Commercial immovable or enterprise: What a brokerage contract or transaction proposal must contain

The OACIQ did not develop any mandatory forms for brokerage contracts and transaction proposals involving an immovable containing five dwellings or more, a commercial or industrial immovable, an enterprise¹ or a vacant land.

However, as a regulator, the OACIQ expects licensees to use the recommended forms designed by the OACIQ for some of these transactions whose content complies with the regulations.  This includes the Brokerage contract - Sale of an immovable (BCG) form and the Promise to purchase – Immovable (PPG). Furthermore, in all cases, the broker must obtain minimum declarations from the seller of the immovable. If the broker uses the BCG form, section 8.4 will allow him to fulfil this obligation either because the Declarations by the seller of the immovable (DS) form has been completed, or because the seller has met the basic minimum declarations in this clause.  In the case of a vacant lot, declarations 1 to 10 of clause 8.4 must be completed to the best of the seller’s knowledge.

The OACIQ's recommended brokerage contracts include the following clauses:

1. The names and contact information of the parties;
2. The object and duration of the contract;
3. The identification of the immovable or the characteristics of the immovable sought;
4. The price and conditions for the sale, purchase or exchange of the immovable or enterprise, or for the leasing of the immovable;
5. Agency or broker remuneration method and terms of payment of that remuneration;
6. The possibility for the parties to resort, in case of a dispute, to the services of conciliation, mediation and arbitration offered by the OACIQ in accordance with the Real Estate Brokerage Act;
7. Any other right or obligation of the parties;
8. The statements as to whether the contract is exclusive or non-exclusive, whether it is terminable or not and the description of the enterprise to be sold, if applicable.

If you do not use the OACIQ's recommended forms, your brokerage contract must contain these same clauses, in accordance with the regulator's expectations and with the Real Estate Brokerage Act and its regulations.²

Similarly, in the case of a transaction proposal for the purchase or lease of an immovable comprised of five or more dwellings, a commercial or industrial immovable, an enterprise or a vacant lot, the OACIQ expects that licensees use the recommended forms designed by the OACIQ whose content is consistent with the regulations and which include the following clauses:

1. The names and contact information of the parties;
2. The object of the transaction proposal;
3. The identification of the immovable and the description of the enterprise, if applicable;
4. The price and conditions for the purchase, sale or exchange of the immovable or enterprise or for the leasing of the immovable and, if applicable, the amount of the deposit given in trust to the broker or agency in accordance with the terms and conditions for trust accounting;
5. The mode of payment of the purchase, sale or exchange price and, if applicable, the terms and conditions governing the payment of additional funds, a new hypothecary loan, the transfer of the obligations of an existing hypothecary loan or a balance of sale price;
6. The terms and conditions governing the signing of the deed of sale, the lease or the contract of exchange by the parties;
7. The fact that any statement concerning the immovable or enterprise made prior to the transaction by the seller or lessor forms an integral part of the transaction;
8. The conditions for the acceptance of the transaction proposal, including the date and time at which the transaction proposal expires;
9. Any other right or obligation of the parties.³

If you do not use the OACIQ's recommended forms, your transaction proposal must contain these same clauses, in accordance with the regulator's expectations and with the Real Estate Brokerage Act and its regulations.

In all cases, the broker’s obligation to provide the parties concerned with a completed and signed copy of any contract or any transaction proposal applies.⁴

As to the sale of an enterprise, read the following article on our website: What forms should be used for the sale of an enterprise?⁵