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The Arbitration Policy and Process



Application of Policy 

The Arbitration Policy sets out the process that will be followed for all commission and fee disputes.  

It is important to point out that the policy applies to all users of the ITSO MLS® System - not just REALTORS® that belong to your Association.  So if you are involved in a dispute with any other brokerage that is using the ITSO MLS® System, then you can submit the dispute to ITSO for resolution pursuant to this policy.


Another important thing to note is that the Arbitration Policy forms a binding arbitration agreement among parties to a dispute. Brokerages are required to submit commission disputes to arbitration for resolution pursuant to Article 24 of the REALTOR® Code, which provides as follows:


In the event of a dispute between REALTORS® associated with different brokerages of the same local Board/Association regarding the Compensation earned or to be earned in connection with a real estate transaction, the dispute shall be submitted for arbitration in accordance with the By-Laws, Rules and Regulations of their local Board/Association. 


This means that you are not permitted to file an action in court regarding a commission dispute unless you and the other party agree not to enter into arbitration and you notify the Professional Standards Manager of that agreement.


Policy Overview

The Arbitration Policy starts by setting out the Claim process.  When a Claim is submitted to ITSO , the Professional Standards Manager will review the Claim, ensure all the required information is included as well as the filing fee, and will determine if ITSO has jurisdiction over the dispute.  Interprovincial disputes, for example, would go through the arbitration process at the Canadian Real Estate Association instead of ITSO .  A Claim involving two salespeople at a single brokerage would be another example of a dispute that would not fall under the jurisdiction of ITSO's Arbitration Policy.  Some Member Associations are enforcing this policy at their Association and so you might be directed to file the Claim directly with your Association.


If the Claim falls under ITSO's jurisdiction then the Professional Standards Manager will provide a copy of the Claim to the Respondent so that they can file a Response. 


Once a Response has been filed then the matter will be referred to a mediator.  The policy sets out that all parties to a Claim are required to attempt to resolve the dispute through mediation first before resorting to arbitration.  A ITSO director will be appointed as a mediator.  The goal is to try to resolve more disputes faster, more amicably, in a less formal setting.  


If a dispute cannot be resolved by mediation, then it will proceed to arbitration. The Chair of the Arbitration Committee will select a panel of arbitrators to hear the dispute.  The policy then sets out the procedures that will be followed for an arbitration hearing. After the hearing, the panel members will deliberate to arrive at a conclusion and the decision will be delivered to the parties to the dispute. 


The policy then sets out the procedures for appealing an arbitration award.  Most of the process for appeals is handled at the Ontario Real Estate Association (OREA), but the Professional Standandards Manager will coordinate with OREA to provide information on the proceedings up till that point.  The policy provides that once an appeal decision is made, it is final and binding on the parties.


A full copy of the Arbitration Policy can be found above.


Filing a Claim


If you are involved in a commission dispute then you might want to file a Claim with ITSO.  Here are a couple things to consider before filing the Claim.  First, only brokerages can be parties to a commission dispute as they are the entity that commissions are payable to.  If you are a salesperson, then you’ll need to get your brokerage to file the Claim.


Secondly, keep in mind that there is a filing fee of $1000.  If the fee or commision in question is less than $1000, then you may want to try to resolve the matter informally.  If you end up filing a Claim with ITSO, and if the matter is resolved at mediation, then you may get the filing fee back.  The Chair of the Arbitration Committee will decide how much of the filing fee is to be retained by ITSO to offset the costs of the proceedings.


Third, consider when the circumstances arose that gave rise to the claim.  The Arbitration Policy provides that a Claim can only be filed if it is done within 180 days of those circumstances.


If you decide to file a Claim then you need to include all the required information:


  • A filing fee of $1000+HST;

  • The amount in dispute or the basis on which the amount is to be calculated; 

  • A detailed statement of all facts relied on to support the Claim; 

  • All supporting documentation; and

  • An undertaking of the Claimant to be subject to and to abide by the decision of the Arbitration Panel.


Be specific in the Claim.  For example, you wouldn’t want to say that you are owed 2% of the commission.  Calculate how much 2% is of the sale price and include that information in your Claim, as well as any documents you have to support the calculation.  Remember that the information in the Claim will be used by the mediator to try and resolve the dispute, so include all the evidence you want to rely on.


Also keep in mind that the Respondent will be provided with a copy of the Claim.  For that reason you will want to stick to setting out facts in the Claim and keep the language you use professional.


A Claim for can be found above. Completed Claims can be sent to 


Filing  Response


If you are the subject of a Claim then you will want to file a Response with ITSO.  The Response must be provided to the Professional Standards Manager within 10 days of receiving a copy of the Claim.  A Response is required to include:


  • A statement of those allegations in the Claim which are admitted, those which are denied, and those of which the Respondent has no knowledge; 

  • A detailed explanation of the facts relied on by the Respondent to support the Response;

  • All supporting documentation; and

  • An undertaking of the Respondent to be subject to and to abide by the decision of the Arbitration Panel. 


The same guidelines for filing a Claim apply here as well.  Be specific in your Response, include all the evidence that you want the mediator to consider, and be professional.  A copy of your Response will be provided to the mediator and to the Claimant.




The mediator will contact both parties to try and informally resolve the dispute.  The mediator will decide what steps they want to take to try and arrive at a resolution, which may include meetings held by electronic means or in person.  Lawyers are not permitted to attend mediation meetings as the involvement of lawyers tends to make things adversarial, which is contrary to the goal of mediation.  The entire purpose of mediation is to arrive at an amicable solution that is acceptable to both parties. That said, even though lawyers are not permitted to attend mediation meetings, you could consult a lawyer before the meeting.  


Keep in mind that everything said during mediation is completely confidential.  If the matter ends up going to arbitration then nothing said during mediation can be raised at the arbitration hearing, and the mediator cannot be required to attend or testify at an arbitration hearing.  The confidentiality of mediation discussions is intended to encourage an open and honest discussion about the dispute, which could help arrive at a resolution.


At some point the mediator may make recommendations as to how the dispute could be resolved.  The recommendations themselves are not binding.  However, if you and the other party agree on a resolution, then the mediator will draft a settlement agreement.  An executed settlement agreement will end the proceedings, and is a binding contract that can be enforced by a court of law.




If an agreement cannot be reached at mediation then the matter will be referred to the Arbitration Committee.  Both parties will receive a Notice of Hearing, which will include a number of things that you will need to review:


  • The date and time of the hearing;

  • The location of the hearing;

  • The Claim; 

  • The Response if there is one; 

  • The names of the committee members on the Arbitration Panel; and 

  • Copies of relevant policies and procedures or links to where they may be found.


Make sure you look at who will be sitting on the Arbitration Panel.  If you wish to object to any of those panel members because you believe there is a reason they will be biased then you will need to notify the Professional Standards Manager within 5 days of receiving the Notice of Hearing. 


Think about how you are going to present your case at the hearing.  You’ll be able to testify to provide oral evidence and introduce documentary evidence.  You may also want to call witnesses to help prove your case.  If you choose to call witnesses then it is your responsibility to ensure they are aware of the date and time of the hearing and are able to attend.


If the date of the hearing does not work for you either because you are unable to attend or one of your witnesses is unable to attend, then again you must notify the Professional Standards Manager as soon as possible.  


You’ll have 10 days after receiving the Notice of Hearing to provide the names of your witnesses, if any, and all documentary evidence to the Professional Standards Manager that you wish to introduce at the hearing.  This will likely be all the documents you relied on when filing your Claim or Response.  You’ll receive the hearing package at least 7 days before the hearing, which will include all the documentary for both parties as well as the names of the witnesses.  Make sure you review the package so that you can prepare your arguments for the hearing.


Once you have done that, you’ll need to decide if you want to be represented at the hearing by a lawyer or someone else that you trust to advance your position.  If you are going to be represented by a lawyer then you must notify the Professional Standards Manager at least 5 days before the hearing.


The Hearing


The hearing will proceed in the following order:


  • Chair makes opening remarks;

  • Introduction of the Arbitration Panel and confirmation of no conflicts;

  • Swearing in of Parties and witnesses;

  • Witnesses leave room;

  • Claimant presents evidence and calls witnesses if any;

  • Cross examination from Respondent;

  • Respondent presents evidence and calls witnesses if any;

  • Cross examination from the Claimant;

  • Questions from Arbitration Panel;

  • Closing statement from Claimant;

  • Closing statement from Respondent.


The Claimant will go first as the onus is on them to prove to the arbitration panel that they are entitled to the fee or commission in question.  They have to introduce clear, convincing evidence of this fact.


Both parties should be polite and professional during the proceedings.  When questioning your own witnesses you are not permitted to ask leading questions (i.e., isn’t it true that I showed you the property in question?).  Try to ask open ended questions that allow witnesses to tell their story (e.g., tell me what happened on July 3, 2020).


Another thing to keep in mind is the restriction on hearsay evidence, which is something that you do not have first hand knowledge of (e.g., my neighbour told me they saw a black cat).  Arbitration panels are not bound by the rules of evidence, but hearsay evidence does not give the other party at a hearing the chance to question the person who actually saw or said the thing being introduced.  The Arbitration Policy prohibits hearsay evidence for that reason.  You should avoid introducing hearsay evidence for that reason, and be prepared to object if the party attempts to introduce evidence that may be hearsay.


You are entitled to request an adjournment during the hearing if you need a break or a few minutes to collect your thoughts.  Just keep in mind that it is up to the arbitration panel to decide whether or not to allow the adjournment.  If you are asking for an adjournment for a frivolous reason that will simply prolong the proceedings, then the panel might not allow your request.


Once the hearing is over you, the other party, and any witnesses that testified will all be excused.  The arbitration panel will stay to deliberate and a copy of their decision will be provided to you by the Professional Standards Manager as soon as possible.


Appeal Applications


Once you receive the appeal panel decision you’ll need to decide whether or not you want to appeal.  There are only two  acceptable grounds for appeal, which are:


  • That there was a denial of natural justice; or

  • The Arbitration Panel did not have jurisdiction to make the arbitration award.


The facts as determined by an arbitration panel are assumed to be true.  You cannot file an appeal based on an error of fact.  Further, if you do choose to file an appeal application, keep in mind that you will not be permitted to introduce new evidence at the appeal hearing.  


If you decide that you have grounds to appeal, then you’ll need to submit your appeal application to OREA within 30 days of receiving the arbitration panel’s decision.  The appeal application will need to be in the form required by OREA (set out in Schedule B to the Arbitration Policy) and accompanied by the filing fee established by OREA.


When OREA receives an appeal application then will provide a copy of the application to the Respondent.  They will then be given at least 15 days to file a Response with OREA.


Preparing for the Appeal Hearing


OREA will then provide both parties with a Notice of Appeal, which will be provided to you at least 30 days before the date of the appeal hearing.  The Notice of Appeal will include:


  • The Arbitration Hearing Package;

  • A transcript of the Arbitration Hearing; and 

  • The decision from the Arbitration Panel.


You’ll need to decide if you are going to be represented at the appeal hearing.  If either Party will be represented by a lawyer they must notify OREA and the other Party at least 5 days prior to the appeal hearing.


Appeal Hearing


The hearing will be held pursuant to OREA’s procedures.  After the hearing the decision will be provided to both parties.  This decision is final and binding and will be communicated to you as soon as possible after the appeal hearing.


Summary of Important Time Frames


Claim and Response

  • Claim must be filed within 180 days of the circumstances giving rise to the Claim arose

  • Response must be filed within 10 days of receiving the Claim


Arbitration Hearing 

  • Object to hearing panel member or request hearing postponement no more than 5 days after receiving notice of hearing

  • Provide documentary evidence and names of witnesses to Professional Standards Manager within 10 days of receiving notice of arbitration hearing

  • Notify Professional Standards Manager that you will be represented by a lawyer at least 5 days prior to arbitration hearing



  • File appeal application no more than 30 days after receiving the hearing panel decision

  • Notify OREA and the other party that you will be represented by a lawyer at least 5 days prior to appeal hearing

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