Her omission misled prospective buyers and created potential harm for her clients: court
The Ontario Superior Court of Justice dismissed a real estate agent's judicial review application challenging a decision that found her in breach of the Code of Ethics for listing inaccurate property taxes and local improvement charges.
Darrah Smith challenged a decision by the Real Estate Council of Ontario (RECO), which found her in breach of the professional Code of Ethics. Smith listed a property in Georgina in 2017, stating the annual taxes were $3,554.32 and that the local improvement charge was paid in full.
The actual taxes, including a local improvement charge of $796.40 annually, totalled $4,183.59. Despite multiple requests, Smith never received a tax bill from the property owners. She calculated the property taxes based on available data and added a disclaimer for buyers to verify the taxes and measurements, which was only visible to real estate brokers.
The discipline panel of RECO found that Smith violated several provisions of the Code of Ethics, including failing to treat all parties fairly and honestly, and not providing conscientious service. Smith appealed the decision, but RECO's appeal panel upheld the original findings.
Smith sought judicial review on three grounds. First, she argued that the discipline panel unreasonably excluded expert testimony regarding local improvement charges and real estate agents' difficulties in confirming such charges. Second, she contended that the panel unreasonably prohibited one of her experts from testifying as a fact witness about his practices. Third, she claimed that the decision that she breached the Code of Ethics by including inaccurate tax information was unreasonable, given her efforts to verify the information.
The Superior Court upheld the appeal panel’s decision, finding the panel's reasoning and outcome reasonable. The court noted that the discipline panel excluded Smith’s expert witnesses because their evidence was unnecessary and too close to the ultimate issue the panel had to decide. The expert opinions focused on whether Smith acted diligently, which the panel found was within its expertise to judge.
The court also found the discipline panel acted within its discretion in excluding Smith's proposed fact witness, determining the testimony irrelevant to whether the listing was misleading. The court agreed with the discipline panel that Smith did not communicate that the tax information was based on her calculations and not verified. This omission misled prospective buyers and created potential harm for her clients. The court found that the disclaimer, visible only to brokers, was insufficient.
The court dismissed Smith's application for judicial review and ordered her to pay $4,000 in costs to RECO.
