- A licensee must communicate all offers to a client in a timely, objective and unbiased manner.
- A licensee owes honesty, reasonable care and skill to everyone, including people who are not clients.
- Concerns about a licensee's conduct can go to the superintendent in a written complaint.
A bully offer is the common name for an offer that arrives before the date a seller has set to review offers, often with pressure to decide quickly. If you are a buyer thinking of making one, or a seller who has just received one, you probably want to know what your realtor must do.
This article explains the duties that BC's real estate rules place on realtors whenever an offer comes in. The exact handling of an early offer depends on the facts, your agreement and the current rules, so confirm specifics with your realtor in writing and with a lawyer.
This article covers the law of British Columbia.
What people mean by a bully offer
"Bully offer" and "pre-emptive offer" are market terms for an offer made ahead of a set offer date, usually with a short deadline to accept. The seller then has to choose between accepting early and waiting to see what other buyers might offer.
How a particular early offer must be handled depends on the facts, the listing agreement and the rules in force. This article sticks to the general duties that apply to licensees, and a lawyer or BCFSA can confirm how they apply to your situation.
Who regulates your realtor
BCFSA is the regulator of real estate licensees under the Real Estate Services Act. Since August 1, 2021 it is the sole regulator for BC financial services including real estate, after the Office of the Superintendent of Real Estate and the Real Estate Council of B.C. integrated with it.
The Real Estate Services Rules draw the legal line between a client, who is the principal who has engaged the licensee, and an unrepresented party, who is a party to a trade who is not a client of a licensee for that trade. Your rights depend on which one you are.
What a realtor owes a seller when an offer arrives
A licensee owes a client duties that include acting in the client's best interests, keeping client information confidential, disclosing all known material information about the services, and communicating all offers in a timely, objective and unbiased manner.
When presenting an offer to a seller, the licensee must disclose the seller's payments to the listing brokerage, payments to any cooperating brokerage, amounts retained and other licensee remuneration.
Those duties can be modified only by written agreement, and even then the brokerage must still supervise its licensees and protect confidential information.
What a realtor owes a buyer making the offer
Before providing trading services, a licensee must disclose whether or not they will represent the party as a client. If the licensee represents a client, they must also tell an unrepresented party the risks of receiving assistance from the licensee and recommend the party seek independent professional advice.
Whoever you are, a licensee must act honestly and with reasonable care and skill, including toward parties who are not clients.
- A brokerage must not engage in dual agency, with limited exceptions.
- Where a licensee would otherwise act for conflicting clients in one trade, the licensee must provide trading services to none of them or represent only one, and may represent only one if all clients give written agreement.
- A conflict must be disclosed promptly and fully to the client, in writing and separately from a service agreement.
What to do next
- Ask your realtor in writing whether they represent you as a client.
- Ask how offers, including early ones, will be communicated and when.
- Read your service agreement and any written changes to the realtor's duties.
- Keep a record of every offer, message and deadline.
- If you think a licensee acted improperly, a written complaint with particulars can be made to the superintendent.
- Talk to a lawyer before accepting or making an offer with a short deadline.
Misconduct under the Act includes contravening the Act, wrongful taking or deceptive dealing, and incompetence. A complaint does not give you damages, because the Act's remedies are regulatory orders. Compensation is available only through the Special Compensation Fund, and only for compensable loss, which means money held by a licensee that was misappropriated, wrongfully converted or fraudulently obtained, and it excludes claims for remuneration.
Frequently asked questions
Does a realtor have to pass on an early offer to the seller?
A licensee must communicate all offers to a client in a timely, objective and unbiased manner. How that applies to a particular early offer depends on the facts, so confirm it with your realtor and a lawyer.
Can the seller's realtor also act for me as the buyer?
A brokerage must not engage in dual agency. There is an exception for trades in remote locations where different licensees are impracticable, with written agreements and disclosure required.
What if I am not the realtor's client?
The licensee must still act honestly and with reasonable care and skill toward you. If the licensee represents a client in the trade, they must also tell you the risks of receiving assistance from them and recommend that you seek independent professional advice.
How do I complain about how an offer was handled?
Make a written complaint to the superintendent with particulars. Unless it is anonymous, you will be told the outcome.
Sources
- Real Estate Services Act, s. 1 (BC Laws) — bclaws.gov.bc.ca
- gov.bc.ca – Office of the Superintendent of Real Estate — www2.gov.bc.ca
- Real Estate Services Rules, s. 1 — bclaws.gov.bc.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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