Humber/Ontario Real Estate Course 2 Exam Practice

If a seller defaults on a transaction close and remuneration is specified in the listing agreement, what happens?

1. No remuneration is due, as the sale was not completed

2. No remuneration is due, as the seller gave notice within a 10-day period

3. Remuneration is due since both parties signed a Confirmation of Co-operation and Representation

4. Remuneration is due as specified in the agreement for seller default or neglect

5. Remuneration is partially due according to the agreement terms

6. The seller must renegotiate with the buyer

The correct answer is: Remuneration is due as specified in the agreement for seller default or neglect

In this scenario, if a seller defaults on a transaction close, and the remuneration is specified in the listing agreement, the correct course of action would be that remuneration is due as specified in the agreement for seller default or neglect (Option D). This means that the seller would be obligated to pay the remuneration outlined in the agreement as a consequence of their default. Option A is incorrect because even if the sale was not completed due to the seller's default, the remuneration specified in the listing agreement would still be due. Option B is incorrect as the reason for the seller's notice within a 10-day period is not relevant to the obligation of remuneration specified in the listing agreement. Option C is incorrect as the signing of a Confirmation of Co-operation and Representation does not determine the consequences of a seller default on transaction close. Option E is incorrect because the remuneration would be due according to the specific terms outlined in the agreement, not partially. Option F is also incorrect because the obligation for remuneration in the event of a seller default typically stems from the terms set out in the listing agreement and not necessarily from the need to renegotiate with the buyer.