Executive Summary: Key Legal and Evidentiary Issues

• Under Ontario's Trust in Real Estate Services Act, 2002, only brokerages may employ salespersons, making it legally impermissible for one salesperson to employ another at the same brokerage.
• Central to the dispute was whether Tanya Stanyar's 17-year working arrangement with Stacy Kearley constituted an employment relationship, an independent contractor relationship, or merely a commission-sharing agreement.
• Objective evidence — including emails, industry practice, and Re/Max's own contractual structure — supported only a commission-sharing arrangement, not an employment or contractor relationship.
• Even if an employment relationship had existed, it would have been unenforceable as contrary to statute, since a salesperson cannot lawfully receive remuneration from anyone other than her employing brokerage.
• The plaintiff's alternative argument that she was a dependent contractor failed both procedurally — having not been pleaded in her Statement of Claim — and on the merits, as she provided no financial evidence of economic dependency on the defendant.
• Factual disputes regarding why the defendant ended the working relationship were immaterial, as no legally cognizable employment or contractor relationship was established.

Facts of the case

Tanya Stanyar and Stacy Kearley were both registered salespersons with Re/Max All-Stars Realty Inc., a real estate brokerage in Ontario. Stanyar claimed that she worked for Kearley for approximately 17 years, and that in 2023, Kearley terminated this alleged employment. Kearley denied any such relationship, asserting that both parties were independent contractors who worked together at the same brokerage and shared commissions on listings they handled jointly. Kearley maintained that she stopped working with Stanyar because Stanyar had been harassing her about vaccination-related matters during the COVID-19 pandemic — an allegation Stanyar denied. Kearley brought a motion for summary judgment seeking dismissal of the action.

Regulatory framework

The case turned significantly on the Trust in Real Estate Services Act, 2002, S.O. 2002, c. 30, Sch C (formerly the Real Estate and Business Brokers Act), which governs the registration and conduct of real estate salespersons, brokers, and brokerages in Ontario. Under s. 4(1)(c) of the Act, a salesperson may only trade in real estate as a registrant of a brokerage. Section 31(1) further provides that no broker or salesperson shall trade in real estate on behalf of any brokerage other than the one that employs them, and s. 31(2) prohibits a salesperson from accepting remuneration for trading in real estate from any person other than that employing brokerage. The Act defines "employ" broadly to include both traditional employment and independent contractor arrangements, and "salesperson" as an individual employed by a brokerage to trade in real estate. Ontario Regulation 567/05 contains 32 references to the brokerage as the employing entity, with no provision anywhere in the Act or Regulation contemplating a salesperson employing another salesperson.

Court's reasoning and analysis

Justice Papageorgiou concluded that it is legally impermissible under the Act for a salesperson at a brokerage to employ another salesperson at the same brokerage. The court found that the legislative scheme places the brokerage — not individual salespersons — at the centre of all supervision, accountability, and employment relationships in the real estate industry. Allowing a salesperson to employ another would effectively usurp the brokerage's statutory duty to supervise its registrants and would create a conflicting chain of accountability inconsistent with the Act's consumer protection objectives. The court further held that even if such a relationship had been formed, it would be unenforceable as contrary to statute, relying on Still v. M.N.R. (C.A.), [1998] 1 F.C. 549, for the principle that contracts expressly or impliedly prohibited by statute will not be enforced regardless of the parties' intentions.

On the second issue, the court found that the objective evidence did not support any intention — beyond a commission-sharing arrangement — to form an employment or contractor relationship. Key facts included: a 2008 email in which Stanyar herself described the arrangement as a "partnership"; a 2020 business card prepared by Stanyar identifying both parties as sales representatives for Re/Max; the absence of any written employment agreement despite 17 years of dealings; the fact that Re/Max — not Kearley — paid commissions directly to each agent following a jointly submitted commission split document; and the evidence of Re/Max's broker of record, Ms. Keen, and its sole owner and President, Daniel Sarafian, that commission-sharing among salespersons is a standard industry practice expressly contemplated in Re/Max's agent contracts. The court also noted the absence of any evidence that Kearley controlled Stanyar's hours, holidays, work methods, or day-to-day conduct, and that Kearley provided Stanyar with no tools, desk, or office space. When Kearley decided to stop working with Stanyar, she sought permission from Ms. Keen — conduct inconsistent with that of an employer dismissing her own employee.

The court also rejected the plaintiff's alternative argument that she was a dependent contractor entitled to reasonable notice. The dependent contractor claim had not been pleaded in Stanyar's Statement of Claim, which the court found procedurally improper and unfair to the defendant who had no notice to lead responding evidence. On the merits, the court found that the plaintiff provided no financial evidence — such as tax returns or commission records — to establish that she was economically dependent on Kearley's listings. The defendant's evidence that Stanyar worked with other agents and generated some of her own business was uncontradicted. The court found that any dependency was self-imposed, as Stanyar was free to develop her own brand, obtain her own listings, and earn commissions independently, but chose not to.

Ruling and overall outcome

The court granted the defendant Stacy Kearley's motion for summary judgment and dismissed Tanya Stanyar's action in its entirety. The court determined that no genuine issue requiring a trial existed on either the legal permissibility of the alleged employment relationship or the factual basis for one. On costs, the court encouraged the parties to settle the matter; if unable to do so, it directed the defendant to make costs submissions within seven days, followed by the plaintiff within seven days thereafter. No specific costs amount was determined in the decision.