How to prevent misunderstandings

When buying a property, certain items, such as a living room chandelier, may arouse particular interest. What should you do to make sure this doesn’t become a bone of contention in the transaction? More generally, how can you find out what is included or excluded as part of the sale? These are questions which come up very often and can be major sources of disputes. To prevent this, here is how and when  real estate brokers have an obligation to help their clients under the Real Estate Brokerage Act.

What is always included

Equipment that is an integral part of the immovable, such as heating, electrical and lighting fixtures, is automatically included in the sale in accordance with the Civil Code of Québec. Consequently, it is not necessary to specify these components in the sales contract or the promise to purchase, except if the seller explicitly excludes them from the sale.

Include or excluded: be specific, and negotiate!

• Anything that is not permanently attached to the immovable may be included or excluded as part of the transaction, including an appliance, a wine cooler, a hot tub, blinds, etc.

• The buyer must clearly identify the items you wish to include or exclude in your transactional documents, making sure to specify the colour, brand and serial number.

• The broker must determine with the seller which items the latter wishes to include or exclude when selling his immovable. This information must be entered in the brokerage contract and on the detailed description sheet.

• As a buyer, it is very important to indicate specifically the desired inclusions or exclusions in your promise to purchase.

• To make sure you don’t forget anything, make sure you describe in writing what you wish to keep and pay particular attention to what the other party wishes to include or exclude from the sale.

Some items, such as electric car charging stations, can also lead to confusion as to whether or not they are part of the immovable. To avoid any ambiguity, it is recommended that brokers check with their clients–sellers or buyers–to ascertain their intentions regarding the charging station.

In the case of the walk-in closet, the question as to whether the shelves should have been included depends on how they were attached. If they were attached to the wall, they were part of the property and were included in the sale. If they were removable, they should have been clearly indicated as inclusions in the purchase promise to be able to obtain them.

The real estate broker's duties

In accordance with his professional and ethical obligations stipulated in the Real Estate Brokerage Act and enforced by the OACIQ concerning inclusions and exclusions:

• For the seller

The real estate broker must specify  in detail the inclusions and exclusions under section 4 of the form brokerage contract to sell designed by the OACIQ to protect all the parties involved. In accordance with his obligation to verify, the broker is required to ask the seller if the items included in the sale are in good working order and can be used normally as of the date of delivery. As indicated in the brokerage contract to sell, the items included are sold “without legal warranty of quality, at the buyer’s own risk.”

• For the buyer

The real estate broker must enter all the inclusions and exclusions desired by the buyer on the promise to purchase. The included items must be in normal working order as of the date of delivery of the immovable. In addition, the broker can inform and advise his client regarding the statements on the legal warranty of quality.

Equipment under a lease or bought on credit

Leased equipment or under a credit purchase contract, such as water heaters, monitored alarm systems or heat pumps, are often a source of conflict. Since they are not owned by the seller, in theory he cannot sell them, but sometimes people forget. That’s why the broker must help his client make the necessary verifications.

If the equipment is leased and cannot be transferred to the buyer, the seller’s broker must make sure that this item is excluded from the sale.

However, if the lease contract concerning a piece of equipment allows it, the buyer can take over the contract (equipment remains on premises but the costs are henceforth be assumed by the buyer).

Concerning items bought on credit, the broker must review the contract with the seller or contact the merchant to check if the seller’s obligations can be transferred to the buyer. If so, the broker must describe in detail on the brokerage contract and the promise to purchase the equipment which will be taken over by the buyer.

Questions? Don’t hesitate to contact Info OACIQ.