Multiple representation복수 대리 (양측 대리)

What is it?

Multiple representation is when one brokerage (real estate company) or one designated representative represents two or more clients with competing interests in the same deal. The classic case is representing both the seller and the buyer. In the industry it is called "double ending", and in other places "dual agency".

It is also multiple representation when the same brokerage (or the same designated representative) represents two competing buyers interested in the same home, even if the home is listed by another brokerage.

Ontario law does not ban multiple representation, but it cannot happen without written disclosure and every client’s written consent. RECO (the regulator of Ontario real estate agents) says agreeing to it significantly reduces what the brokerage and its agents can do for you.

Brokerage representation vs designated representation: when does it arise?

Since December 1, 2023, Ontario has two kinds of representation agreements, and multiple representation arises at different points under each.

RECO says designated representation reduces the likelihood of multiple representation. Ask the brokerage which kind it uses before you sign. At a brokerage that mixes both kinds, it is multiple representation if one of the clients is under a brokerage representation agreement.

What do you lose if you consent?

Once you consent, the brokerage or designated representative is no longer on your side; it becomes a neutral facilitator. The law requires it to treat every client objectively and impartially. That means:

• No advice on how much to offer or how much to accept.
• No advice on what conditions to put in an offer or which to accept.
• No advice that would favour one client over the other. The agent cannot negotiate or advocate for you.
• Confidential information you gave while you were represented (budget, bottom price, reasons for buying) cannot be shared without your written consent.

RECO Bulletin 3.2 says that in multiple representation "none of the clients are fully represented".

The steps the law requires

1. Disclosure: as soon as the brokerage knows it has more than one client in the same deal, it must disclose this in writing to each client (and prospective client). The disclosure must say that it proposes multiple representation, and how its duties, services and fee arrangements would differ from representing one client only.
2. Acknowledgement: it must make best efforts to get your written acknowledgement that you received the disclosure, and give you a copy if you sign.
3. Consent: each client must consent in writing after receiving the disclosure. If even one client refuses, multiple representation cannot go ahead.
4. Until then, the brokerage cannot take any further step for any of the clients. RECO says disclosure and consent at the time an offer is submitted is "in almost all circumstances, too late".
5. The brokerage must advise you to get independent professional advice (for example, from a lawyer) before consenting. The agent cannot advise you on whether consenting is in your interest, because of the fee at stake.

Disclosure must be specific to each situation. If the seller and a buyer have consented and a second buyer appears, all three must receive a new disclosure and consent again.

Can you refuse? What happens then?

Yes. You have the right to refuse, and if you do, the brokerage cannot proceed. RECO expects the brokerage to explain your alternatives clearly, for example handing that one deal to a different designated representative at the same brokerage, or getting representation from another brokerage.

Your representation agreement should say what happens if you refuse. The agreement might end completely, or that one deal might go to another agent while the agreement continues. Check this clause before you sign.

RECO also tells agents to avoid creating multiple representation in the first place. For example, if a buyer approaches a brokerage about its own listing, the brokerage should not take the buyer on as a client and should refer them elsewhere.

Other buyers must be told

If the same brokerage has both the seller and a buyer as clients, it must disclose that fact to every other buyer who makes a written offer, before any offer is accepted (O. Reg. 567/05, s. 22.0.3). This applies even when different designated representatives act for each side and it is not multiple representation.

If you are competing in a multiple-offer situation, check that you received this disclosure. It means you are bidding against a buyer who is a client of the listing brokerage.

What about the commission?

Your representation agreement should say how the fee changes if you consent to multiple representation. A seller’s agreement should state separately what the seller pays when the same brokerage also represents the buyer, and what goes toward the buyer’s fee; a buyer’s agreement should state what the buyer pays on consenting.

Before you consent because of a fee discount, weigh it against losing all advice on price and terms. RECO specifically warns against creating multiple representation just so the seller will pay the buyer’s brokerage fee.

Questions to ask

• Is this brokerage using brokerage representation or designated representation?
• Is another agent at the same brokerage working with the other side? Does that make it multiple representation?
• If I consent, exactly how do my services and my fee change? (This must be in the written disclosure.)
• If I refuse, what happens to my agreement? Can you refer me to another agent?
• Will I have time to talk to a lawyer before I decide?

Example