Disclaimer Clause; Joint Tenancy Risk #102

Apr 01, 1987

CATEGORY:   
TAGS:      

PRINT


By Gerry Neely
B.A. LL.B.

"Above information is from sources believed to be reliable, but should not be relied upon without verification. N.R.S. assumes no responsibility for its accuracy."

This clause, at the foot of a page in an N.R.S. catalog containing listing information of a property available for sale, proved to be quite valuable in a law suit. A recently licensed salesman took his first listing from friends who asked him if he were interested in selling their home. The information he was given was taken from an earlier listing agreement prepared by another salesman. The listing salesman did not check the information he took from the earlier listing, either by asking questions of the owner or by checking other sources. The listing stated that the house had a concrete foundation and that the walls and ceilings were insulated. As events established, it lacked a concrete foundation and only a portion of the walls and ceilings were insulated.

A selling licensee gave prospective purchasers a number of listings from the N.R.S catalog and from the MLS book. As a result of their examinations of these listings, they selected this house and went with both the listing and selling salespersons to examine it. While the salespersons sat in the living room, the prospective purchasers went through the house but did not go into the crawl space, partly because it was dark and without electric light, and partly because the dirt on the floor helped to deter any examination. They asked no questions of either licensee, and no representations were volunteered or made by the licensees to the purchasers. Neither licensee was aware of the deficiency.

Having discovered the problems and incurred the expenses in rectifying them, action was brought against the vendors, the two licensees and their employer. The Judge held that the listing agent was negligent in failing to verify the information given to him by the vendor. This decision would have been sufficient to establish liability on the part of the listing salesman and his employer, but for the existence of the disclaimer at the bottom of the page in the N.R.S catalog. The evidence established that the selling agent had not drawn the disclaimer to the purchasers' attention, or advised the purchasers that the information might not be accurate and should not be relied upon. The purchasers testified that they did not notice the disclaimer.

The Judge held the disclaimer contained such a clear and express warning that the information within it should not be relied upon without verification, that the purchasers should have been aware that N.R.S was not assuming a duty of care toward the purchasers. If it did not assume a duty of care, it would not be liable in negligence to the purchasers, to whom it had no contractual duty. The combination of the disclaimer and the fact that neither of the licensees had made any representations to the purchasers, resulted in the purchasers' claim failing.1

* * *

Parents may register their interest in property with an adult child as Joint Tenants, as an estate planning device. The purpose is to make it easier and less expensive to transfer property on the death of the parents. This may create other problems, as it did for one family when the son holding a jointly registered interest became bankrupt. Even though the son contributed nothing, did not expect to have any use or enjoyment of the property during his parents' life, other than through their invitation, his undivided one-third interest was held to be available to satisfy his creditors.

The reason, registration of his name on the title was conclusive evidence at law and in equity that he was entitled to an estate in fee simple in the lands and, because of that, the trustee in bankruptcy was entitled to sell his interest for the benefit of his creditors.@

  1. Tabakis v. Villarosa et al, In the County Court of Westminster, New Westminster Registry, No. F850211.
  2. In The Supreme Court of British Columbia in Bankruptcy, Vernon Registry No. 4745

To subscribe to receive BCREA publications such as this one, or to update your email address or current subscriptions, click here.

What we do



Popular tags within Legally Speaking



Popular posts from BCREA

  • UPDATED: COVID-19: REALTORS® and Consumers Can Travel for Real Estate Transactions
    Apr 23, 2021
  • Applications for BC Emergency Benefit for Workers Now Open
    May 01, 2020
  • First-Time Home Buyer Incentive Launches in September
    Aug 22, 2019