A real estate agent who misled buyers about competing offers was taken to court, and the judge ruled against her, resulting in a $28,600 damages award. The case is a cautionary tale for agents about how a little ‘creative marketing’ can quickly turn into a very expensive lesson.

Facts of the case

In 2020, Ms. Tran, an experienced real estate agent, was selling her house. She first listed it for $1.5 million, but the best offer she got was $1.25 million, which was too low for her liking. So, she delisted the property, then relisted it a month later at $1.25 million, hoping to spark a bidding war.

When potential buyers came along, Ms. Tran told them she had two other registered offers. In reality…there were no other offers. The buyers, thinking they were competing in an auction, raised their bid to $1.305 million, which Ms. Tran accepted. After the sale, the buyers discovered that no other offers actually existed and, feeling misled, took Ms. Tran to court over her misrepresentations.

What the court ruled

The court found that Ms. Tran had misled the buyers with false statements about other offers. Under the law, a registered offer must be in writing. Oral back and forth or “verbal puffery” doesn’t count. The judge also looked at whether Ms. Tran might have accepted a lower offer if negotiations had continued, and concluded she likely would have. Applying the “loss of opportunity” principle, the court calculated damages at $28,600 – a fair midpoint between what the buyers initially offered and what they ended up paying due to the misrepresentation. Click here to read the full ruling in Tran v. Brickman, 2025 ONSC 4341.

Takeaways for Real Estate Agents

1. Honesty is the best policy (and the cheapest). Claiming phantom offers might drum up higher bids, but it can also create a hefty legal bill.
2. Offers must be in writing. No matter how common verbal back-and-forth is in your market, it doesn’t count as a registered offer under the law.
3. Transparency wins. Don’t invent competing buyers or deadlines; it’s not worth the risk.
4. Document everything. Keep a paper trail of all offers and negotiations. It’s your best defense if a deal goes sideways.

Imaginary bids may sell houses in your head, but in court, reality always wins, and your wallet may feel the pinch if you forget it.

Michael Abrams
Certified as a specialist in Real Estate by the Law Society of Ontario