Commission Clawback 

(Ontario)

Question:

In Broker’s Remarks on an MLS, it states the following: “Cooperating Broker will pay Listing Broker a Referral Fee of 40% of the Cooperating Broker Commission if the Listing Broker has taken the Buyer through the property.”

Will this work, legally?

Answer:

No. The wording is insufficient. This type of approach could be properly structured as a bonus but not as a penalty.

Brian Madigan LL.B., Broker

www.OntarioRealEstateSource.com