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Commission Agreement (Real Estate) for Canada

Commission Agreement (Real Estate) Template for Canada

A comprehensive legal agreement governed by Canadian federal and provincial laws that establishes the terms and conditions of the commission arrangement between a real estate professional (agent or broker) and their client (typically a property seller or buyer). The document outlines the commission structure, payment terms, scope of services, and obligations of both parties while ensuring compliance with provincial real estate regulations and federal requirements. It includes specific provisions for commission calculations, payment triggers, and the duration of the agreement, while incorporating necessary consumer protection elements and regulatory compliance measures required under Canadian law.

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What is a Commission Agreement (Real Estate)?

The Real Estate Commission Agreement (Real Estate) serves as the foundational document for establishing professional relationships between real estate agents/brokers and their clients in Canada. This agreement is essential for any real estate transaction where commission-based services are provided, whether for residential or commercial properties. It must comply with both federal Canadian laws and provincial real estate regulations, including specific requirements set forth by provincial real estate councils. The document typically includes commission rates, payment conditions, service scope, and protection periods, while ensuring alignment with provincial consumer protection laws and real estate industry standards. It's particularly important for establishing clear financial terms and protecting both parties' interests throughout the property transaction process.

What sections should be included in a Commission Agreement (Real Estate)?

1. Parties: Identification of the real estate agent/broker and the client (seller/buyer)

2. Background: Context of the agreement and brief description of the property transaction

3. Definitions: Key terms used throughout the agreement including 'Commission', 'Property', 'Closing Date', etc.

4. Appointment and Authority: Formal appointment of the agent/broker and scope of their authority

5. Term of Agreement: Duration of the agreement, including start and end dates

6. Services to be Provided: Detailed description of services the agent/broker will provide

7. Commission Structure: Details of commission rates, calculation methods, and payment terms

8. Payment Terms: When and how commission payments will be made, including any conditions

9. Agent's Obligations: Specific duties and responsibilities of the agent/broker

10. Client's Obligations: Specific duties and responsibilities of the client

11. Representations and Warranties: Standard declarations by both parties about their capacity and authority

12. Termination: Conditions and process for ending the agreement

13. Confidentiality: Protection of confidential information shared during the engagement

14. General Provisions: Standard legal clauses including governing law, notices, and amendments

What sections are optional to include in a Commission Agreement (Real Estate)?

1. Multiple Listing Service: Terms regarding MLS listing services when applicable

2. Post-Termination Obligations: Commission obligations that survive after termination (for protected period)

3. Marketing Services: Detailed marketing plan and associated costs when specific marketing services are included

4. Digital Marketing: Specific terms for online marketing and virtual tours if offered

5. Team Structure: When multiple agents will be involved in the transaction

6. Property Management: For agreements including property management services

7. Dispute Resolution: Alternative dispute resolution procedures if preferred over standard litigation

8. International Considerations: For transactions involving international clients or properties

9. Force Majeure: Provisions for unforeseen circumstances affecting performance

What schedules should be included in a Commission Agreement (Real Estate)?

1. Schedule A - Property Details: Detailed description of the property including address, legal description, and specific features

2. Schedule B - Commission Rate Structure: Detailed breakdown of commission rates and calculations

3. Schedule C - Marketing Plan: Detailed marketing strategy and timeline

4. Schedule D - Service Level Agreement: Specific performance metrics and service standards

5. Appendix 1 - Required Disclosures: Mandatory disclosures required by local real estate regulations

6. Appendix 2 - Agency Disclosure: Standard form explaining agency relationships

7. Appendix 3 - Fee Schedule: Breakdown of any additional fees or costs beyond commission

8. Appendix 4 - Contact Information: Complete contact details for all relevant parties

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Canada

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions





























Clauses


































Relevant Industries

Real Estate

Property Development

Property Management

Commercial Property

Residential Property

Property Investment

Real Estate Brokerage

Property Services

Relevant Teams

Legal

Compliance

Real Estate Sales

Business Development

Contract Administration

Property Management

Transaction Processing

Risk Management

Operations

Relevant Roles

Real Estate Agent

Real Estate Broker

Property Manager

Real Estate Sales Representative

Compliance Officer

Legal Counsel

Real Estate Transaction Coordinator

Sales Director

Business Development Manager

Contract Administrator

Real Estate Agency Owner

Property Developer

Real Estate Investment Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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