Obligations of All Ontario Registrants (REALTORS®)

April 15, 2024

Real estate is a highly regulated business in Ontario. These regulations protect consumers, establish standards and provide for a method of delivering consistent, predictable and professional services. It also provides a means to discipline those that do not uphold those standards. Real estate professionals standards include regulatory (TRESA), fiduciary (legal) and general obligations to consumers. Let’s look at the key players first then move on to standards of practice.

The Ministry of Government and Consumer Services (MGCS)

MGCS is a ministry in the Ontario government that delivers vital programs, services and products — ranging from health cards, drivers licences and birth certificates to consumer protection and public safety — all to help create a better quality of life for Ontario’s families.

Relationship between MGCS and RECO:
• MGCS is responsible for any amendments to the Trust in Real EState Services Act, 2002 (TRESA) and its associated regulations, as well as general oversight of RECO
• On behalf of MGCS, RECO enforces TRESA, and is responsible for day-to-day delivery of services
• The Minister of Government and Consumer Services reports to the Legislative Assembly on the fulfilment of the Statutory Mandate by RECO, and the affairs of RECO
• RECO’s Board of Directors is accountable to the Minister for the performance of RECO

Real Estate Council of Ontario (RECO)

RECO is the regulator for real estate professionals in Ontario. Registration is mandatory to legally trade in real estate in Ontario.

RECO’s mandate is consumer protection on behalf of the Ontario government. As a Delegated Administrative Authority, RECO enforces the law in the public interest.

RECO’s mission is excellence in the delivery of regulatory services that protects the public interest and enhances consumer confidence in the real estate profession.

RECO’s role is to:
• Help consumers make informed decisions when buying or selling a home and understand that there are benefits to working with a regulated professional;
• Administer and enforce TRESA and a Code of Ethics. Provide advice to government regarding consumer protection legislation;
• Help registrants understand and follow TRESA. Investigate complaints about registrants who may have violated TRESA;
• Be accountable to the public through the Ontario government;
• Set the standards for pre-registration, articling and broker education;
• Develop and deliver mandatory continuing education courses; and,
• Administer a mandatory insurance program that includes consumer deposit protection, errors and omissions coverage and commission protection.

Ontario Real Estate Association (OREA)

OREA is a professional association. Membership is voluntary.

OREA’s mandate is to work on behalf of real estate professionals.

OREA’s mission is to help Ontario REALTORS®, brokerages and associations succeed.

OREA’s role is to:
• Encourage consumers to use a REALTOR® when they buy or sell a home;
• Work to create a legislative and regulatory environment at Queen’s Park that is favourable to REALTORS® and real estate;
• Provide information, tools and services, like standard forms, to help REALTORS® with their businesses;
• Be accountable to its REALTOR® members;
• Deliver pre-registration, articling and broker education courses, as approved by RECO (beginning mid-2019, a new provider — Humber College and NIIT Canada — will deliver preregistration education. OREA’s program will continue until the end of 2020);
• Provide voluntary courses for individual professional development; and,
• Develop forms and clauses for residential and commercial transactions. For example, Agreement of Purchase and Sale, Listing Agreement and Buyer Representation Agreement.

TRESA 2002 Regulations & Code of Ethics

In Ontario, the provincial government writes the rules that real estate salespeople, brokers and brokerages must follow, and RECO enforces those rules on the government’s behalf. Below, find legislation and regulations that govern RECO and the real estate profession.

The  Trust in Real Estate Services Act, 2002, S.O. 2002, C.30, Sched. C (TRESA 2002) is the legislation that real estate salespersons, brokers and brokerages must follow. Associated regulations are in the links below:

Obligations of Registrants

Matters Involving Integrity, Etc.

Integrity, honesty, good faith, etc.
1. In carrying on business, a registrant shall act with courtesy, honesty, good faith and integrity in relation to every person the registrant deals with.

Unprofessional conduct, etc.
2. A registrant shall not engage in any act or omission that, having regard to all of the circumstances, would reasonably be regarded as,

(a) being disgraceful, dishonourable, unprofessional or unbecoming a registrant; or

(b) likely to bring the sector into disrepute or to undermine public confidence in the regulation of registrants under the Act.

No counselling contraventions
3. A registrant shall not counsel, advise or knowingly assist a person to contravene the Act, the regulations or any other law that is applicable to a trade in real estate or that is relevant to carrying on a registrant’s business.

Fraud
4. A registrant shall not engage in or be a party to fraud.

Misrepresentation, etc.
5. In carrying on business, a registrant,

(a) shall make best efforts to ensure that any representations are accurate and are not misleading; and

(b) shall not engage in or be a party to misrepresentation or any unethical practice.

No discrimination, etc.
6. In carrying on business, a registrant shall not treat any person in a manner that would contravene the Human Rights Code.

Intimidation, coercion, etc.
7. In carrying on business, a registrant shall not engage in conduct that is intimidating, coercive or abusive or that constitutes undue pressure or harassment.

Conscientious, Competent and Quality Service

Best interests
8. (1) A registrant that represents a client shall promote and protect the best interests of the registrant’s clients. O. Reg. 365/22, s. 8 (1); O. Reg. 234/23, s. 1 (1).

(2) If a registrant that represents a client believes that a client’s ability to understand information or make decisions relevant to a trade in real estate may be impaired, the registrant shall make reasonable efforts to ensure that the client understands the information and appreciates the reasonably foreseeable consequences of the decision. O. Reg. 365/22, s. 8 (2); O. Reg. 234/23, s. 1 (2).

Conscientious and competent service, etc.
9. (1) A registrant shall provide conscientious, courteous and responsive service to clients and demonstrate reasonable knowledge, skill, judgment and competence in providing such service. O. Reg. 234/23, s. 2.

(2) Subject to section 10, in carrying on business, a registrant shall demonstrate reasonable knowledge, skill, judgment and competence in providing opinions, advice, assistance or information to any person. O. Reg. 234/23, s. 2.

Dealings with self-represented parties
10. A registrant shall not, in respect of a trade in real estate,

(a) provide services, opinions or advice to a self-represented party; or

(b) encourage a self-represented party to rely on the registrant’s knowledge, skill or judgment.

Services from others
11. (1) A registrant shall advise a person to obtain services from another person if the registrant is not able to provide the services with reasonable knowledge, skill, judgment and competence or is not authorized by law to provide the services.

(2) A registrant shall not discourage a person from seeking a particular kind of service from another person if the registrant is not able to provide the service with reasonable knowledge, skill, judgment and competence or is not authorized by law to provide the service.

Confidentiality
12. Except as is otherwise authorized or required by law, a registrant shall not disclose to a third party any confidential information of a client without the client’s written consent.

Conflicts of Interest

Conflicts
13. In carrying on business, a registrant shall not provide services to a client or continue to provide services to a client where the interests of the registrant conflict or may conflict with the interests of the client unless the registrant has,

(a) disclosed to the client or prospective client any transaction or relationship that gives rise to or could reasonably be expected to give rise to a conflict of interest;

(b) advised the client or prospective client to seek independent professional advice with respect to the disclosure made under clause (a);

(c) taken all reasonable steps to ensure that the client or prospective client has demonstrated a reasonable understanding of the conflict or potential conflict of interest; and

(d) obtained consent in writing from the client or prospective client to the provision of the registrant’s services despite the conflict or potential conflict of interest. O. Reg. 365/22, s. 13; O. Reg. 234/23, s. 3.

Other Relationships

Dealings with clients of other registrants
14. A registrant who knows or ought to know that a person is a client of another registrant shall communicate information to the person for the purpose of a trade in real estate only through the other registrant, unless the other registrant has consented in writing.

No obstruction
15. (1) A registrant shall not obstruct or attempt to obstruct the administration or attempted administration of the Act or its regulations.

(2) Without limiting the generality of subsection (1), a registrant shall not,

(a) obstruct or attempt to obstruct any person from making a complaint to the registrar;

(b) obstruct or attempt to obstruct the registrar from making a written request for information with respect to a complaint or otherwise or from receiving accurate or complete information in response to such a request; or

(c) induce or attempt to induce a person to withdraw a complaint about a registrant to the registrar.

(3) For greater certainty, a registrant does not violate this section by suggesting or engaging in mediation, settlement discussions, negotiation or arbitration to resolve a dispute, but any agreement to resolve a dispute must not include a requirement to withdraw or refrain from making a complaint to the registrar.

Duty to ensure compliance
16. (1) A brokerage shall ensure that every salesperson and broker that the brokerage employs carries out their duties in compliance with this Regulation.

(2) The broker of record of a brokerage shall ensure that the brokerage complies with this Regulation.

Do you have a question of concern regarding the regulatory agencies that govern the real estate profession or obligations of REALTORS®? Just email me or fill out the contact form. I will be glad to answer your questions and offer advice.

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