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Brian Madigan LL.B., Broker

RE/MAX West Realty Inc.,
Independently owned and operated

96 Rexdale Blvd. 
Toronto, Ontario 

Phone: 416-745-2300

Cell: 647-404-8150 
Toll Free: 1-888-507-0817

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A Fair System for Multiple Offers in Real Estate- the Parties

December 29, 2017 - Updated: December 30, 2017

A Fair System for Multiple Offers in Real Estate- the Parties

At the outset, we should acknowledge “stealing” a few ideas from the construction industry and competitive sports.


Right now, all the power rests with the Sellers. Let’s change that a bit. While I might like to see Sellers of private re-sale real property no longer exempt under the Competition Act, we all know that that will not happen this decade. Let’s change what we can change.

The thought is that Sellers are exempt from everything under the Real Estate and Business Brokers Act, 2002; and while that’s true to a certain extent, they can indeed be controlled in respect to their access to the MLS system and their use of a real estate practitioner registered under the Act.

Sellers, including the mere posters agree to have the sales price of their properties published under the MLS system as soon as the transaction becomes unconditional. So, they can agree to other things too, like selling and complying with the “multiple offer” rules.

Consequently, by agreeing to utilize the MLS system Sellers agree to adopt the fair rules.


Up until now, Buyers have had “no rights”. They have just become “pawns in the system”. Any rights that they may have had are truly “tokenism”.

Consider the fact that after being unsuccessful, RECO will investigate and inform you, that there were two other bids. You don’t get another chance, the property is gone!

Consider the fact that after being successful, RECO will investigate and inform you, that there were no other bids. You don’t get your excess money back!

To some extent, there is an argument that the Sellers are paying all of the commission, so the system should favour the Sellers.

Similarly, there’s an argument that all of the money to pay for the commissions in the first place, flows from the Buyer. This is supported in cases where the Courts value a property at 100% if there is an agent and 95% if there is no agent at all.

The construction industry values all the bidders. In sports, both competing teams are equally valued. It’s time that the laws were strengthened to assist Buyers.

Listing Agents (individual registrants)

If Listing Agents were just “listing agents” then that would be fine. But, once they take off their umpire’s uniform and wish to compete by submitting their own team, then we have a problem.

Now, they might do this more than once. So, instead of fielding just one team, they might have two or more in the same competition. So, we would need rules to make it equally fair for everyone.

Buyer Agents (individual registrants)

Generally, we have a situation where there is one buyer Agent for each Buyer, but a particular Buyer’s Agent, could have two or more Buyers competing with each other, and with the Seller to secure the property. How are we going to make this fair?

Brokerages as Listing Agents

Part of the difficulty with multiple representation is the fact that legally we have made the Brokerage “THE” agent, rather than the individual salesperson. That throws a lot of people off. Most consumers thought that Bob was their agent, not the Brokerage he worked for.

It would be reasonable to have the individual registrants as the agents in most cases. Brokerages will be opposed to this change since it will likely diminish their role.

In the interim, “designated agency” is an answer. The Brokerage in the event of a potential conflict dealing with two clients, either the Seller and the Buyer, or two Buyers competing for the same property, may appoint specific salespersons within their Brokerage to take on the various roles “without conflict”. So, that means that their allegiance and their fiduciary obligations are owed to one person, not two. It’s a strange way of dealing with things, but Brokerages do not want to become Staples providing “back end” services to real estate practitioners.

What would be the role of the Brokerage? We could have them acting as the Umpire. That would work. We could also have them selecting the Umpire. That would work too.

Co-operating Brokerage

Frequently, we have two agents from ABC Brokerage with two different Buyers each competing for the same property listed with XYZ Brokerage.

This really isn’t a problem. They don’t know about one another. Right now, the expectation is that the Listing Brokerage will inform them, so that they can implement their multiple representation policy. This is crazy thinking. It has nothing to do with the Listing Brokerage. It’s not their responsibility. If there is any monitoring going on, it should be entirely handled by the Co-operating Brokerage.

Register the Offer with their own front desk. If a second one comes along, then now they know. What does “supervision” mean if it doesn’t mean at least this?

Two different agents from the same Co-operating Brokerage should be able to act independently in the best interests of their own Clients without a problem.

Brian Madigan LL.B., Broker

Tagged with: fair bidding system for ontario buyers
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Brian Madigan LL.B. Broker

RE/MAX West Realty Inc. Brokerage

Independently owned and operated

96 Rexdale Blvd. , Toronto Ontario,

Phone: 416-745-2300

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