Jul 01, 1986

Court – Can It Review a Board’s Decision to Penalize a Member #88

Jul 01, 1986

Court – Can It Review a Board’s Decision to Penalize a Member #88

By Gerry Neely
B.A. LL.B.

Have you ever wondered what your remedy would be if your Board imposed a penalty upon you that you thought was unfair because, in your opinion, it was based upon a wrong interpretation of the facts of the complaint made against you. Could you apply to a Judge to have him decide whether the finding against you was justified? Might the Canadian Charter of Rights help you?

These questions arose in connection with fines levied against a real estate broker who was a member of the Winnipeg Real Estate Board. The Professional Standards Committee of the Board had decided that a "commission reduction plan" advertised by the member was a breach of the Rules and Regulations, Code of Ethics and Standards of Business Practice of the Board. The member advertised an arrangement under which purchasers of properties listed with the member under the Board's MLS® would, with the agreement of the vendor, be given a reduction in the purchase price paid by the purchaser. The reduced purchase price was based upon a formula that led to a reduction in the usual commission payable to the vendor, with the reduction being passed on to the purchaser.

The broker applied to the court for an order that the fines be set aside. The principal argument was that the Professional Standards Committee had proceeded on a wrong principle in holding that the scheme was illegal.

The Board responded to this argument by saying that the court had no jurisdiction to examine the proceedings and the decision taken by the Professional Standards Committee. As we know, decisions taken by a statutory commission or tribunal, such as the Motor Carrier Commission, are subject to review by the court. The reason for this is that the Motor Carrier Commission is established by a Provincial public statute for the purpose of protecting the public. Since the Motor Carrier Act gives the Commission a duty to regulate and discipline, then the court has the power to review its decisions.

Unlike the Motor Carrier Commission, the Boards within British Columbia are not created by a public statute, even though they are incorporated under the Society Act. They function only as a regulatory body for private citizens who are its members. Therefore, as a voluntary and private organization, the decisions of the Ethics Committee or of the Professional Standards Committee are not subject to review by the courts.

Losing on this point, the broker then argued that his inability to continue to advertise his scheme meant that his rights of freedom of expression guaranteed under the Canadian Charter of Rights had been violated.

The question to be settled here was whether the Charter only governed rights and liberties as between subjects and their governments, or did it also determine rights between private citizens and private corporations. The judge accepted the general view that the Charter of Rights was intended only to regulate the relationship of an individual with the government by invalidating laws and governmental activity which infringed upon the rights guaranteed by the Charter.

The judge then held that since the member's complaint involved a "private" as opposed to a "government" action, the Charter did not apply to give the court the power to set aside the actions of the Winnipeg Real Estate Board.

Unless the member can establish to the court's satisfaction that the Board failed to follow its own rules and regulations, or that there was a denial of natural justice, the Board's decision is final and it is binding upon the member.

  1. Peg-Win Real Estate Ltd. v. The Winnipeg Real Estate Board, In The Queen's Bench (Manitoba) Suit No. 84-01-04767.

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