Humber/Ontario Real Estate Course 2 Exam Practice

Under which circumstance is ABC Realty Inc. entitled to a remuneration after Gallagher switched to XYZ Real Estate Limited?

1. No remuneration, because the sale occurred after the holdover period.

2. 2% of the 4% rate, since ABC Realty first introduced the buyer.

3. 1%, based on the terms of the initial listing agreement and deduction of XYZ’s rate.

4. 5%, as per the initial listing agreement’s terms without any deductions.

5. No remuneration, since ABC Realty was not directly involved in the final transaction.

6. 3%, considering both brokerages were involved but with different terms.

The correct answer is: 1%, based on the terms of the initial listing agreement and deduction of XYZ’s rate.

In this scenario, the correct answer is C. This is because the situation aligns with the terms specified in the initial listing agreement. The agreement likely states that if Gallagher switches to another brokerage, ABC Realty Inc. is entitled to a certain percentage of the commission. In this case, the agreement indicates that ABC Realty Inc. should receive 1% based on the terms of the listing agreement after deducting XYZ's rate. Option A is incorrect because the fact that the sale occurred after the holdover period does not determine ABC Realty Inc.'s entitlement to remuneration in this case. Option B is incorrect since the 2% of the 4% rate does not align with the terms of the initial listing agreement. Option D is incorrect as there is no mention that ABC Realty Inc. is entitled to 5% as per the initial agreement, without any deductions. Option E is incorrect because ABC Realty Inc. is entitled to remuneration based on the terms of the initial listing agreement. Finally, option F is incorrect as the terms of the initial listing agreement specify that ABC Realty Inc. should receive 1% in this situation.