What is the Special Compensation Fund?
The Real Estate Special Compensation Fund was introduced in 2005 under the Real Estate Services Act to protect trust accounts in real estate transactions. Participation in the fund is mandatory for all real estate licensees. The fund provides protection if you have suffered a compensable loss through the provision of real estate services in circumstances where money entrusted to a real estate licensee or an unlicensed individual related to the brokerage has been:
- misappropriated or wrongfully converted;
- intentionally not paid over or accounted for; or,
- obtained by the fraud of that licensee or individual.
Who oversees the Compensation Fund?
The Real Estate Compensation Fund Corporation (RECFC) is responsible for overseeing the compensation fund. Its board of directors consists of three directors appointed by the Real Estate Council of British Columbia (”the Council”) and two directors appointed by the British Columbia Real Estate Association (BCREA).
How do I make a claim?
The Real Estate Council is responsible for administering the Compensation Fund claim process. Should you believe that you have suffered a compensable loss, you should immediately contact the Council at:
In the event that you have commenced or are contemplating court proceedings related to a compensable loss, you should be aware that you must provide written notice to the Real Estate Council of any court proceeding and, as the Real Estate Compensation Fund Corporation has the option of being a party to any such court proceeding, written notice to the RECFC as well.
You are encouraged to fully review sections 60 – 72 of the Real Estate Services Act and to seek legal advice.
Will my claim be approved?
Staff at the Real Estate Council will review your claim and if it appears that there may be a compensable loss, the claim will be referred to the Council’s Compensation Committee which may:
- conduct a hearing to determine whether you suffered a compensable loss and, if applicable, assess the amount of that loss;
- decline to make either a determination or assessment, or both, on the basis that it considers the matter would more effectively be dealt with by a court proceeding; or,
- postpone conducting a hearing pending the conclusion of a discipline hearing or court proceeding.
If, after a compensation hearing, the Compensation Committee concludes that there has been a compensable loss and assesses the amount, the Compensation Committee will issue a certificate. Likewise, if a Council’s Disciplinary Hearing Committee or the Superintendent of Real Estate determines, after a hearing, that there has been a compensable loss and assesses the amount, the Compensation Committee will issue a certificate without the need for a further hearing.
What happens if the Compensation Committee defers to the court?
If the Compensation Committee defers to the court, and the court makes a finding on the evidence of compensable loss and assesses an amount, that finding is binding on the Compensation Committee and the Real Estate Compensation Fund Corporation in the same manner as a finding of compensable loss by a Compensation Committee.
How do I get paid once a certificate has been issued?
The Real Estate Compensation Fund Corporation is obligated to pay out once a certificate of compensable loss has been issued by the Compensation Committee. Payment is limited to a maximum of $200,000 for a single claimant. In the case of a single real estate brokerage, payments are limited to a maximum of $1,000,000 in total, regardless of the number of claimants. Payments are adjusted for amounts already recovered from other sources.
Are there any limitations on recovery?
- Compensable losses must arise from the provision of real estate services as defined in the Real Estate Services Act. There is no recovery from the Special Compensation Fund if your loss arises from conduct that occurred prior to 2005.
- The time limit for making a claim is two years after the earlier of the date on which you became aware that the compensable loss occurred or, if the licence of the responsible brokerage was cancelled at any time after the conduct that caused the compensable loss, two years after the date of that cancellation,
- A finding of compensable loss must be a decision arising from a hearing on evidence — it cannot arise from a consent order process or from a judgment in default.
How do I get further information?
If you have any questions about Compensation Fund claims, please contact the Real Estate Council at: