A licensee receives a competing offer on a listed property from a close family member. Under RESA, what is the licensee's obligation?

Q: What is the correct answer to: A licensee receives a competing offer on a listed property from a close family member. Under RESA, what is the licensee's obligation?

The correct answer is The licensee must disclose the relationship to all parties in writing and refer the matter to the managing broker. Option C is correct because under RESA, a licensee must disclose any conflict of interest in writing to all affected parties. A competing offer from a close family member creates a clear conflict of interest. The licensee must disclose this relationship to the seller (and all parties) in writing and refer the matter to the managing broker, who can determine appropriate steps to manage the conflict and protect all parties' interests.

Q: What background knowledge is needed for this Agency & Professional Ethics question?

RESA imposes strict conflict of interest disclosure requirements on licensees. A conflict of interest arises whenever a licensee has a personal interest that could conflict with their duty to act in their client's best interests. Family relationships, financial interests, and personal connections all create potential conflicts. The disclosure must be in writing, made to all affected parties, and the managing broker must be involved to ensure proper oversight. Failure to disclose is considered professional misconduct.

Q: What is a good way to remember the answer to this Agency & Professional Ethics question?

When a conflict arises, remember DW-DMB: Disclose in Writing, then Defer to Managing Broker. Both steps are required — disclosure alone is not enough; the managing broker must be brought in to supervise the situation. If the exam describes a conflict of interest scenario, look for the answer that includes BOTH written disclosure to all parties AND involvement of the managing broker. An answer with only one element is incomplete.

Q: What exam tip applies to this Agency & Professional Ethics question?

RESA conflict of interest questions always require written disclosure to ALL parties and managing broker involvement. If an answer suggests verbal disclosure, disclosure to only one party, or no managing broker involvement, it is wrong.

Q: How does this Agency & Professional Ethics concept apply in real world practice?

A licensee in Vancouver is the listing agent for a property. Her brother submits a competing offer through a different brokerage. The licensee immediately discloses the family relationship to the seller in writing, notifies the managing broker, and ensures the seller understands the conflict so they can make an informed decision about the competing offers.

Question

Agency & Professional EthicsBCMEDIUM

A licensee receives a competing offer on a listed property from a close family member. Under RESA, what is the licensee's obligation?

Answer Options

A

The licensee may proceed without disclosure if the family member is represented by another brokerage

B

The licensee must present all offers but is not required to disclose the relationship

C

The licensee must disclose the relationship to all parties in writing and refer the matter to the managing broker

D

The licensee must withdraw the family member's offer entirely