Humber Real Estate - Course 2, Module
1, EXAM QUESTIONS AND AND
ANSWERS
Under Ontario law, how is an 'agency relationship' defined? - ANSWER>>The
relationship between two parties in which one party (the agent) accepts
responsibility for representing the other party (the principal) in dealing with a
third party.
While common law uses the terms 'Principal' and 'Third Party', what terms does
REBBA use instead? - ANSWER>>Client & Customer
The underlying relationship of the brokerage, salesperson, seller and buyer is
based on what? - ANSWER>>The Common Law of Agency
In relation to a contract, how is a third party defined? - ANSWER>>Someone
who is not directly connected with a legal transaction but may be affected by it,
OR supporting one of the people involved, i.e. lawyer, home inspector, etc.
Under REBBA, what is the equivalent for the legislative term for "agency"? -
ANSWER>>Representation
In a real estate transaction, who is the 'Agent'? - ANSWER>>The brokerage
In a real estate transaction, who is usually the 'Principal'? - ANSWER>>A seller
or buyer
Agency is also known as ... - ANSWER>>Representation
A Listing (Seller Agency) Agreement / Buyer Agency Agreement is also known as
... - ANSWER>>Representation Agreement
,Agreement of Purchase and Sale is also know as ... - ANSWER>>Agreement
(Conveyance of Interest in Real Estate)
Dual Agency is also known as ... - ANSWER>>Multiple Representation
Present Offer is also known as ... - ANSWER>>Convey Offer
Purchase / Sale by Registrant - ANSWER>>Acquisition / Divestiture by Registrant
Who are the 'Parties' to a real estate transaction? - ANSWER>>The seller and
buyer
What type of relationship does a salesperson have with their brokerage from a
legal perspective? - ANSWER>>Employee / Employer relationship with
authorization to trade on behalf of their respective brokerages.
Once an agency relationship is established between a brokerage and a client,
does the agreement apply to all brokers & salespersons employed by the
brokerage? - ANSWER>>Yes. Everyone must protect the client's best interests.
Define 'Brokerage' according to REBBA - ANSWER>>The agent who is authorized
to trade in real estate on behalf of others.
Principal is also known as ... - ANSWER>>Client
What is a 'Principal'? - ANSWER>>Someone who authorizes an agent to act on
their behalf in an agency relationship, and provides information and lawful
instructions to the agent regarding the transaction.
When a brokerage represents a seller when listing a property, who is the
'Principal'? - ANSWER>>The seller
, When a brokerage represents a buyer when showing properties for sale, who is
the 'Principal'? - ANSWER>>The buyer
What is the comparable term to 'Third Party' under REBBA? -
ANSWER>>Customer
A brokerage representing only a seller would consider a buyer as a _________ or
a customer? - ANSWER>>Third Party
What does 'Fiduciary' refer to in relation to a Representation Agreement? -
ANSWER>>A relationship of trust with one or more parties.
An agent (brokerage) as a __________ has the legal obligation to act in the
principal's (seller's or buyer's) best interests. - ANSWER>>Fiduciary
In a 'Fiduciary' relationship, what are the agent's obligations to the principal
(aka Client)? - ANSWER>>- Full disclosure (of all facts known)
- Obedience (obey the lawful instructions of the principal)
- Confidentiality (all info that is confidential will not be disclosed)
- Competence (provide all services competently)
- Accounting (responsible handling of all documents and funds related to the
transaction)
Define 'Authority' in legal terms - ANSWER>>The legal power or right given by a
principal, and accepted by the agent, to act on the principal's behalf in business
transactions with a third party, and is typically analyzed in terms of actual and
implied authorities.
What is an example of 'Actual Authority'? - ANSWER>>A seller gives the
brokerage authority to offer their property for sale.
What is an example of 'Implied Authority'? - ANSWER>>The brokerage will
determine the best marketing methods to offer the property for sale (not
1, EXAM QUESTIONS AND AND
ANSWERS
Under Ontario law, how is an 'agency relationship' defined? - ANSWER>>The
relationship between two parties in which one party (the agent) accepts
responsibility for representing the other party (the principal) in dealing with a
third party.
While common law uses the terms 'Principal' and 'Third Party', what terms does
REBBA use instead? - ANSWER>>Client & Customer
The underlying relationship of the brokerage, salesperson, seller and buyer is
based on what? - ANSWER>>The Common Law of Agency
In relation to a contract, how is a third party defined? - ANSWER>>Someone
who is not directly connected with a legal transaction but may be affected by it,
OR supporting one of the people involved, i.e. lawyer, home inspector, etc.
Under REBBA, what is the equivalent for the legislative term for "agency"? -
ANSWER>>Representation
In a real estate transaction, who is the 'Agent'? - ANSWER>>The brokerage
In a real estate transaction, who is usually the 'Principal'? - ANSWER>>A seller
or buyer
Agency is also known as ... - ANSWER>>Representation
A Listing (Seller Agency) Agreement / Buyer Agency Agreement is also known as
... - ANSWER>>Representation Agreement
,Agreement of Purchase and Sale is also know as ... - ANSWER>>Agreement
(Conveyance of Interest in Real Estate)
Dual Agency is also known as ... - ANSWER>>Multiple Representation
Present Offer is also known as ... - ANSWER>>Convey Offer
Purchase / Sale by Registrant - ANSWER>>Acquisition / Divestiture by Registrant
Who are the 'Parties' to a real estate transaction? - ANSWER>>The seller and
buyer
What type of relationship does a salesperson have with their brokerage from a
legal perspective? - ANSWER>>Employee / Employer relationship with
authorization to trade on behalf of their respective brokerages.
Once an agency relationship is established between a brokerage and a client,
does the agreement apply to all brokers & salespersons employed by the
brokerage? - ANSWER>>Yes. Everyone must protect the client's best interests.
Define 'Brokerage' according to REBBA - ANSWER>>The agent who is authorized
to trade in real estate on behalf of others.
Principal is also known as ... - ANSWER>>Client
What is a 'Principal'? - ANSWER>>Someone who authorizes an agent to act on
their behalf in an agency relationship, and provides information and lawful
instructions to the agent regarding the transaction.
When a brokerage represents a seller when listing a property, who is the
'Principal'? - ANSWER>>The seller
, When a brokerage represents a buyer when showing properties for sale, who is
the 'Principal'? - ANSWER>>The buyer
What is the comparable term to 'Third Party' under REBBA? -
ANSWER>>Customer
A brokerage representing only a seller would consider a buyer as a _________ or
a customer? - ANSWER>>Third Party
What does 'Fiduciary' refer to in relation to a Representation Agreement? -
ANSWER>>A relationship of trust with one or more parties.
An agent (brokerage) as a __________ has the legal obligation to act in the
principal's (seller's or buyer's) best interests. - ANSWER>>Fiduciary
In a 'Fiduciary' relationship, what are the agent's obligations to the principal
(aka Client)? - ANSWER>>- Full disclosure (of all facts known)
- Obedience (obey the lawful instructions of the principal)
- Confidentiality (all info that is confidential will not be disclosed)
- Competence (provide all services competently)
- Accounting (responsible handling of all documents and funds related to the
transaction)
Define 'Authority' in legal terms - ANSWER>>The legal power or right given by a
principal, and accepted by the agent, to act on the principal's behalf in business
transactions with a third party, and is typically analyzed in terms of actual and
implied authorities.
What is an example of 'Actual Authority'? - ANSWER>>A seller gives the
brokerage authority to offer their property for sale.
What is an example of 'Implied Authority'? - ANSWER>>The brokerage will
determine the best marketing methods to offer the property for sale (not
