Humber/Ontario Real Estate Course 3 Exam Practice

Under REBBA Code of Ethics, what must a seller representation agreement contain?

1. A confidentiality clause regarding the negotiation process.

2. A clause specifying the services provided by the brokerage.

3. A clause limiting the liability of the brokerage.

4. A clause setting a minimum bid requirement.

5. A visual marketing plan for the property.

6. A letter from the brokerage's principal.

The correct answer is: A clause specifying the services provided by the brokerage.

A seller representation agreement must contain a clause specifying the services provided by the brokerage because it is essential for defining the scope of representation and outlining what the seller can expect from the brokerage. This clarity helps ensure that both parties understand their roles and responsibilities throughout the selling process, creating a foundation for trust and transparency. While other elements such as confidentiality or liability clauses can be important in various contexts, they are not mandated as required components of the seller representation agreement under the REBBA Code of Ethics. Additionally, establishing minimum bid requirements or including a visual marketing plan, while potentially useful, does not fall under the necessary stipulations of such agreements. A letter from the brokerage's principal, although it may serve administrative or formal purposes, is not a requisite element defined by the REBBA. Thus, the focus on what services the brokerage will provide is critical, as it establishes the expectations and obligations that govern the agent-seller relationship.