The agent who let his insurance lapse was quite fortunate. He overlooked paying it, received some notices, ignored them, received a registered letter of Suspension and ignored that too.
The Broker of Record received notices as well. It said: “You must CEASE TRADING in real estate effective September 1, 2014”. It’s not ambiguous!
The agent’s registration was suspended from September 1, 2014 to July 22, 2015 inclusive (the “Suspension Period”). In addition, the agent was not insured for trading in real estate during the Suspension Period.
You might think that the agent was not too busy during that 11 month period. You would be wrong, basically, the agent did two deals per month or 22 in total, all without insurance.
The matter went to the Discipline Committee of the Real Estate Council of Ontario, where fines were imposed against the agent in the amount of $5,000 and against the Broker of Record in the amount of $7,500. All in all, that doesn’t seem to be very hefty.
The primary difficulty is that had there been any claims arising out of those 22 transactions, the consumers would have found themselves without the benefit of a insurance liability policy to attend to payment of any claims.
It is interesting to note that the insurance payment required was $400.00 for one year’s coverage.
Brian Madigan LL.B., Broker