodwin must obtain verbal approval from his broker of record

The correct answer is: The brokerage can represent the buyer client, but lacks any formal written agreement should a legal dispute arise

In this scenario, the correct action for Salesperson Goodwin is option C: The brokerage can represent the buyer client, but lacks any formal written agreement should a legal dispute arise. Even though the buyer refuses to sign a buyer representation agreement, it is still possible for the brokerage to represent this buyer without a signed agreement. However, it is crucial to note that without a formal written agreement in place, there may be risks involved, especially if a legal dispute arises in the future. Options A, B, D, and E are incorrect because they suggest that an agency relationship cannot exist without a signed buyer representation agreement, which is not entirely accurate in this situation. Option F is also incorrect as verbal approval from the broker of record is not sufficient to proceed with representing the buyer without a formal written agreement.