Most real estate transactions, whether you are a business owner entering a commercial lease, or a family purchasing a home, you are almost certainly using a real estate agent. All real estate agents owe their clients a duty of care. This duty requires the real estate agent to act in a way that is usual or necessary for the ordinary or proper performance of their duty as a real estate agent.1 The duties owed by the real estate agent will depend on the specific circumstances of each real estate transaction. The remedy for a real estate agent's breach of their duty of care is damages based on the loss sustained by their client caused by the breach.2
For example, a real estate agent has a duty to disclose important facts to their clients when they are purchasing a property.3 In one case, a real estate agent knew that his clients required a home with four bedrooms. The agent showed his clients a three-bedroom home that was staged to show four bedrooms. One of the rooms staged as a bedroom was not a legal bedroom in accordance with municipal by-law. The agent knew that the bedroom might not be in compliance with the by-law, but did not disclose this to his clients. The clients had already entered an agreement to purchase the home when they discovered that that there were only three bedrooms. The Court decided that the agent breached the duty he owed to his clients when he failed to disclose that the house did not have four-bedrooms. The agent was required to compensate his clients for the losses they sustained from failing to close the real estate transaction.4
If you suffer a loss on a commercial or residential real estate transaction due to the actions of your real estate agent, you may be entitled to compensation for your loss.
1 Malpass v. Morrison, 2004 ONSC 36076, at paras 18 and 22
2 Malpass v. Morrison, 2004 ONSC 36076, at para 18
3 Malpass v. Morrison, 2004 ONSC 36076, at para 20
4 Malpass v. Morrison, 2004 ONSC 36076
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.