Humber/Ontario Real Estate Course 2 Exam Practice

When Seller Smith signs a seller representation agreement, what authority is given to the listing brokerage?

1. The listing brokerage can receive a deposit relating to an agreement of purchase and sale.

2. The listing brokerage has an implied authority to permit other brokerages to participate in selling the property.

3. The brokerage can sign an agreement of purchase and sale on behalf of the seller.

4. The seller is responsible for remuneration for commission plus additional expenses incurred by the brokerage.

The correct answer is: The seller is responsible for remuneration for commission plus additional expenses incurred by the brokerage.

When Seller Smith signs a seller representation agreement, the authority given to the listing brokerage is primarily outlined in the agreement itself. Option D is correct because it highlights that the seller is responsible for remuneration for the commission agreed upon, as well as any additional expenses incurred by the brokerage during the process. This is a fundamental aspect of the relationship between the seller and the listing brokerage and is a standard practice in real estate transactions. Options A, B, and C are not correct because they do not accurately reflect the authority granted to the listing brokerage when the seller signs a seller representation agreement. While the brokerage may have the ability to receive a deposit (option A) and permit other brokerages to participate in selling the property (option B) based on specific terms in the agreement, the primary responsibility for commission and additional expenses falls on the seller, as stated in option D.