Case summaries are published in accordance with section 55 of the Real Estate Act. For full versions of the disciplinary decisions summarized below, visit www.reca.ca and click Member Information > Disciplinary Decisions. Decisions are publicized to enhance the transparency of RECA’s disciplinary process and to assure consumers that there is an effective framework in place to deal with breaches of the Real Estate Act. To obtain further information about RECA’s policies and procedures, please call 1-888-425-2754.
administrative penalties
July 2008 - October 2008.
- 1 breach of failing to report at the brokerage’s fiscal year end with regard to the operation of its accounts in which money was held in trust [s.90 of the Real Estate Act Rules]
- 1 breach of failing to file brokerage accounting within the allotted time period [s.91(4) of the Real Estate Act Rules]
- 4 breaches of failing to file a Declaration Respecting Absence of Trust Transactions within the allotted period of time [s.92(1) of the Real Estate Act Rules]
- 2 breaches of delegation of unauthorized support personnel and assistants [s.46 (2) of the Real Estate Act Rules]
- 1 breach of unauthorized activity [s.17 of the Real Estate Act]
- 1 breach of failing to notify the Executive Director of proceedings pursuant to the Criminal Code commenced against an industry member [s.40(1)(g) of the Real Estate Act Rules]
Consent agreements
August 2008
David Agema, associate broker
formerly registered with Re/Max Real Estate – Lethbridge and currently registered with Top 5 Real Estate Lethbridge Ltd. o/a Prudential Top 5 Real Estate.
Issues:
- Failure to render competent service by participating in the creation of contracts that he knew or ought to have known were not legally binding, confusing or did not reflect agreements already in place and by failing to provide all documentation or trade records required under the Real Estate Act Rules to the brokerage [s.6 of the Code, as it was then]
Facts:
- Mr. Agema acted for Mr. and Mrs. A (the Sellers) in the sale of their property.
- Mrs. A signed her husband’s name on the Listing Agreement, with her husband’s consent, as he was out of town.
- Mr. Agema witnessed the signature.
- Mr. Agema did not make inquiries about Mrs. A’s marital status or her authority to make the signature.
- The graduated commission arrangement agreed to between the parties was not clearly documented in the Listing Agreement.
- Mr. Agema received a written offer from clients of industry member, Mr. S.
- After reviewing the offer, Mrs. A advised Mr. Agema that they wanted more money.
- Mr. Agema made a verbal counteroffer to Mr. S on behalf of the Sellers.
- Mr. S accepted the counteroffer on behalf of his clients.
- In the meantime, Mrs. A received a message from industry member Mr. H that he had clients who would be making a competing offer.
- When advised about the competing offer, Mr. Agema told Mrs. A that Mr. S had accepted Mr. Agema’s verbal counteroffer.
- Mr. Agema advised Mrs. A to obtain legal advice about the competing offers.
- Mrs. A’s lawyer told Mr. Agema to obtain both offers as signed contracts and to present both to Mrs. A.
- Both offers included items excluded by the Sellers in the Listing Agreement
- According to Mrs. A, Mr. Agema did not discuss such included items with them.
- The Sellers made a counteroffer to Mr. S’s clients, which was accepted.
- There were multiple versions of purchase contracts between the Sellers and Mr. S’s clients, not all of which were turned into Mr. Agema’s brokerage.
- Because of the numerous contract copies and errors in completing same, it was necessary for the Sellers’ legal counsel to create a new purchase contract.
- Errors relating to the multiple contract copies included:
- Improper signatures
- Absence of initials for amendments
- Inaccurate times/dates
- Witness signatures obtained before party signatures
- Lack of clarity as to when clauses/conditions were inserted
- Mr. Agema reimbursed the Sellers for their losses, including legal expenses.
Results:The Hearing Panel found Mr. Agema’s conduct deserving of sanction and ordered him to pay a fine of $5,000; costs of $2,000 and complete an educational requirement.
William (Bill) Haldane, real estate appraiser
Haldane Appraisals Ltd.
Issues:
- Failure to adhere to the Canadian Uniform Standards of Professional Appraisal Practice[s.34.1(6) of the Real Estate Act]
Facts:
- In September 2004, Bill Haldane, licensed appraiser, was contacted by Mr. A of Calgary. Mr. A indicated that he was interested in purchasing units in an apartment complex in Red Deer, Alberta. He requested appraisals on about 15 units. Mr. A also gave Mr. Haldane a package of offers to purchase for the units.
- Mr. Haldane inspected the units in the last week of September.
- Second appraisals on some of the units were carried out in November, after some renovations had been done.
- Appraisal reports for the units were issued from September to November.
- In the appraisal reports, Mr. Haldane used comparables from the same building.
- He listed the offers to purchase as sales, even though they were not, and based value on these sale prices.
- Mr. Haldane did not check expired listings on the MLS system or exposure times on the market.
Results: The Hearing panel found Bill Haldane’s conduct to be deserving of sanction and ordered him to pay a fine of $5,000; costs of $1,000 and complete an educational requirement.
September 2008
Gordon Sieb, real estate broker,
626456 Alberta Ltd. o/a Diversified Management Southern, formerly a partnership o/a Diversified Management Southern.
Issues:
- Failure to disperse money received and held in trust [s.25(1)(d) of the Real Estate Act]
- Failure to fulfill a fiduciary duty to a client [ s.2(b) of the Code of Conduct, as it was then]
Facts:
- In or around November 2001, Mr. Sieb was the registered broker for a partnership operating under the trade name Diversified Management Southern (Diversified).
- On or about November 15, 2001, Diversified entered into a contract as the manager with the owners of a condominium corporation for the management of some condominium units.
- Under the contract all money collected by Diversified on behalf of the condominium corporation was to be held in trust.
- The terms of termination of the contract included a clause that within 60 days, the manager should give a final accounting to the corporation and pay any balance in the trust account to the corporation less any amounts owing on commitments made by the manager prior to termination.
- The terms also stated that within 60 days, the manger should turn over all contact, files, records and other documents or information to the condo corporation.
- On or about June 10, 2003, Mr. Sieb sent notice of termination to the condominium corporation stating the termination would occur 30 days from the notice.
- On or before June 27, 2003, the condominium corporation hired another property management company to assume the management being performed by Diversified.
- In a letter dated June 30, 2003, the manager of the new company wrote to Mr. Sieb requesting all documentation related to the condominium corporation
- On or about June 30, 2003, Diversified made a partial payment to the condominium corporation from the monies held in trust.
- On or about October 3, 2003, the new management company demanded that Diversified provide it with ‘final accounting’ documentation and balances on or before October 6, 2003.
- On or about October 6, 2003, Diversified made the management and accounting documents and a further payment available for pick up.
- The documents were received by the new company on or about October 8, 2003.
- In or around February or March 2004, Diversified received a cheque payable to the condominium corporation for a cancelled insurance contract.
- This cheque was deposited into the condominium corporation account still maintained by Diversified on or about March 8, 2004.
- As of May 31, 2004, the separate trust account maintained by Diversified for the benefit of the condominium corporation held money including the amount deposited to the account on March 8, 2004.
- In or around June 2004, Diversified withdrew the remaining amount in trust via three transactions:
- A cheque dated May 14, 2002.
- A cheque dated June 11, 2002.
- A bank draft dated June 25 was issued to the credit of the condo corporation in closing the account.
- On or about August 3, 2004, Diversified forwarded the bank draft for the remaining money to the new management corporation along with the bank statement dated June 30, 2004.
Results: The Hearing Panel found that Mr. Sieb’s conduct was deserving of sanction and ordered him to pay a fine of $2,000; costs of $700 and the broker will complete the Real Estate Brokerage Course of the Real Estate Broker’s Program.
October 2008
Robert Maskell, associate broker
Royal LePage Arteam Realty
Issues:
- Failure to ensure the role of the industry member was clear to the parties affected [s.3(a) of the Code of Conduct, as it was then]
- Failure to render competent service by participating in the creation of a contract that the member knows or ought to know is not legally binding confusing or does not reflect any agreement already in place[s.6(c) of the Code of Conduct, as it was then]
Facts:
- Mr. Maskell entered into a Residential Real Estate Listing Contract with Ms. A (the Seller) who was assisted by her son.
- When the property did not sell, Mr. Maskell and the Seller entered into another listing contract.
- Mr. and Mrs. C (the Purchasers) contacted Mr. Maskell with interest to buy Ms. A’s property.
- Mr. Maskell explained Dual Agency and the Purchasers executed an Agency Explanation and Acknowledgement form.
- Mr. Maskell wrote an Offer to Purchase (the First Offer) as instructed by the Purchasers using the standard Residential Real Estate Purchase Contract.
- A condition listed in article 8 included: ‘subject to sale of buyers’ home by January 31, 2006 with 24-hour clause.’
- There was no schedule attached explaining the 24-hour clause.
- There was no expiry date included in article 13 of the offer.
- Mr. Maskell presented the first offer verbally and the Seller’s son confirmed he would ‘sit’ on the offer.
- The Purchasers increased their offer (the Second Offer), which was presented to the Seller verbally.
- No written Offer to Purchase was prepared for the Second Offer.
- The date of the Second Offer is uncertain as there is not documentation.
- The Seller’s son once again said he would not accept nor reject the offer but ‘sit’ on it.
- The Purchasers asked Mr. Maskell to determine the Seller’s bottom line.
- Mr. Maskell asked the Seller what her bottom line would be and after receiving permission to tell the Purchasers, communicated same to them.
- The Purchasers instructed Mr. Maskell to make an offer in the amount of the “bottom line” price.
- Mr. Maskell subsequently completed another written offer on behalf of the Purchasers (the Third Offer).
- A separate Offer to Purchase was not completed. Instead, the First Offer was amended to reflect the new proposed purchase price and thus became the Third Offer.
- The date the Third Offer was signed is unclear as it was not noted on the offer.
- Prior to presenting the Third Offer, a home inspection was performed at the request of the Purchasers with the consent of the Seller.
- The inspection took place even though the Seller had not signed the Offer and no agreement was in place.
- As a result of several deficiencies, the Purchasers informed Mr. Maskell they wished to reduce their Third Offer.
- The Fourth Offer for a lesser amount was presented to the Seller verbally.
- The date it was presented is uncertain as it is was not recorded.
- Mr. Maskell then presented a counter-offer on behalf of the Seller.
- The counter-offer included the following condition: ‘subject to sale of buyers’ home by February 28 2006 with 24-hour clause.’
- There is no schedule attached explaining the 24-hour clause.
- There is no expiry date included in article 13 of the counter offer.
- The Purchasers rejected the counter-offer but there was no indication they were no longer interested in the property.
- Mr. Maskell was approached by Mr. and Mrs. D who indicated they were interested in the property.
- Mr. Maskell explained that he was acting for the Seller and explained Dual Agency.
- Mr. and Mrs. D executed the Agency Explanation and Acknowledgement Form.
- Mr. Maskell did not advise Mr. and Mrs. D that he was acting on behalf of another purchaser interested in the same property.
- Sometime thereafter, Mr. Maskell called the Purchasers to advise them that another offer was on the table.
- Mr. Maskell did not advise them that he was acting for the other interested party.
- The Purchasers instructed Mr. Maskell to make another offer, however he cannot recall for what amount (the Fifth Offer) as the offer was not reduced to writing.
- Mr. and Mrs. D eventually made an offer accepted by the Seller.
Results: The Hearing Panel found that Mr. Maskell’s conduct was deserving of sanction and ordered him to pay a fine of $3,000; costs of $500 and complete an educational requirement.
Disciplinary Action
September 2008
Giampiero Sartori, associate
former associate registered with Comox Realty Group
Issues:
- Failure to fulfill fiduciary duty to client [s.2(a), (b), (e), (m) of the Code of Conduct,as it was then]
- Conduct that is reckless or intentional and that misleads or deceives [s.4(a), (d) of the Code of Conduct, as it was then]
- Failure to render competent service [s.6(c) of the Code of Conduct, as it was then]
- Failure to enter into a guaranteed sales agreement when representations were made to pay to the seller a fixed or determined amount of money within a fixed or determined amount of time [s.20 of the Real Estate Act, as it was then]
Facts:
- At all material times hereto, Mr. Sartori was authorized as a real estate broker by the Real Estate Council of Alberta.
- Mr. Sartori was an agent for the seller of Property A.
- In marketing Property A, Mr. Sartori posted a sign which read “For Sale G. Sartori 374-1506” and included the statement “BUY THIS HOUSE and we’ll BUY YOURS FOR CASH.”
- On or about November 1, 2004, Mr. and Mrs. W (the “Ws”) saw the above sign at Property A and contacted Mr. Sartori concerning the purchase of Property A and the sale of their home, Property B, in reliance upon the representation on the sign at Property A.
- Mr. Sartori informed the Ws that his company, 1024703 Alberta Corporation, was interested in buying their property.
- Mr. Sartori led the Ws to believe that he had signing authority for 1024703 Alberta Corporation.
- 1024703 Alberta Corporation was incorporated January 3, 2003 and was closely held by three shareholders none of which were Mr. Sartori.
- Mr. Sartori was, at all material times, a director of 1097812 Alberta Inc. but not a shareholder.
- On or about November 13, 2004, Mr. Sartori provided advice and direction to the Ws in the execution and completion of both of the purchase contracts as well as other documents associated with both contracts.
- Mr. Sartori did not disclose information that was relevant to the Ws about the ability of 1024703 Alberta Corporation to qualify to assume the W’s mortgage.
- On or about November 19, 2004, Mr. Sartori prepared and obtained the signature of the Ws on a waiver of all conditions on the purchase Property A, having assured them that the sale of Property B to 1024703 Alberta Corporation would proceed.
- On or about January 13, 2005, Mr. Sartori learned that the numbered company was required to qualify for assumption of the mortgage on the W’s home.
- Mr. Sartori immediately advised the Ws the numbered company would not proceed to purchase their home but that they must proceed with the purchase of Property A or face a lawsuit by the seller of that property.
- The Ws were forced to find a last minute buyer for their home or risk breaching the unconditional contract they were in.
- The Ws lost all equity in their existing home, which was eventually sold as a mortgage assumption only.
Results: The Hearing Panel found Mr. Sartori’s conduct deserving of sanction and ordered that he pay a fine of $10,000; costs of $14,000; that he successfully complete the Real Estate Associates’ Program prior to re-licensing in Alberta; and that he may not be authorized as a broker in Alberta unless and until he has been registered as an associate with a brokerage other than any one he may have any financial ownership in for a period of 3 years.
Admission of conduct deserving of sanction (s.46)
October 2008
Michael Cain, broker
Re/Max House of Real Estate
Issues:
- Failure to keep complete and accurate financial records of money received in trust [s.25(1)(a) of the Real Estate Act Rules]
- Failure to ensure brokerage name clearly indicated in the trading of real estate [s.51(1)(c) of the Real Estate Act Rules]
- Failure to review monthly reconciliation and failure to acknowledge review [s.38(3) of the Real Estate Act Rules]
- Failure to act in the best interest of the client [s.2(a) of the Code of Conduct, as it was then]
Facts:
- In October 2005, two Calgary real estate brokerages, Re/Max House of Real Estate and Re/Max Classic, amalgamated under the Re/Max House name.
- This meant transferring all the associates to Re/Max House as well as getting amendments to all listing contracts.
- The long-time administrator of Calgary Classic was away on an extended personal leave when it was discovered in mid-October that there had been a break-in at the offices and that three computer towers were stolen.
- The brokerage attempted to resurrect files through computer back-ups.
- The administrator was assisting the computer software people over the phone.
- At the beginning of November, the administrator tendered her resignation and indicated that she was suing the brokerage.
- At the same time it was discovered that there was about $700,000 missing from the Re/Max Classic trust accounts.
- The theft was eventually traced to the administrator and the police were notified.
- A judgment was received against the administrator and about $360,000 was recovered.
- The brokerage replaced the missing trust funds from the general accounts.
- The reconstruction of the accounting information took place over several months as data, for a 60-day period, had to be entered from hard copy.
- In January 2006, as data for transactions was entered, it was discovered that there had been six NSF cheques on transactions in October.
- The money to cover the trust deficits was taken from general accounts for five of the transactions.
- In the sixth transaction, the NSF cheque was noted and corrected before monies were paid out from the trust account.
- In all but one case, the monies were eventually recovered.
- RECA had been notified of the accounting problems.
- The buyer in one NSF transaction complained to RECA regarding the conduct of the selling agent.
- In investigating this complaint the issues regarding the other NSF transactions were brought forward, resulting in this investigation.
Results: The Hearing Panel accepted Mr. Cain’s Admission of Conduct Deserving of Sanction and ordered that he pay a fine of $4,000 and costs of $1,000, with no educational requirement.
Voluntary Withdrawals from industry (s.54)
November 2008
RAHIMA ATHARI, MORTGAGE ASSOCIATE
Centum Micasa Mortgage Corp
On November 5, 2008, Rahima Athari, former mortgage associate most recently registered with Centum Micasa Mortgage Corp., applied to the Real Estate Council of Alberta (RECA) to withdraw from industry membership in accordance with section 54 of the Real Estate Act. At the time of her withdrawal application, a RECA investigation was ongoing to determine whether Ms. Athari was involved in fraudulent or unlawful activities including whether she was completing mortgage financing applications on behalf of buyers whose mortgages she or her associates later assumed.
Ms. Athari’s application to withdraw was approved by RECA and results in a voluntary lifetime prohibition from industry membership. By virtue of operation of the Real Estate Act, conduct proceedings are discontinued. Ms. Athari’s withdrawal application does not constitute an admission of misconduct.
SOHAIL IQBAL, ASSOCIATE
Impact Real Estate Group Ltd. o/a Residential One Real Estate
On November 5, 2008, Sohail Iqbal, former associate most recently registered with Impact Real Estate Group Ltd. o/a Residential One Real Estate in Calgary, applied to the Real Estate Council of Alberta (RECA) to withdraw from industry membership in accordance with section 54 of the Real Estate Act. At the time of his withdrawal application, a RECA investigation was ongoing to determine whether Mr. Iqbal was participating in the creation of false and misleading documents for the purpose of obtaining fraudulent mortgages including creating false T-4 slips, pay stubs, bank statements and employment verification letters as well as whether he was using straw buyers in trades.
Mr. Iqbal’s application to withdraw was approved by RECA and results in a voluntary lifetime prohibition from industry membership. By virtue of operation of the Real Estate Act, conduct proceedings are discontinued. Mr. Iqbal’s withdrawal application does not constitute an admission of misconduct.
HECTOR CORTEZ, ASSOCIATE
4th Street Holdings Ltd. o/a Re/Max Real Estate (Central)
On November 5, 2008, Hector Cortez, former associate most recently registered with 4th Street Holdings Ltd. o/a Re/Max Real Estate (Central) in Calgary, applied to the Real Estate Council of Alberta (RECA) to withdraw from industry membership in accordance with section 54 of the Real Estate Act.
At the time of his withdrawal application, a RECA investigation was ongoing to determine whether he failed to provide relevant information to a listing agent and purchaser. As well, it was alleged that Mr. Cortez failed to provide a $5,000 trust deposit to the brokerage and instead converted the monies to his own use.
Mr. Cortez’s application to withdraw was approved by RECA and results in a voluntary lifetime prohibition from industry membership. By virtue of operation of the Real Estate Act, conduct proceedings are discontinued. Mr. Cortez’s withdrawal application does not constitute an admission of misconduct.
STANLEY PENCHUK, CANDIDATE APPRAISER
Atkinson and Associates
On November 5, 2008 Stanley Penchuk, who was last licensed as a candidate appraiser with Atkinson and Associates in Calgary, applied to the Real Estate Council of Alberta (RECA) to withdraw from industry membership in accordance with section 54 of the Real Estate Act. A period of unlicensed activity occurred and Mr. Penchuk indicated no intention of continuing in the industry. Mr. Penchuk’s application to withdraw was approved by RECA and results in a voluntary lifetime prohibition from industry membership. The withdrawal does not constitute an admission of misconduct.
WARREN BURNETT, ASSOCIATE BROKER
Pace Properties Ltd. (formerly Buttco Properties Ltd.)
On November 5, 2008, Warren Burnett, associate broker registered with Pace Properties Ltd. (formerly Buttco Properties Ltd.) in Calgary, applied to the Real Estate Council of Alberta (RECA) to withdraw from industry membership in accordance with section 54 of the Real Estate Act. At the time of his withdrawal application, there was an ongoing RECA conduct investigation. The allegations of misconduct included failure to act in the best interests of a client when he preferred the interests of others in a rental pool, failure to act in accordance with a client’s lawful instructions by refusing to provide a 24 hour notice to tenants for property entry and failure to provide all relevant information the client might use to facilitate the selling of his units.
Mr. Burnett’s application to withdraw was approved by RECA and results in a voluntary lifetime prohibition from industry membership. By virtue of operation of the Real Estate Act, conduct proceedings are discontinued. Mr. Burnett’s withdrawal application does not constitute an admission of misconduct.
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