Obligations Owed to Clients After a Representation Relationship Ends
As per the Real Estate Act Rules, a licensee must maintain confidentiality of all information obtained during the representation relationship, even after the relationship has ended.
WHAT YOU'LL LEARN
Obligations Owed to Clients After a Representation Relationship Ends
Storing and Maintaining Documentation in Compliance with the Real Estate Act Rules
Example: Fulfilling Post-Relationship Duties with Confidentiality and Professionalism
Duty of Confidentiality:
As per the Real Estate Act Rules, a licensee must maintain confidentiality of all information obtained during the representation relationship, even after the relationship has ended.
“A licensee must not use or disclose confidential information obtained from a client except as required by law or authorized by the client.”
Return of Client Property:
Any property or documents belonging to the client must be returned promptly once the representation relationship ends, unless the client has authorized the licensee to retain them.
Fiduciary Duties After the Relationship Ends:
While general fiduciary duties may end with the relationship, obligations such as acting in good faith and handling matters related to the previous representation remain.
This includes ensuring that no harm comes to the former client due to mishandling of records or confidential information.
A licensee’s duty to maintain and store documentation related to representation relationships
Record-Keeping Requirements:
As per the Real Estate Act Rules, brokerages and licensees must retain all records related to a representation relationship for at least three years after the relationship ends.
This includes:
Representation agreements.
Financial records.
Correspondence related to the services provided.
Client instructions.
Accessibility of Records:
The Real Estate Act Rules mandates that records must be readily available for inspection by the Registrar or the Council during this three-year period.
Maintaining Integrity of Records:
Records must be maintained securely to prevent loss, unauthorized access, or tampering.
Any electronic records must comply with the same standards for security and accessibility as physical records.
Transition of Records:
If a licensee leaves a brokerage, the brokerage is responsible for retaining the records. However, the licensee must ensure a smooth transition of all documentation to the brokerage before departing.
Obligations Owed to Clients After a Representation Relationship Ends
Duty of Confidentiality:
As per the Real Estate Act Rules, a licensee must maintain confidentiality of all information obtained during the representation relationship, even after the relationship has ended.
“A licensee must not use or disclose confidential information obtained from a client except as required by law or authorized by the client.”
Return of Client Property:
Any property or documents belonging to the client must be returned promptly once the representation relationship ends, unless the client has authorized the licensee to retain them.
Fiduciary Duties After the Relationship Ends:
While general fiduciary duties may end with the relationship, obligations such as acting in good faith and handling matters related to the previous representation remain.
This includes ensuring that no harm comes to the former client due to mishandling of records or confidential information.
Storing and Maintaining Documentation in Compliance with the Real Estate Act Rules
Record-Keeping Requirements:
As per the Real Estate Act Rules, brokerages and licensees must retain all records related to a representation relationship for at least three years after the relationship ends.
This includes:
Representation agreements.
Financial records.
Correspondence related to the services provided.
Client instructions.
Accessibility of Records:
The Real Estate Act Rules mandates that records must be readily available for inspection by the Registrar or the Council during this three-year period.
Maintaining Integrity of Records:
Records must be maintained securely to prevent loss, unauthorized access, or tampering.
Any electronic records must comply with the same standards for security and accessibility as physical records.
Transition of Records:
If a licensee leaves a brokerage, the brokerage is responsible for retaining the records. However, the licensee must ensure a smooth transition of all documentation to the brokerage before departing.
Example Scenario:
Fulfilling Post-Relationship Duties with Confidentiality and Professionalism
Context: A condominium manager, Sarah, has ended her representation relationship with a condominium corporation after their one-year agreement expired.
Steps Taken by the Licensee:
Return of Client Property:
Sarah ensures all financial statements, meeting minutes, and corporation documents are returned to the condominium board. She provides a formal handover report summarizing key tasks completed during the relationship.
Legislative Reference: “A licensee must deliver to the client all property in their possession belonging to the client upon request or upon termination of the representation relationship.”
Record Storage:
Sarah retains copies of the representation agreement, communications with the board, financial records, and client instructions for three years. These records are stored securely in compliance with the Real Estate Act Rules.
Maintaining Confidentiality:
During her work with a new client, Sarah is approached by a contractor who had previously worked with the former condominium corporation. The contractor requests details about the corporation’s operations. Sarah refuses to disclose any information, citing the Real Estate Act Rules regarding confidentiality.
Professionalism in Closing Out:
Sarah sends a final email to the condominium board summarizing her key actions, confirming the return of all documents, and reminding them to contact her brokerage for any follow-up questions.
Exercise Prompt:
Sarah has ended her representation relationship with a condominium corporation. Complete the following tasks:
Identify what specific documents Sarah must retain for three years as per the Real Estate Act Rules.
Draft an email for Sarah to send to the condominium board, summarizing her post-relationship obligations and confirming the return of all client property.
Analyze Sarah’s refusal to share confidential client information with a contractor. Explain how her decision aligns with the Real Estate Act Rules.
Sample Email Template:
Subject: Confirmation of Termination of Representation Relationship
Dear [Condominium Board Name],
I hope this message finds you well. As our representation agreement concluded on [Date], I would like to confirm the completion of my post-relationship responsibilities:
All documents and property belonging to [Condominium Corporation Name], including financial records, meeting minutes, and key correspondence, have been returned to your possession. Please let me know if there is anything further required in this regard.
In compliance with the Real Estate Act Rules, a copy of the representation agreement and all related records will be securely retained by my brokerage for a period of three years.
If you require assistance in the future, feel free to contact my brokerage at [Brokerage Contact Information].
Thank you for the opportunity to work with you. I wish [Condominium Corporation Name] continued success.
Best regards,
[Licensee Name]
[Brokerage Name]
[Contact Information]
By maintaining confidentiality, securely storing records, and adhering to professional standards, licensees ensure compliance, protect client interests, and uphold the integrity of the condominium management industry.
Learners are encouraged to practice these obligations in real-world scenarios to prepare for their licensing exam and professional practice.
