Suing a Real Estate Agent for Negligence in Ontario: What You Need to Show

When a real estate deal goes badly and a buyer or seller believes their agent is to blame, the first instinct is often to file a complaint with the Real Estate Council of Ontario (RECO). That's a reasonable step — but a RECO complaint and a civil negligence claim against a real estate agent are different processes with different goals, and only one of them can put money back in your pocket.

This article explains the duties a realtor owes you, what a negligence claim actually requires, and how it fits alongside — or instead of — a regulatory complaint.

Realtors' Legal Duties to Their Clients

Real estate salespeople and brokers in Ontario are licensed and regulated by RECO under the Trust in Real Estate Services Act, 2002 (TRESA) — the current name, since December 2023, of what was formerly REBBA. That framework, along with general common-law principles, creates real obligations toward the clients an agent represents.

An agent representing you generally owes you:

• A duty of honesty and reasonable care and skill in carrying out the work of buying, selling, or leasing a property.
• A fiduciary duty, where a genuine agency relationship exists — meaning the agent must act in your best interests, avoid undisclosed conflicts of interest, and disclose material information relevant to your decisions.
• A duty to convey offers and material information promptly and accurately.

It's worth being precise about who an agent actually represents in a given transaction — a listing agent working for a seller, a buyer's agent, or, in some arrangements, an agent representing both sides. The duties an agent owes can differ depending on that role, so understanding your own representation arrangement is a useful starting point before assessing what went wrong.

RECO Complaint vs. a Civil Negligence Claim

Realtors cannot give legal advice, draft or interpret binding legal documents, or provide legal opinions on title — that's the lawyer's role in a transaction, and it's a separate question from whether an agent met their own professional obligations within the scope of real estate representation. A RECO complaint and a civil claim aren't mutually exclusive; some situations warrant pursuing both, on their own separate tracks.

What You'd Need to Prove in a Negligence Claim

As with any professional negligence claim, a court generally looks for:

1. Duty of care — that the agent owed you an obligation, typically straightforward to establish where a representation agreement existed.
2. Breach of the standard of care — that the agent's conduct fell below what a reasonably competent realtor would have done in similar circumstances.
3. Causation — that the breach actually caused your loss, rather than the loss arising from unrelated market or property factors.
4. Damages — a quantifiable financial loss connected to the breach.

As with lawyer negligence claims, a disappointing outcome on a deal — a property that turned out to need more repairs than expected, or a sale price that looks low in hindsight — isn't, by itself, evidence of negligence. The focus is on whether the agent's own conduct fell short of a reasonable professional standard.

Situations That Often Raise Questions

These are categories that commonly generate disputes — whether any one of them supports an actual claim depends entirely on the specific facts:

• The agent knew about a material defect or issue with the property and didn't disclose it to you.
• A conflict of interest wasn't disclosed — for example, representing both the buyer and seller without proper disclosure and consent.
• The agent failed to present an offer, or misrepresented the terms of a competing offer.
• Misrepresentations about the property's condition, size, zoning, or comparable sales that influenced your decision.
• A critical deadline in the agreement — a financing or inspection condition, for instance — was missed or mishandled due to the agent's error.

Steps to Take

• [ ] Gather your listing agreement or buyer representation agreement, all correspondence with the agent, and the Agreement of Purchase and Sale.
• [ ] Write out a clear timeline of what happened and what you believe the agent did or failed to do.
• [ ] Get an independent opinion from a lawyer before assuming a complaint or lawsuit will succeed — not every frustrating outcome meets the legal standard.
• [ ] Consider whether a RECO complaint, a civil claim, or both fit your goals — recovering money generally requires the civil route.
• [ ] Move promptly. Ontario law imposes time limits for starting a civil claim, and waiting too long can bar it entirely — confirm the applicable limitation period with a lawyer as soon as you suspect a problem.

Frequently asked questions