Hidden defects when buying or selling a home
PHOTO BY TARA FITZGERALD
Judging by the extent of the damage the exterminator was able to establish that this nest of Carpenter ants had been present for at least two years.
Buying a new home is an exciting event but also one that can quickly turn happiness to frustration when things go wrong. The discovery of a hidden defect in a newly purchased home is a crushing disappointment for the buyer but can also be a terrible surprise for the vendor as well.
According to the Organisme d'autoréglementation du courtage immobilier du Québec (OACIQ), "A latent defect is an unapparent problem that existed at the time of purchase but you have not been informed about it; and it is so serious that you would probably not have bought the property or would have asked for a price reduction.”
The OACIQ suggests a pre-listing inspection can help a vendor be as accurate as possible when filling in their seller’s declaration, a document that exists so that both the vendor and the buyer are protected. A good real estate broker will impress upon a vendor that the more transparent they are with the declaration on their property the less problems they will incur post sale.
PHOTO BY CARMEN MARIE FABIO
Though not the same locale as the photo at the top, this now abandoned nest shows just how much damage a colony of Carpenter ants can inflict on a 2”x4” joist or stud.
Candis Noble, Real Estate Broker with Engel & Völkers says, “The sellers’ declaration is a serious legal document which should not be taken lightly. This form should always be completed by sellers with the assistance of their broker so they are absolutely clear regarding each declaration. Everything known regarding the property needs to be disclosed. When working with my clients, I make certain to explain to sellers how this document protects them; that it is in everyone’s best interests for them to be fully transparent…because surprises? Well, they cost money.”
Noble also suggests whenever possible to see that you’re supplied with declarations from all previous vendors on the house you’re buying.
“When representing my buyers, not only do I consult the current seller’s declaration but also all previous sellers’ declarations from prior listings to obtain a complete picture; a timeline of sorts regarding the history of the property, its transformations as well as its issues over the years.” Hiring a certified professional building inspector who provides a service contract, utilizes recognized standards of practice, is fully insured, and provides a written report is essential in protecting yourself.
What happens, if despite all the best precautions, your new home has a hidden defect? For example, you discover Carpenter ants that were not detected in a house you bought in the winter?
Éducaloi, an organization dedicated to improving access to justice for Quebecers, warns do not begin repairs on your own if you want to involve the previous owner in paying for damages. The first step to take is to call your broker to discuss the problem and get advice on how they can help. It’s important to note that your broker can only advise you and not assist you with any legal action.
Next, notify the vendor in writing within a reasonable time frame. The norm is six months but could be longer if the problem is only noticeable during a particular season. Your notice or demand letter should include a detailed description of the defect and the resulting damage. Having a letter from a professional who you’ve called to assess the problem is helpful, especially if the letter speaks to the length of time the problem has existed. Finally, Éducaloi also explains that you need to request, “…the seller to respect the guarantee against hidden defects.”
With any luck you and the vendor can come to a mutually acceptable resolution together. If however it isn't possible, a mediator may be used. The government offers free mediation services for this purpose. Be sure to get all the terms agreed upon in writing. If all else fails and the vendor refuses accountability, your last option is to take legal action. If the damage is less than $15,000 you can advocate for yourself in small claims court. It is now possible to file your claim online at Justice Quebec.
For more information on filing a claim, go to www.justice.gouv.qc.ca/en and click on the link for Small Claims.