Anonymised, illustrative composite. An agent moving brokerages assumed four active listings would simply move with them. The representation agreements were never the agent's to move.
At a glance
An Ontario agent working under a team's brand at one brokerage decided to move to a different brokerage, for a better split. At the time of the move, the agent was the designated representative on four active seller listings, combined list price $3.1 million, at various stages between initial marketing and pending offers.
The agent assumed the listings would simply come along — the sellers knew and trusted them personally, not the brokerage's name on the sign. But a representation agreement is, by RECO's own description, a contract that names the brokerage as the party bound to the client, with a specific individual named as designated representative where applicable — not a contract between the client and the individual agent. Changing brokerages does not carry an existing listing agreement along; the agreement stays where it was signed unless the client agrees to end it and start a new one.
At an agreed 2.5% listing side, the four files represented roughly $77,500 in projected commission if all four closed with this agent representing the sellers. Only one of the four sellers was willing to formally terminate the existing agreement with the old brokerage and sign fresh with the agent's new one — that file, worth about $19,375 of the total, moved cleanly. The other three sellers, either because they were mid-negotiation on live offers or simply didn't want the disruption of restarting paperwork, stayed represented by the old brokerage, which assigned a new designated representative internally to finish them. Those three files, roughly $58,125 of projected commission, closed under the new representative's name, not the departing agent's.
The rule that decided the split wasn't loyalty or client relationship strength — it was who the written agreement actually bound. RECO's own description of a representation agreement's required contents includes “all circumstances when the agreement can be terminated,” which means termination is a negotiated, documented step, not an automatic consequence of the agent changing brokerages. For the one seller who did move over cleanly, the old brokerage's willingness to release the file mattered as much as the seller's wish to follow the agent — without that release, even a willing seller stays bound to the original agreement's terms, including any holdover clause covering a deal that completes after the agreement ends.
The one released file transferred cleanly to the new brokerage with a fresh representation agreement signed the same week. The other three stayed with the old brokerage's newly assigned designated representative, who inherited the files mid-transaction and completed them; that representative, not the departing agent, earned the commission split on those closings. The departing agent's new brokerage relationship started clean on the one file, but the agent had priced the move assuming all four would transfer, not one.
Nothing about this outcome was avoidable after the fact — representation agreements simply don't move with an agent by default, regardless of the client relationship. The real cost sat in the planning, not the execution: an agent weighing a brokerage move who assumes every open file transfers is pricing the move against $77,500 in projected commission that was never guaranteed to travel. Confirming, file by file, which sellers were both willing and able to formally release the old brokerage before committing to a move date would have priced the decision against the real number — roughly $19,375 confirmed, not $77,500 assumed — before the move, not after.
The tell was in the paperwork the agent never checked before deciding to move: whose name is actually on each representation agreement, and what that agreement says about termination. A five-minute review of the four listing files, reading the termination clause on each one rather than assuming the client relationship settled the question, would have shown which files were realistically moveable before the brokerage change was ever announced to the sellers. The team's broker of record at the old brokerage confirmed the same thing from the other side once asked — and the same question, this time about a written team split rather than a listing agreement, is what a team split nobody wrote down turns on.
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