Real Estate Act

Caveat Emptor and Seller’s Lack of Knowledge of a Latent Defect #383

Legally Speaking

By Gerry NeelyB.A. LL.B. A Supreme Court judge concluded the following advertisement by a representative for the sale of a lot implied a warranty that the buyer could commence construction of a house without unusual expense or building methods:”0.59 (acre) building site in an area of executive homes. South West view property. Fully serviced lot.

Caveat Emptor – Buyers’ Due Diligence; s.39 of the Real Estate Act and the Power to Impose a Penalty for Frivolous Lawsuits #369

Legally Speaking

By Gerry NeelyB.A. LL.B. A buyer who bought a waterfront home subsequently sued the listing agency and salesperson in the Victoria small claims court for negligently misrepresenting the garage size and stating that the kitchen cabinetry was made of cherry wood. She complained the garage was not long enough to hold a standard sized car

Substantial Instead of Minor Changes to the Condominium Plan; Disclosure Statement – Failure to File Amendment, Material False Statement in the Budget #269

Legally Speaking

By Gerry Neely B.A. LL.B Since many developers are now pre-selling before there is a hole in the ground, their presentations to prospective buyers can only be based upon models, plans and sales brochures portraying the merits of the condominium a prospective buyer may occupy. Inevitably some alterations to the plans are required as construction

Real Estate Council Lack of Jurisdiction #258

Legally Speaking

By Gerry NeelyB.A., LL.B. Section 20 of the Real Estate Act gives the Real Estate Council the power to conduct an inquiry into a complaint, under regulation 9.12, that a licensee has been negligent or incompetent in the performance of any act, for which he is required to hold a license. While the committee reviewing the evidence

Fraudulent Misrepresentation Made Against Sellers #238

Legally Speaking

By Gerry NeelyB.A., LL.B. The Property Condition Disclosure Statement, (PCDS), was the basis for proof of a claim of fraudulent misrepresentation made against sellers, by buyers, when the buyers had to pay approximately $4,000 to correct the septic system problems they found when they took possession of the property. The sellers stated in the PCDS

Real Estate Act Section 28 – Disclosure by Licensee #237

Legally Speaking

By Gerry NeelyB.A., LL.B. Not every listing contract creates a fiduciary relationship, nor does every imperfectly completed Section 28 disclosure by a licensee give a seller a legal basis for refusing to complete the sale of the seller’s property to the licensee. An offer was made in the name of a licensee “and assigns” because

Commission Upon the Sale of "An Insolvent Property" #232

Legally Speaking

By Gerry NeelyB.A., LL.B. The case referred to in Column #231, which discussed the loss of a commission payable by an insolvent owner of property valued at less than the total amount of mortgages and liens registered against it, raised comments as to how licensees can protect themselves. The judge stated that licensees either needed the

Independent Contractor Status v. Employee Status #227

Legally Speaking

By Gerry NeelyB.A., LL.B. As most licensees must be aware, while the Supreme Court of British Columbia has held in three cases that under the Real Estate Act a salesperson can only be an employee of an agent, the policy of Revenue Canada under the Income Tax Act, is to recognize the independent contract status of a salesperson. That

Residential Tenancy Act #225

Legally Speaking

By Gerry NeelyB.A., LL.B. Landlords will have to be as quick off the starting blocks as Linford Christie, in the 100 meters at the Commonwealth games, if they are to retain the benefit of a security deposit for unpaid rent or damages owed by a departing tenant. A section of the Residential Tenancy Act, which is in

Mutual Rights of Way Continued #207

Legally Speaking

By Gerry NeelyB.A., LL.B. What are Rowan’s rights as the owner of land over which there is a common driveway, shared with the adjoining neighbor Martin, where Martin has an obligation to repair, but fails to do so? In 1967 when the right of way was created, whoever owned the adjoining property agreed to pay

Removing Fixtures; Whim or Fancy #205

Legally Speaking

By Gerry NeelyB.A., LL.B. If section 441 of the Criminal Code of Canada were better known to tenants, less of them might trash rented premises. This section makes it an offense, punishable upon conviction for up to five years imprisonment, if an occupant of a dwelling house or other building deliberately and to the prejudice

A Potpourri of Trivial Tidbits #183

Legally Speaking

By Gerry NeelyB.A., LL.B. In the tradition of the wisdom of Solomon is a case involving an owner who in the course of excavating for a house foundation, damaged the roots of a tree standing on the boundary line between his and the adjoining owner’s property to such a degree that the tree died. The

Conduct of Sales Proceedings #182

Legally Speaking

By Gerry NeelyB.A., LL.B. An exclusive conduct of sale given in court ordered proceedings for the sale of property is normally limited to a stated period of time and usually gives the person with conduct of sale the right to list the property with an agent. If a court ordered sale order authorizes payment of

Bankruptcy of an Agent #177

Legally Speaking

By Gerry NeelyB.A., LL.B. There have been fortunately, very few bankruptcies among real estate agencies in British Columbia, but when they do occur, they have unpleasant consequences for salespersons sharing in commissions paid to the bankrupt firm. Usually the bankrupt agency had assigned its receivables to its bank to secure a line of operating credit,

Amended Disclosure Statement – Rescission Rights #171

Legally Speaking

By Gerry NeelyB.A., LL.B. A judge of the Supreme Court of British Columbia has interpreted the rescission rights contained in Part II of the Real Estate Act which are available to the purchaser of a strata title property, in a way which may bring some limited joy to developers. The case involved an accepted offer made March

Relief from Forfeiture #166

Legally Speaking

By Gerry NeelyB.A., LL.B. Another deposit returned to a purchaser who was in default, but this time it was because the vendor benefitted from the purchaser’s breach of contract. A purchaser who failed to close on the completion date because of insufficient funds, sued for the return of a $50,000 deposit paid September 1989 upon

Partnership – For Better or for Worse #150

Legally Speaking

By Gerry NeelyB.A., LL.B. When several people agree to buy property in their names with the intention of developing it for resale at a profit, but without any further agreement or discussion of what the legal relationship among them is to be, have they created a partnership? Joint ownership does not by itself create a partnership,

Commissions – Listing Agreements for Court Ordered Sales #82

Legally Speaking

By Gerry NeelyB.A. LL.B. A recent decision in an action which is likely to go on for some time involves an owner of a foreclosed property that was sold by Court Order, who has sued the lawyer who was advising him throughout the foreclosure proceedings. The basis of the action is that the lawyer consented

Prospectus and Court Ordered Sales #80

Legally Speaking

By Gerry NeelyB.A. LL.B. By the time this is published, we hope that Bill 66, The Real Estate Amendment Act (No. 2) 1985,* has been proclaimed. If it has and the Superintendent has made available the form and contents he will require for a disclosure statement, then the long wait to obtain approval of a prospectus, which

Section 30 Real Estate Act #78

Legally Speaking

By Gerry NeelyB.A. LL.B. This is the section that prohibits payment of any commission or other compensation to any unlicensed person for “acting or attempting or assuming to act, as an agent or salesman.” BCREA has been asked whether payment of a tip for a tip that leads to a listing, is a breach of

Legal Advice – The Pitfalls of Giving #59

Legally Speaking

By Gerry NeelyB.A. LL.B. Adam entered his solicitor’s office with a writ in his hand and an expression on his face which his solicitor, as Adam’s old golfing partner, recognized. It was the “how did this happen to me” look that appeared on Adam’s face when, after playing faultless golf for seventeen holes, he sliced

Section 28 Disclosure Statement #53

Legally Speaking

By Gerry NeelyB.A. LL.B. Section 28 of the Real Estate Act was amended in 1981 to widen the requirements for disclosure to be made by a licensee prior to the purchase of real estate by the licensee or his associates. The amendment required the preparation of a disclosure statement “in the form and manner prescribed by the

Payment of Commission #48

Legally Speaking

By Gerry NeelyB.A. LL.B. A recent judgement is of the good news/bad news type of bad joke – the good news, Mr. Agent, is that you have earned a commission, the bad news is that you can’t enforce payment of it. These circumstances arose in a case in which a vendor agreed to sell the

Prospectus – Receipts #49

Legally Speaking

By Gerry NeelyB.A. LL.B. The recently distributed Bulletin referred to the intention of the Superintendent to provide additional exemptions from the provisions of the Real Estate Act relating to prospectuses. Since there is no present intention to eliminate the prospectus requirements in their entirety, a B.C. Supreme Court Decision highlights the necessity of complying with Section 50(7)

Prospectus, Disclosure Statement and Other Changes #83

Legally Speaking

By Gerry NeelyB.A. LL.B. More than you ever wanted to know about this subject, but were afraid to ask. The changes to Part 2 of the Real Estate Act that have been made over the past three years, ending with the most recent policy statements Numbered 7 and 9 issued by the Superintendent in December, 1985, justify

The Real Estate Act and the End of the 100% House #23

Legally Speaking

By Gerry NeelyB.A. LL.B. Unless a recent decision is reversed on appeal or the Real Estate Act is changed, the 100% house may disappear. This describes the arrangement between an agent and salesperson where the agent receives no part of the commission earned by the salesperson, but, instead, receives a rental or other payment which defrays the