Your Agent’s Mistake Cost You Money in Ontario: A Timeline From the Day You Find Out to the 15-Year Backstop

Quick Answer

Day one: note when and how you found out

First weeks: gather documents, put the brokerage on written notice

Same window: decide separately whether to file with RECO

Next stage: calculate the loss and match it to a court

Two years after discovery: the basic deadline

Fifteen years after the act: the ultimate deadline

Day one: write down when, and how, you found out

Section 5 of the Limitations Act says a claim is “discovered” on the earlier of two days: the day you first knew four things (that a loss happened, that an act or omission caused or contributed to it, that it was the act or omission of the person you would claim against, and that a court proceeding would be an appropriate way to fix it), and the day a reasonable person in your circumstances ought to have known those things.

Then section 5(2) adds a presumption: you are taken to have known all of this on the day the act or omission took place, unless the contrary is proved. If the mistake happened at signing and you learned of it at closing months later, the burden is on you to show why the later date is the real one.

That is why the first useful thing to do is not dramatic. Write a dated note: what you learned, from whom, on what day, and what you could reasonably have known before that. Keep the email, text or document that told you.

The first weeks: collect the paper before it scatters

Most of what a lawyer will ask for already exists, but it sits in different hands. A practical list:

• Your representation agreement (buyer or listing agreement). Under O. Reg. 567/05, that agreement is between you and the brokerage, not the individual agent, which affects who a claim may be addressed to.
• The agreement of purchase and sale, every amendment, waiver and notice of fulfillment.
• The listing as it was advertised, including the MLS printout and feature sheet, if you can still get them.
• Emails, texts and messages with the agent, with dates intact.
• Your lawyer’s reporting letter and closing statement.

The brokerage has its own retention duty: O. Reg. 579/05, s. 19 requires it to keep the records it must make under the Act for at least six years unless the registrar sets a different period. A listing brokerage must keep a copy of an offer that did not result in a sale for at least one year (s. 20). Neither of those is your copy, though, and asking early is simpler than asking later.

The same weeks: put the brokerage on written notice

Because the agreement is with the brokerage, a written notice to the brokerage, addressed to its broker of record, is a natural first formal step. The Code of Ethics (O. Reg. 365/22, s. 16) makes the brokerage responsible for ensuring its brokers and salespersons comply with the Code, and the broker of record is responsible for the brokerage’s own compliance.

Where insurance fits: every registered brokerage, broker and salesperson in Ontario must be covered under the group policy arranged by RECO (O. Reg. 579/05, s. 11). The regulation defines the professional liability insurance it requires as insurance that pays damages and legal costs arising out of claims made against a registrant for an error, omission or negligent act in trading in real estate. It does not describe a consumer filing directly with the insurer. Practically, that means the coverage responds to a claim aimed at the agent or brokerage; it is not a fund you apply to.

The same weeks: a RECO complaint is a separate decision

You can file a complaint with RECO at any point. It helps to know what it can and cannot produce. According to RECO’s complaints process page (2026), it has no authority to order that monies be refunded, contracts be cancelled, or damages or restitution be awarded, and recommends getting legal advice if you are seeking damages.

What RECO’s process can lead to is regulatory: under the Trust in Real Estate Services Act, 2002 (TRESA), s. 21, the discipline committee can order education, conditions, suspension or revocation of registration, and fines of up to $50,000 for a broker or salesperson and $100,000 for a brokerage. Those fines are paid to the administrative authority (RECO), not to the person who complained.

One protection worth knowing: under s. 15(3) of the Code of Ethics, an agent or brokerage may propose mediation or a settlement, but any settlement agreement cannot require you to withdraw a complaint or promise not to make one. RECO notes its current process covers conduct on or after December 1, 2023; earlier conduct follows a separate process document.

Next: put a number on the loss, then match it to a court

Once the documents are together, the question becomes how much, and that number decides the venue. According to O. Reg. 626/00 as consolidated by Ontario (2025), the maximum claim in Small Claims Court is $50,000, and under s. 23(1) of the Courts of Justice Act that limit is measured exclusive of interest and costs.

Two points on insurance figures people often misread:

• The $1 million per claim and $3 million per policy year (per registrant) in O. Reg. 579/05 are legal minimums of coverage. They say nothing about what any claim is worth or will be paid.
• Deposits have their own coverage: at least $100,000 per claim and at least $1,000,000 for all claims arising from the same occurrence. If your loss is a deposit problem rather than advice gone wrong, that is a different track with its own coverage and is covered in a separate article on deposits.

RECO’s insurance program runs on a policy year from September 1 to August 31. The regulation makes registrants responsible for their share of premiums and deductibles; the deductible amount itself is not something I was able to confirm from a primary source, so it is not stated here.

💡 The dollar figure you arrive at in this stage effectively picks the court for you. Which court suits a specific claim is a question for a lawyer or licensed paralegal.

The two-year mark

Section 4 of the Limitations Act: a proceeding cannot be started after the second anniversary of the day the claim was discovered. Counted from discovery, not from closing and not from the day you complained.

There is one built-in pause. Under s. 11, if you and the person you are claiming against agree to have an independent third party resolve the claim or help you resolve it, both the two-year and the 15-year periods stop running from the date of that agreement until the claim is resolved, the process is terminated, or a party withdraws. Section 11(2) makes clear an impartial mediator counts as independent however it is funded. On the wording of the section, informal back-and-forth directly with the brokerage is not the same thing as an agreement to use an independent third party.

The outer wall: 15 years

Section 15(2) sets the ultimate limit: no proceeding can be started more than 15 years after the day the act or omission took place, even if you discovered it much later. This is the backstop for problems that stay hidden for years.

The 15-year period does not run while the person you are claiming against wilfully conceals the loss or its cause, or wilfully misleads you about whether a court proceeding is an appropriate remedy (s. 15(4)(c)). Under s. 15(5), the burden of proving that is on the person making the claim.

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