Holiday Closure

The OREA office will close for the holidays at 12 p.m. Tuesday, December 24th.  Normal business hours will resume on Thursday, January 2nd.  Happy Holidays!

Holiday Closure

The OREA office will close for the holidays at 12 p.m. Tuesday, December 24th.  Normal business hours will resume on Thursday, January 2nd.  Happy Holidays!

November 13th - 2009

Communication issues spur changes to OREA Standard Forms

Well-written standard forms and clauses help to make the trade in real estate an open and transparent process.

Well-written standard forms and clauses help to make the trade in real estate an open and transparent process. With issues of disclosure and notice top of mind, OREA offers four new forms and has made substantive changes to several existing forms.

One of the most widely used forms, the Agreement of Purchase and Sale – Form 100, has been revised for 2010. The guidelines for the giving and receiving notices, particularly in a multiple representation situation, needed clarification. The form now says “Where a Brokerage represents both the Seller and the Buyer (multiple representation), the Brokerage shall not be entitled or authorized to be agent for either the Buyer or the Seller for the purpose of giving and receiving notices.”

In addition, all references to delivery of notices, waivers, etc. in the standard OREA clauses include the words “notice in writing delivered to the ­­­­________ personally or in accordance with any other provisions for the delivery of notice in the Agreement or any Schedule thereto….”

There are three additional revisions to Form 100 for clarification. The words “(Title Insurance)” were added to Clause 10; additional wording was added to the Property Assessment clause (Clause 19); and a modified version of the Legal, Accounting and Environmental Advice clause in the commercial agreement was added (Clause 24).

To help members comply with the Code of Ethics under REBBA 2002 regarding disclosure of benefits or payments, OREA has created Form 610 –Disclosure of Benefit/Payment to Registrant. The form can be used to disclose finder’s fees, incentives, points or other benefits. In addition to describing the type of benefit, the form also provides for the seller/buyer to give consent for the Registrant to receive and retain the benefit. The REBBA Code of Ethics also requires registrants to disclose the receipt of commission payments from more than one party to the transaction. Adding the word “Payment” in the title indicates that the form can be used for this purpose.

OREA has created a separate Amendment to Agreement to Lease. Before these changes, Form 120 –Agreement of Purchase and Sale included a reference to Agreements to Lease within the form and was designed to be used to amend either a sale or a lease agreement. OREA felt that there should be a separate amendment for each of the agreements resulting in the creation of the new Form 405- Amendment to Agreement to Lease – Residential as well as two additional Commercial forms: Form 513 – Amendment to Agreement to Lease – Commercial and Form 517 – Amendment to Agreement to Sub-Lease – Commercial.

It’s important to note that the Amendment to Agreement of Purchase and Sale – Form 120 will no longer be used for lease agreements and the references to “lease” were removed.

Changes were made to the existing Form 120 in the “Delete” and “Insert” sections to deal with the issue of lack of space. The Irrevocability clause has been moved to page two of the form to allow more space for the “Insert” section on page one. In addition, WEBForms™ will now include two versions of the form in the program; the two-page version and an expanded three-page version.

Forms kept in sync
To provide consistency between the forms, some of the changes had to be incorporated into the representation agreements and customer service agreements. For example, the Finder’s Fee clause in these forms now reflects the new terminology used in the new Form 610 – Disclosure of Benefit/Payment to Registrant. In addition, the caution against the Brokerage giving and receiving notices in a multiple representation situation (now added to Clause 3 in Form 100) has been included in the representation agreements.

In addition to creating the new forms and revising the existing forms, the Standard Forms Committee also added a number of new clauses to the OREA bank of Standard Clauses. These clauses deal with the topics of windmills, vermiculite and fixtures/chattels. These revised forms and clauses will be available for use in November on the OREA website. To view them visit the Members Only section of www.orea.com, under “OREA Standard Forms.” WEBForms™ and other licensed software programs also have the updated forms available.

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For more information contact

Ontario Real Estate Association

Jean-Adrien Delicano

Senior Manager, Media Relations

JeanAdrienD@orea.com

416-445-9910 ext. 246

Ontario Real Estate Association
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