10. Ceasing of activities by a real estate agency or a broker acting on his own account

A ceasing of activities must be planned and be carried out in stages to ensure public protection. Clients must be informed of the situation and of the choices they will have to make.

As much as possible, the agency or broker acting on his own account must synchronize the ceasing of activities with the conclusion of the transactions in progress. It is preferable, for example, to wait until the conditions of transactions in progress have been fulfilled and all sums held in trust accounts have been cashed in prior to ceasing activities.

In the event that files cannot be finalized, they must absolutely be taken over by a licensee who holds a valid licence.

He will have to come to an agreement with an agency or another broker acting on his own account to take over his records and registers, other than those relating to his accounting, for a period of six years from the date of final ceasing of activities. A broker acting on behalf of an agency is not authorized to keep the records and registers of a broker acting on his own account.¹

¹ Section 19 of the Regulation respecting records, books and registers, trust accounting and inspection of brokers and agencies.

Responsibility of the agency or the broker acting on his own account

For a ceasing of activities, the agency or broker acting on his own account must:

1. identify the broker’s current brokerage contracts, including any co-listings, and send a written notice to clients informing them of the date of ceasing of activities and explaining the options available to them;

2. identify any accepted transaction proposals (sale and lease) and determine what can and cannot be finalized before the ceasing of activities:
   • transactions whose conditions have been fulfilled and which will be notarized before or after the date of ceasing of activities;
   • transactions whose conditions have not yet been fulfilled and which could be notarized before the date of ceasing of activities;
   • transactions whose conditions have not yet been fulfilled and for which the date of signing of the notarized act would fall after the date of ceasing of activities;
   • leasing transactions that could be subject to a lease renewal;

3. identify any cases of referral of clients to another licence holder, a mortgage lender or other and for which the agency or the broker acting on his own account has a remuneration agreement that has not yet been settled;
4. identify any remuneration to be paid or received;
5. enter into an agreement with an agency or broker acting on his own account to take over the records and registers, other than those relating to accounting, for a period of six years from the date of final ceasing of activities;
6. perform a bank reconciliation of trust accounts (general and special) prior to making any refunds or transfers;
7. for an agency, determine with each of the agency’s brokers, if applicable, and for each of the above-mentioned records, the proper procedure to follow;
8. identify any advances on remuneration or expenses provided for in any brokerage contract which remain in whole or in part in the trust account;

9. identify any sums representing deposits, security deposits or other provided for in the transaction proposals and which remain in the trust account;

More specifically, it is necessary to identify the transaction records that will be finalized after the ceasing of activities. Any sums will need to be transferred to another trustee.

10. identify any sums held in special trust accounts;
11. identify any investments that will mature after the date of ceasing of the agency’s activities. Such investments will need to be cashed in before maturity.

Once the sums have been identified, the agency or broker acting on his own account must:

• obtain the written consent of the parties to the change of trustees;
• if applicable, obtain in writing any other change to the agreements between the parties;
• obtain the written consent of the licence holder trustee for the transfer of the sums;
• cash in the investments in special accounts by transferring them to the general trust account and reimburse the interest to the depositors;
• reimburse clients for sums held in trust as advances on remuneration or expenses as soon as the brokerage contracts are terminated;
• transfer (by electronic transfer, cheque, letter of exchange or transfer slip) the sums in the general trust account to the new trustees or others based on the agreements and changes made;
  • The new trustees will need a copy of the records with which transferred sums are associated in order to be able to manage them properly.
• comply with all record-keeping obligations, including making entries in the trust accounting register and maintaining all supporting documentation on file.
• reconcile the trust accounts once the balances are at zero.

Once these steps have been completed and the agency or broker acting on his own is ready to cease operations and proceed with the closure, the Certification Department must be notified in writing of the date of revocation of their licence and pay the applicable fes. The list of fees is available under the “Administrative Fees” section of this page.

Once the licence of the agency or the broker acting on his own account has been account, the following must be done:

• Close the general trust account;
• Generate the Trust Transaction Report for the current year with a period end date corresponding to the date of closing of the account;
• Forward without delay the records and registers to the agency or broker acting on his own account having accepted to take them over;
• Complete the form Mandatory declaration • Ceasing of activities by a real estate agency or by a real estate broker acting on his own account (PDF);
• Send the following documents to the OACIQ Inspection Department:
  • the Trust Transaction Report for the current year, with the trust accounting register and bank statements for the period and document from the financial institution confirming the closing of the trust account;
  • the Trust Transaction Report for the current year, with the trust accounting register and bank statements for the previous year if these documents have not already been sent;
  • the Register of disclosure notices for the current year;
  • the Register of disclosure notices for the previous year if it has not already been sent;
  • The form Mandatory declaration • Ceasing of activities by a real estate agency or by a real estate broker acting on his own account (PDF).

Record conservation following a ceasing of activities

The obligation to conserve records and registers lies with the holder of an agency licence or a broker acting on his own account licence.

The records and register must be kept for a period of six years from the date of ceasing of activities.