Section 18 Disclosure of Interest under the Code of Ethics (Ontario)

By
Commercial Real Estate Agent with RE/MAX West Realty Inc., Brokerage (Toronto)

Section 18 Disclosure of Interest under the Code of Ethics

This section for some reason is always under debate. This is the section:

Disclosure of interest

18. (1) A registrant shall, at the earliest practicable opportunity and before any offer is made in respect of the acquisition or disposition of an interest in real estate, disclose in writing the following matters to every client represented by the registrant in respect of the acquisition or disposition:

1. Any property interest that the registrant has in the real estate.

2. Any property interest that a person related to the registrant has in the real estate, if the registrant knows or ought to know of the interest.  O. Reg. 580/05, s. 18 (1).

(2) A brokerage shall, at the earliest practicable opportunity and before any offer is made in respect of the acquisition or disposition of an interest in real estate, disclose in writing the matters referred to in paragraphs 1 and 2 of subsection (1) to every customer with whom the brokerage has entered into an agreement in respect of the acquisition or disposition.  O. Reg. 580/05, s. 18 (2).

So, Bill a Buyer’s agent acts for Bob and Mary independently. They both wish to purchase Sam’s property.

In terms of disclosure, if there’s a “related party” matter, for example, Bill is Mary’s brother, who does Bill tell:

1)    Sam?

2)    Bob?

First, Sam really couldn’t care less. Bob is the only person who needs to know. That’s because Bill could favour his sister, Mary in the deal.

Bob’s status as a Client (agency) or Customer (non-agency) doesn’t matter. So, client is covered under s.18 (1) and customer is covered under s.18 (2).

But, everyone wants to fill out a Form and hand it over to Sam who couldn’t care less. Have another look at the section. Nowhere does it say that Bill has to inform “the other side” in the deal.

Brian Madigan LL.B., Broker

www.iSourceRealEstate.com

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