Considering that real property purchases are perhaps the largest purchases in dollar terms that a lot of people will make in their lifetime, it is very advisable that we avail ourselves of all the professional expertise that may be necessary along the way. It is advisable that people seek counsel prior to signing the doted lines on any real estate deal. If the harried market drives a need to put in an offer, then make it conditional on legal review and get the agreement to a lawyer.
Real estate professionals are great at what they do but miss some of the legal nuances that may become a headache down the line. Most realtors in Ontario use the Ontario Real Estate Association form of agreement when negotiating a purchase or sale. Whereas that agreement is a great and well thought out document, it is mots effective when properly filled out.
Below are examples of how a great teeth document can create more problems than the parties bargained for.
A common flaw in the completion of the OREA residential condominium resale agreement is the failure to delete the appropriate phrase with respect to ownership or exclusive possession of parking spaces and lockers.
Part of the clause reads as follows:
The best way to ensure there is no confusion as to what is being sold or purchased is to cross out whichever is not applicable in the following manner:
In the example above it is now clear this seller OWNS the parking and locker and cannot on closing date or at the time of review of status certificate suddenly claim the buyer knew all along all that was being sold was the exclusive use of the parking and locker.
Another example is the ownership versus rental of chattels/fixtures.
The type set language under section 6 of the residential resale agreement is :
The following equipment is rented and not included in the Purchase Price. The Buyer agrees to assume the Rental contracts if assumable:
Most OREA forms are filled out in this section using language such as “Hot Water tank if applicable” or “N/A”.
If in fact something is rented such as HVAC equipment or Hot Water tank, then that section ought to be properly filled out as follows;
“Hot water tank. All assumption costs shall be borne by Seller and in the event the equipment is not assumable the Seller shall pay the full price to buy it out and transfer to the Buyer prior to closing.”
Thus reducing the risk of a buyer being saddled with a rental equipment that’s not assumable and has to be paid off.