Ontario Superior Court of Justice

Court File No.: CV-21-2113
Date: 2025-05-23

BETWEEN:
Intercity Realty Inc., Brokerage (Plaintiff)
– and –
Salerno Realty Inc., Brokerage, Steven T. Cardwell and Re/Max West Realty Inc. (Defendants)

Appearances:

• Emilio Bisceglia, for the Plaintiff
• Jonathan Piccin, for the Defendant, Salerno Realty Inc.
• No one appearing for the Defendants, Steven T. Cardwell and Re/Max West Realty Inc.

Heard: March 26, 2025

Justice S.E. Fraser

I. Overview

[1] The Defendants, Salerno Realty Inc., Brokerage (“Salerno”) and Re/Max West Realty Inc. (“Re/Max”), each brought a motion to dismiss the Plaintiff’s action and other relief.

[2] At the hearing of the motion, the Plaintiff advised that it has resolved the matter with Re/Max such that only the Defendant Salerno’s motion was proceeding.

[3] Salerno applies for a dismissal of this action under Rule 21(3)(a), arguing that this Court has no jurisdiction over the subject matter. In the alternative, Salerno seeks a dismissal under Rule 25.11, asserting that the claim is frivolous, vexatious, and otherwise an abuse of process as the matter has already been determined by an arbitral award.

[4] Further, Salerno seeks an order requiring the co-defendant Re/Max to comply with the arbitral award and release commissions to Salerno in the amount of $52,782.30.

[5] By way of background, Mr. Cardwell was employed by Intercity as a salesperson and registered as such under the Real Estate and Business Brokers Act, 2002, S.O. 2002, c.30 (“REBBA”). While employed, he bought a house listed by Salerno and Re/Max (“the property”). Intercity claims that by virtue of the employment relationship, the Multiple Listing Agreement, and the operation of REBBA, it acted for Mr. Cardwell in the purchase, was therefore a co-operating brokerage, and is entitled to share in the 2.5% buyer’s commission on the sale of the property which has not been paid out.

[6] Intercity’s action is for breach of contract.

[7] Intercity pleads in its Statement of Claim that “if the Commission is not due and owing under the Listing Agreement, it is only not due and owing because the Defendant Cardwell did not properly execute a co-representation agreement . . . and/or otherwise waived or prejudiced Intercity’s rights to the Commission”.

[8] Salerno argues that Intercity pursued its claim for commission at arbitration through the Toronto Regional Real Estate Board (“TRREB”) arbitration process. The TRREB requires its members under its bylaws to submit any commission disputes to arbitration. The TRREB received and heard Intercity’s complaint. A hearing panel determined that Intercity was not entitled to commission. This decision was upheld on appeal.

[9] Salerno further asserts that the arbitral award was final and that this action is therefore an abuse of process.

[10] I find that this Court does not have jurisdiction to deal with this matter for the reasons set out below.

II. Issues

[11] The issues on this motion are:

a. Does this Court have jurisdiction to consider Intercity’s claim?
b. Is Re/Max required to release a commission in the amount of $52,782.30 inclusive of HST to Salerno?
c. Is this action frivolous, vexatious or otherwise an abuse of process such that it ought to be dismissed as such under Rule 25.11?

III. Analysis

[12] In this analysis, I briefly set out the facts relating to the procedural history before examining the issues on this motion.

A. Proceedings before the TRREB

[13] Intercity commenced this action and then complained to the TRREB. The TRREB Arbitration Claim Form claimed only as against Re/Max. However, the Plaintiff’s email to the TRREB of the same date, which set out the details of the complaint, stated:

Intercity Realty Inc., Brokerage (“Intercity”) would like to advance a complaint against Salerno Realty Inc. … and Re/Max West Realty Inc. … to the Toronto Regional Real Estate Board (“TRREB”) in violation of the MLS Rules and Policies and Code of Conduct based on the following: Re/Max and Salerno Realty Inc. were the listing and co-listing brokers/agents respectively for the property known municipally as 2 Winterlude Court, Vaughan, Ontario (the “Property”).

[14] The allegations in the TRREB claim are the same as those advanced in the Statement of Claim in this action except that Mr. Cardwell and Salerno were not parties to the complaint.

[15] Salerno attempted to be added as a party to the TRREB claim but this request was denied by the TRREB. Salerno asserts on this motion that Re/Max assured him that its interests would be protected.

[16] The TRREB Arbitration Guidelines provide that:

By virtue of the By-Law, all members have agreed to submit all claims to Arbitration as provided for in the By-Law, and the Hearing Panels are given exclusive jurisdiction to hear or settle all Claims, with the exception of Claims where both parties have agreed in writing to have their Claims resolved in another forum. No legal action or other proceeding shall be taken by any Member with regards [to] the subject matter of a Claim, except as previously mentioned.

[17] The TRREB Arbitration took place on March 31, 2022 and the decision, the arbitral award, was released on April 4, 2022.

[18] At arbitration, Intercity sought a commission of $131,955.75 inclusive of HST. The parties, Re/Max and Intercity, agreed in writing to abide by the decision of the TRREB Arbitration. Intercity did not name Salerno as a respondent to the arbitration claim and Salerno’s attempts to be added were unsuccessful. Salerno states that Re/Max represented its interests. The record supports this.

[19] The Hearing Panel held that Mr. Cardwell purchased the property as an individual and not in his capacity as a salesperson for Intercity. The hearing panel stated that this was supported by a Buyer’s Representation Agreement signed between Mr. Cardwell and Salerno and a Confirmation of Co-operation and Representation.

[20] The Hearing Panel noted that Mr. Cardwell had signed a Form 160 which is a Registrant’s Disclosure of Interest Form. Intercity argued before the Hearing Panel that it was invalid as it was unilaterally signed by Mr. Cardwell and Intercity did not agree to waive the Co-operating Brokerage Commission.

[21] The TRREB Hearing Panel held that:

There is no dispute that Mr. Cardwell completed the transaction while he was associated with Intercity. The Hearing Panel acknowledges the Claimant’s position pertaining to the invalidity of the of Form 160 as it is unilaterally signed by Mr. Cardwell without the authorization from Intercity.

It is not in this Hearing Panel’s purview to interpret and apply an employment relationship between a salesperson and his or her brokerage. On this basis, internal office disputes pertaining to office policies and employment contracts in any form are outside the scope of this Hearing Panel and do not influence. Accordingly, any breach of Mr. Cardwell's employment contract with Intercity pertaining to the purchase of a property with another brokerage is outside of the Hearing Panel's jurisdiction.

[22] The hearing panel concluded that Intercity had not proven that it was a party to the transaction and ordered Re/Max to retain the commission for disbursement to Salerno. It dismissed Intercity’s claim against Re/Max West Realty Inc. and held that the Board’s findings were final and binding among the parties to the Arbitration Award.

[23] On October 5, 2022, an appeal panel upheld the decision of the hearing panel.

B. Jurisdiction of this Court

[24] Rule 21(3)(a) provides that a defendant may move before a judge to have an action stayed or dismissed on the ground that the court has no jurisdiction over the subject matter of the action.

[25] As a court of inherent jurisdiction, this Court has jurisdiction over every conceivable claim unless (i) the claim does not disclose a reasonable cause of action or (ii) the jurisdiction has been removed by legislation or by an arbitral agreement: TeleZone Inc. v. Canada (Attorney General), 2008 ONCA 892, para 92, aff’d 2010 SCC 62. For jurisdiction to be ousted, it must be clear and unequivocal the jurisdiction has been ousted. See Skof v. Bordeleau, 2020 ONCA 729, paras 8-9.

[26] The Defendant Salerno argues that the dispute between it and the Plaintiff is about commission. As real estate brokerages, at the relevant time, they were subject to the Real Estate and Business Brokers Act, 2002 and Code of Ethics. As noted above, the TRREB’s Arbitration Guidelines require its members to submit to arbitration to resolve commission disputes. Both the Plaintiff and Salerno are members of the TRREB and therefore subject to the TRREB’s arbitration by-laws.

[27] In my view, Intercity was required under the terms of its membership to bring an arbitration claim which it did. The Plaintiff argues that Salerno was not a party to the Arbitration Award. It matters not that Salerno was not a party as the decision binds Salerno because it directs Re/Max to hold the commission for Salerno and all the issues relating to Salerno were dealt with at arbitration.

[28] I therefore find that this Court has no jurisdiction over the dispute between Intercity and Salerno as its jurisdiction has been ousted by virtue of the TRREB’s Arbitration Guidelines binding its members.

[29] I therefore dismiss Intercity’s action as against Salerno and it follows that Re/Max shall release to Salerno the commission as directed by the Hearing Panel.

C. Issue Estoppel

[30] I now address whether this matter is an abuse of process under Rule 25.11 by way of issue estoppel in the event that I am wrong about the jurisdictional question.

[31] Issue estoppel operates to prevent the re-litigation of matters already decided by the parties and their privies. The question alleged to be estopped must have been fundamental to the decision in the earlier proceeding. It must extend to the material facts and conclusions of law, or mixed fact and law that were necessarily determined in the earlier proceedings. See Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44, paras 24 and 25.

[32] The parties agree that the applicable test is set out in Danyluk such that I must examine the TRREB decision to determine whether:

a. that the same question has been decided;
b. the TRREB decision was final; and,
c. the parties to the TRREB decision or their privies were the same persons as the parties as in this proceeding in which the estoppel is raised.

[33] In my view, the issue as between the Plaintiff and Re/Max and Salerno has been fully adjudicated through the TRREB. Re/Max represented Salerno’s interests before the TRREB hearing panel. The TRREB hearing panel was final.

[34] The Plaintiff argues that the Hearing Panel’s decision concerns the listing agent Re/Max and not Salerno as it was not a party to the litigation. In my view, Salerno’s interests were represented through Re/Max. The question decided by the Hearing Panel is the same question before this Court. The decision was final.

[35] I find that the Plaintiff is estopped from bringing this claim against Salerno as the matter has been finally litigated and that its attempt to re-litigate the claim in this Court constitutes an abuse of process. I would dismiss the claim on this basis had I not found that this Court was without jurisdiction.

IV. Disposition

[36] Salerno’s motion is granted. The action against it is dismissed. This decision does not impact Intercity’s claim against the Defendant Mr. Cardwell.

[37] If the parties are unable to resolve costs, I will decide the costs by way of written submissions. Salerno shall provide written costs submissions limited to two double-spaced pages exclusive of any offers and Bill of Costs by May 30, 2025. Intercity shall provide its written submissions subject to the same limits by June 10, 2025. There shall be no reply without leave. They shall be filed through the portal, uploaded to Case Center, and a copy sent to my Judicial Assistant Robyn Pope at Robyn.Pope@ontario.ca.

Justice S.E. Fraser
Date: May 23, 2025