Real Estate Commission paid on the Purchase of a Replacement Residence
Topic
Real Estate Commission paid on the Purchase of a Replacement Residence
Case number
- 2012-032 (F&R Date: 2012–05–30)
Description
Following the review of a grievance concerning the denial of reimbursement of real estate commission (REC) involving the 2009 Canadian Forces Integrated Relocation Program (CF IRP) policy, the Board concluded that REC fees were not reimbursable when purchasing a residence, and that ministerial discretion should not be used. However, the Board also found that greater clarity should be provided to Canadian Forces (CF) members by amending the CF IRP policy and its supporting documents; consequently, the Board recommended the re-insertion of a Note into the CF IRP policy, as well as its inclusion in the "It's Your Move" manual.
The Chief of the Defence Staff (CDS) agreed with the Board's recommendation and, in a decision letter of 15 September 2010, directed the Director General Compensation and Benefits to ensure the following Note was inserted in future CF IRP manuals: "Real Estate commission paid by a contractor or the member to a real estate agent is not reimbursable when purchasing a replacement residence."
While reviewing a more recent grievance concerning the same issue, the Board discovered that after almost two years, as well as the release of two annual policy documents since that CDS direction, no action, nor follow-up has occurred, on the matter, by the appropriate CF authorities. The Board found it very troubling that CDS orders would not be followed by subordinates in a timely manner, especially given that such a Note may affect a great number of CF members who move every year and who should be able to rely upon updated and clear policies.
Recommendation
Given that no action had been taken on the CDS direction, the Board reiterated its previous recommendation that the CDS direct the following Note be inserted in future CF IRP policies: "Real Estate commission (REC) paid by a contractor or the CF member to a real estate agent is not reimbursable when purchasing a replacement residence."
Final Authority Decision
The CDS agreed that members may have benefited from the clarity in the CF IRP and he has been assured by DGCB that a new policy will include the relevant or similar statement.