Extensive renovation bills due to mold infestation, foundation cracks, water-damaged basements not disclosed by a seller is a common problem homebuyers in Canada encounter. When this happens, buyers are likely to file suit to recover expenses.
One example of this case was reported in myRealtyTimes back in July, 2014. According to the report, a real estate agent was ordered by the Ohio Court of Appeals to pay the $216,337 jury award to her former client, because she was found to have deliberately concealed a house’s defect. As a result of her failure to disclose the defects that she was clearly aware of, the jury found her act of omission as constituting a breach of fiduciary duty.
Real estate agents of Burnaby homes are obligated to protect the buyer’s interest by disclosing defects in a home, such as in the scenario mentioned above, for the prospect purchaser to determine whether the house is a good buy. However, it is understandable should some defects not be known immediately, such as those that would require a professional in order to identify. In which case, the services of Burnaby home inspection specialists are called for.
The two kinds of defects that sellers must be on the lookout for are:
Patent Defect. A noticeable flaw a purchaser sees as he checks the home, e.g. broken window, crack on the wall, leaky ceiling. The general principle caveat emptor, or “buyer beware” applies. If the deal is signed with the knowledge of such defects, it means he/she accepts such conditions, unless stipulated that seller will repair it.
Latent Defect. This is a hidden fault that cannot be determined under ordinary inspection. The law states that the seller is required to disclose any latent defect he’s aware of, such as anything that makes the house dangerous or uninhabitable like mold, wiring problems, weak foundation, flooded basement, or water-damaged roof. Sellers can be held liable for misrepresentation if they lie or deliberately conceal defects.
Bound by their Code of Ethics, however, real estate agents are prohibited to make erroneous representations of any property. They cannot conceal known problems, just as much as they cannot speak of defects they’re uncertain of. Important to note, though, is that they are obligated to advise potential buyers of known defects upon client’s inquiry.
Realtors are therefore advised to first ask the owner everything about the house’s condition. To further protect their professional interests, hire a qualified Burnaby home inspector from companies like Firstclass Building Inspections Ltd. for a thorough and more accurate disclosure.
(Source: Home Seller Fined $216K for Misleading Disclosure- Agent Popped as Well, Hankmiller.realtytimes.com, July 22, 2014)