Standard Forms Updating

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1 Standard Forms Updating OREA has now announced the forms that will be added or changed in We do not currently have a date for when the updated forms will appears on WEBForms or OREA.com. Once they do become available, we will advise members immediately via Message of the Day. Similarly, we do not have a date that the No Carbon Required (NCR) 2014 forms will be available for sale at the Board Office. Once they become available, you will be notified in Membership News. Please continue to order small quantities of these forms until the new versions become available, as there will be no refunds for out-of-date forms. We generally recommend that members order no more than about a month s supply of forms. The following forms will be changing for 2014: Form 100 Agreement of Purchase and Sale Residential (REVISED) Form 101 Agreement of Purchase and Sale Condominium (REVISED) Form 102 Agreement of Purchase and Sale Co-operative Building Resale (REVISED) Form 103 Option to Purchase (REVISED) Form 108 Entry/Access to Property Acknowledgement (NEW) Form 110 Agreement of Purchase and Sale Mobile/Modular/Manufactured Home (REVISED) Form 111 Agreement of Purchase and Sale POTL Common Elements Condominium (REVISED) Form 115 Agreement of Purchase and Sale Co-ownership Building Resale (REVISED) Form 120 Amendment to Agreement of Purchase and Sale (REVISED) Form 122 Mutual Release (REVISED) Form 127 Acknowledgement Re: Conditions in Offers (REVISED) Form 145 Assignment of Agreement of Purchase and Sale (REVISED) Form 150 Assignment of Agreement of Purchase and Sale (Condominium) (REVISED) Form 221 SPIS Schedule for Condominium (REVISED) Form 240 Amendment to Listing Agreement Price Change/Extension/Amendments(s) (REVISED) Form 320 Confirmation of Co-operationg/Representation (REVISED) Form 400 Agreement to Lease Residential (REVISED) Form 401 Schedule A Revised to be Schedule (REVISED) Form 405 Amendment to Agreement to Lease Residential (REVISED) Form 500 Agreement of Purchase and Sale Commercial (REVISED) Form 501 Agreement of Purchase and Sale Condominium Resale Commercial (REVISED) Form 502 Agreement of Purchase and Sale Business in Leased Premises (REVISED) Form 510 Agreement to Lease Commercial (Long Form) (REVISED) Form 511 Agreement to Lease Commercial (Short Form) (REVISED) Form 513 Amendment to Agreement to Lease - Commercial (REVISED) Form 515 Agreement to Sub-Lease Commercial (REVISED) Form 517 Amendment to Agreement to Sub-Lease Commercial (REVISED) Form 600 Broker/Salesperson Employment Agreement (REVISED) Form 639 FINTRAC Risk Assessment for Brokerage (REVISED)

2 The Working with a REALTOR has been revised. Members will be advised when they become available at the Board Office for purchase. There are four new clauses that were added to the OREA Standard Clauses section. They are: Chatt-1 Condition Rental Contracts Insp-16 Seller s Consent for Photos/Videos Zoning-5 Restriction Short Term Accomodation Acc-7 - Water Access Fluctuating Water Levels The following three clauses have been deleted. They are: 1 Fax 1 Sewer/Water 5 Please review the full report and summary which has been provided by the OREA Forms Committee outlining the reasons for the additions and/or changes.

3 Standard Forms Committee Report September 30, 2013 This has been an active and productive year for the Standard Forms Committee. The Committee reviewed a large number of requests from Members, Real Estate Boards and other interested parties. As a result, a number of revisions and refinements were made to the OREA Standard Forms and Clauses and a new form has been created. WWAR: This year, considerable time was spent on the Working With a REALTOR brochure. The work on the brochure began with modifications to the layout to make it more user-friendly. The Acknowledgement panel of the brochure now has two lines for the names and signatures of the Buyers/Sellers instead of one and provision for both sets of initials to be added by the parties. The words and have received a copy have also been added to the Acknowledgement. The Committee noted that the information in WWAR has remained basically the same for several years and decided to undertake a complete review of the text of the brochure. This resulted in a completely rewritten 2014 version of Working With a Realtor. It was also noted that there has been an increase in the use of the one page faxable version of WWAR and this version was reformatted to provide a more attractive layout of the information on one page. Form Entry/Access to Property - Acknowledgement One subject that has become a hot topic in 2013 is the issue of which registrant should be present when a non-registrant, for example, a home inspector, requires entry to a listed property. There is not complete agreement as to whether the listing salesperson or selling salesperson, or both, or neither are required to be present for such an entry. As most Members are aware, the Real Estate Council of Ontario has recently communicated with a number of Real Estate Boards on this topic. There is agreement that there should not be any misunderstandings or problems with the seller on this issue, therefore the Standard Forms Committee created Form Entry/Access to Property - Acknowledgement to obtain an acknowledgement from the sellers that they are aware of and consent to who will be present during a non-registrant entry to the property. In addition, a section was included on Form 108 to provide the seller s consent for the nonregistrant to take photos/videos of the property.

4 Standard Forms Committee Report September 30, Form Agreement of Purchase and Sale This year, the Standard Forms Committee received a number of expressions of concern and suggestions surrounding the topic of rental items assumed when a buyer takes possession of a property. There was agreement that many buyers are not aware of the implications of assuming a rental/lease contract for an item that is not free and clear on the purchase of the property. The Committee discussed various possibilities to make buyers more aware of these situations. There was also concern that too much attention to this issue in the Agreement of Purchase and Sale could make a buyer(s) offer less attractive to the seller(s), especially in a situation when there are multiple offers. The Committee revised Clause 6 - Rental Items in the Agreement. The words (Including Lease, Lease to Own) were added to the heading of the clause and an additional sentence was added at the end of the clause, clarifying that the buyer will be responsible to do whatever is necessary to complete the assumption of the rental contract. It is hoped that these revisions may attract the attention of a buyer who may be concerned with the issue of assuming rental contracts. As an additional revision to the Agreement of Purchase and Sale, in the Acknowledgement section on page 5, an extra line was added to provide for the Lawyer s address. (It is understood that applicable revisions will be made to all of the OREA Agreements of Purchase and Sale) In addition to the revision to the Rental Items clause in the Agreement of Purchase and Sale described above, a conditional clause (included at the end of this report) has been added to the OREA Standard Clauses providing for the buyer to obtain details on the rental contract and having a time frame to approve the terms. Form Mutual Release In response to a request, the Committee made a revision to Form Mutual Release. The statement indicating that the brokerage(s) release the parties from any liability was moved to the bottom of the form, above the section for the signature(s) of the brokerage(s). Form Condition(s) in Offer- Acknowledgement A minor change was made to Form Acknowledgement Re: Condition(s) in Offer. It was noted that the title was a bit different from the titles of other standard forms. This simply required the information in the title to be reversed.

5 Standard Forms Committee Report September 30, Form Seller Property Information Statement - Schedule for Condominium A small change was also made to Form Seller Property Information Statement Schedule for Condominium. In section 10, a line was added to indicate the Parking Space number(s). In section 11, a line was added to indicate the Locker Number(s). Form Amendment to Listing Agreement - Price Change/Extension/Amendment(s) A minor change was also made to Form Amendment to Listing Agreement. A sub-title was added to the form to indicate the purpose(s) of the form and make it more user-friendly. Form Confirmation of Co-operation and Representation Changes were made to Form Confirmation of Co-operation and Representation. On page 2, in Clause 3.C), the wording was changed from The Co-operating Brokerage is not providing customer service to the buyer. to The Co-operating Brokerage has not entered into an agreement to provide customer service(s) to the buyer. The new wording is more specific and better conforms to the text in the REBBA Code of Ethics. While the Committee was reviewing this form, it was pointed out that the layout of the signing and initialing did not conform to the normal sequence of events, because the buyer usually signs and initials before the seller. All of the signing and initialing sections were reversed so that the areas for the buyer were before the sections for the seller to sign and initial. Form Agreement to Lease - Residential Changes were made to Form Agreement to Lease Residential. On page 1, a line was added to clearly state the legal address of the Landlord for receipt of notices, as required by the Residential Tenancies Act. In addition, two new clauses were added to the form; Clause 14, Insurance, and Clause 15, Residency. It is interesting to note that the Income Tax Act has a requirement for withholding of rent from a non-resident Landlord similar to the well known requirement to withhold funds for a non-resident seller s capital gains tax. Clause 15 deals with this issue. Standard Clauses: In addition to the work completed on the Standard Forms, the Committee also reviewed and revised the Standard Clauses, resulting in the addition of new clauses for 2014:

6 Standard Forms Committee Report September 30, Chatt-1 Condition - Rental Contracts This offer is conditional upon the Buyer reviewing the terms of any rental agreements, rental contracts, lease contracts or lease to own agreements ( Rental Agreements ) with respect to the rental items not included in the purchase price but to be assumed by the Buyer and finding such terms to be satisfactory to the Buyer in the Buyer s sole and absolute discretion. The Seller will provide copies of such rental agreements within days of acceptance of this offer. Unless the Buyer gives notice in writing to the Seller personally or in accordance with any other provisions for delivery of notice in this Agreement of Purchase and Sale or any Schedule thereto not later than 5:00 p.m. on the day of, 20, that this condition is fulfilled, this offer shall be null and void and the deposit shall be returned to the Buyer in full without deduction. This condition is included for the sole benefit of the Buyer and may be waived at the Buyer s sole option by notice in writing to the Seller as aforesaid within the time period stated herein. Insp-16 Seller s Consent for Photos/Videos The Seller(s) acknowledge(s) and consent(s) to a third party taking photographs/videos of the property as required for the purpose of an inspection with respect to the above. Note: This clause may be added to an inspection condition e.g. appraisal, home inspection, when there is an expectation that photos/videos will be taken by the third party. Zoning-5 Restriction - Short Term Accommodation The Buyer acknowledges that the municipality where the property is situated may have a bylaw that restricts or limits the owner s right to rent out property and the buyer agrees to purchase the property subject to that restriction or limitation. Acc-7 Water Access - Fluctuating Water Levels The Buyer acknowledges that the water levels in the area where the property is situated may fluctuate between a low and high water level and may be extremely low or extremely high from time to time. Therefore, access to the property through means of water and/or access to the water from the property may be difficult or not available. The Buyer agrees that no claim will be made against the Seller, or any Brokerage, Broker or Salesperson, respecting the levels of the water including without limitation matters of access whether to the property by water or from the property to the water. In addition to the new clauses, OREA staff will be reviewing all the OREA Standard Clauses to ensure that clauses that are no longer necessary are removed from the list and all of the OREA clauses are current and up-to-date.

7 Standard Forms Committee Report September 30, As Chairman, I would like to thank the members of the Standard Forms Committee and express my appreciation for their exceptional input on the many topics reviewed by the Committee this year. Standard Forms Committee Members: Cassandra Agnew-Walker Richmond Hill, ON Stan Albert Vaughan, ON Scott Bragagnolo Timmins, ON Bill Courtney Windsor, ON Rick Crouch Collingwood, ON Jason Fleming Niagara Falls, ON Josie Manna Orillia, ON Maureen O Neill Toronto, ON Karen Pynn Manotick, ON John Burnet RECO Liaison Toronto, ON Respectfully submitted, Tom Lebour, Chair Standard Forms Committee

8 Forms Revisions 2013 Working With a Realtor A complete rewriting was done on the Brochure and the one page version was re formatted. Form 100 Revised Clause 6, Rental Items to (Including Lease, Lease to Own). A statement was added that the buyer would co operate and sign the necessary documents to assume the item. In the Acknowledgement section a line was added for the Lawyer s address. The Rental Items change will be done on several forms; all Agreements of Purchase and Sale. The Lawyer s address will be added to all forms with an Acknowledgement that includes information on lawyers. This includes Forms 100, 101, 102, 103, 110, 111, 115, 120, 145, 150, 400, 405, 500, 501, 502, 510, 511, 513, 515, 517. Form 103 a small housekeeping correction was made. On page 4 at the bottom it mentions Goods and Services Tax, now changed to Harmonized Sales Tax. Form 108 New Form. Entry/Access to Property Acknowledgement Form 122 Third line from top, an (S) was added to Brokerage. The sentence stating the brokerage releases both parties was relocated to the bottom of the form just above where the brokerages sign. Also, in that statement, the word both was changed to all. Form 127 Reversed order in title. Form 221 Added line in 10. for Parking space number(s)... Added line in 11. for Locker number(s) Form 240 Added subtitle top form describing the actual functions; Price Change/Extension/Amendment(s). It is expected that the sub title will be included in any index of the forms and the purpose of this form will be more readily understood. Form 320 Reversed all the initialing and signing areas so that buyer would be on left and seller on right. Revised 3 c) stating the brokerage has not entered into agreement with buyer. In Commission 3 a), added to be paid after the blank area so that it now reads to be paid from the amount Form 400 On the first page, near the top, an extra line was added for the address for service of the Landlord. On the second page, two additional clauses were added, 14 Insurance and 15 Residency. Form 401 Schedule A revised to be Schedule Form 511 Clause 8, repetitive words removed. Form 600 Clause 4 Consentt. Extra t removed from consent. Form 639 Revisions made by CREA.

9 New Standard Clauses: In addition to the work completed on the Standard Forms, the Committee also reviewed and revised the Standard Clauses, resulting in the addition of new clauses for 2014: Chatt-1 Condition - Rental Contracts This offer is conditional upon the Buyer reviewing the terms of any rental agreements, rental contracts, lease contracts or lease to own agreements ( Rental Agreements ) with respect to the rental items not included in the purchase price but to be assumed by the Buyer and finding such terms to be satisfactory to the Buyer in the Buyer s sole and absolute discretion. The Seller will provide copies of such rental agreements within days of acceptance of this offer. Unless the Buyer gives notice in writing to the Seller personally or in accordance with any other provisions for delivery of notice in this Agreement of Purchase and Sale or any Schedule thereto not later than 5:00 p.m. on the day of, 20, that this condition is fulfilled, this offer shall be null and void and the deposit shall be returned to the Buyer in full without deduction. This condition is included for the sole benefit of the Buyer and may be waived at the Buyer s sole option by notice in writing to the Seller as aforesaid within the time period stated herein. Insp-16 Seller s Consent for Photos/Videos The Seller(s) acknowledge(s) and consent(s) to a third party taking photographs/videos of the property as required for the purpose of an inspection with respect to the above. Note: This clause may be added to an inspection condition e.g. appraisal, home inspection, when there is an expectation that photos/videos will be taken by the third party. Zoning-5 Restriction - Short Term Accommodation The Buyer acknowledges that the municipality where the property is situated may have a bylaw that restricts or limits the owner s right to rent out property and the buyer agrees to purchase the property subject to that restriction or limitation. Acc-7 Water Access - Fluctuating Water Levels The Buyer acknowledges that the water levels in the area where the property is situated may fluctuate between a low and high water level and may be extremely low or extremely high from time to time. Therefore, access to the property through means of water and/or access to the water from the property may be difficult or not available. The Buyer agrees that no claim will be made against the Seller, or any Brokerage, Broker or Salesperson, respecting the levels of the water

10 including without limitation matters of access whether to the property by water or from the property to the water. In addition to the new clauses, three obsolete clauses have been deleted: -1, Fax- 1, and Sewer/Water- 5.