Public articles

Notice regarding the notification procedure introduced following the coming into force of the new Code of Civil Procedure

With the coming into force of the new Code of Civil Procedure on January 1, 2016 and, therefore, the authorization to notify by any appropriate method, including by technological means...

The deposit on a promise to lease in residential and commercial real estate

Although leasing is no longer an act reserved for real estate brokers, the fact remains that any real estate brokerage licensee – whether the licence is issued in Quebec or another jurisdiction – who carries out  real estate leasing brokerage transactions in Quebec is subject to all the obligations arising from the Real Estate Brokerage Act. Therefore, by dealing with a broker for this type of transaction, the lessee or the lessor benefit from protection mechanisms provided by the Act.

When a party does not show up for its appointment with the notary

You are sitting at the notary’s, desperately waiting for the other party to show up for its appointment. After more than an hour, the other party still does not show up. What is going on? Although the date indicated under clause 11.1 of the Promise to purchase is not a mandatory delay, the consequences can be many for a party that fails to show up at the notary’s on the appointed date.

Are you familiar with umbrella mortgages?

In recent years, many people have unknowingly taken out an umbrella mortgage to finance the purchase of their homes. This mortgage product is now so common that some financial institutions have even limited their mortgage loan offers to umbrella mortgages. Despite its frequency, this product, also referred to as a collateral mortgage or a mortgage security deed, is not well known to members of general public who are more familiar with the so-called traditional mortgages.

Selling a property with a heat pump: Watch out for drafts

When a brokerage contract is signed, the broker may note that the property has a heating or air conditioning unit installed, a heat pump for instance. This type of unit has often been purchased by the owner under an instalment sale contract with a merchant. What are the ramifications for the broker when selling an immovable with a heat pump?

The lessee’s right to maintain occupancy and the repossession of a dwelling by the owner

The Civil Code of Québec grants several rights to the lessee of a dwelling, including the right to maintain occupancy. Basically, this right allows the lessee to occupy the dwelling for as long as he wishes. This means he can only be evicted under very specific circumstances provided in the law. The sale of the immovable does not impact this right, which the new owner must uphold. Not only does the lessee have the right to stay in his dwelling for the duration of the initial lease, but he is also entitled to the automatic renewal of the lease (renewal of right) at term. At term, the lease is renewed for the same period or, if the initial term was more than a year, for a period of 12 months.

OACIQ forms: For better prevention

To fulfil its public protection mission, the OACIQ published no less than fifty forms. They were designed to provide you with maximum protection, while clearly establishing the terms under which the broker will act.

Are you preoccupied by the occupancy date?

Clause 11.2 of the Promise to purchase specified the date at which the selling owner agrees to make the premises available to the new buyer. Sometimes the buyer wishes to occupy the premises before the date of signing of the act of sale. The OACIQ strongly advises against this practice since there are major risks involved for the seller in granting such a right to the buyer.

Shedding light on hidden defects

In real estate field, a defect is considered hidden if it has all the following features: […]

Disclosure of a suicide: the Superior Court confirms the usefulness of the declarations by the seller

On November 21, 2013, the Superior Court determined, in Fortin c. Mercier⁽¹⁾ judgment, that the seller of an immovable had the obligation to inform buyers that a violent death had occurred therein.

The importance for the parties of clearly understanding the promise to purchase

When drafting the promise to purchase, the real estate broker must discuss each phase of the buying process with the buyer in order to avoid surprises along the way. This step must include an analysis of the buyer’s needs and objectives and an evaluation of his financial capacity. It is up to the broker to ensure that the buyer clearly determines what he is looking for based on his means.

Exercising servitude rights when using the distribution grid

During a real estate transaction, real estate brokers often have to deal with cases of non-compliance with the obligations or rights contained in Acts of Servitude. Infringement of a servitude may delay the finalization of a transaction, and often causes problems between the seller, buyer and creditor. Hydro-Québec regrets having to do so, however, as the owner of a distribution network, it must assume its obligations and responsibilities.

Publication of sold price

The OACIQ’s position is the following: as long as the deed of sale has not been published in the land register, the price indicated in the deed of sale constitutes confidential information and must be treated as such by real estate brokers. They may not make this price public without the written consent of the parties to the transaction (i.e. of the buyer and the seller), nor use it in any advertising or allow anyone else to do so.

Payment of rent: the first payment and terms of payment

Concerning the payment of rent, section 1904 of the Civil Code of Quebec provides that:

“The lessor may not exact any instalment in excess of one month's rent; he may not exact payment of rent in advance for more than the first payment period or, if that period exceeds one month, payment of more than one month's rent.

Nor may he exact any amount of money other than the rent, in the form of a deposit or otherwise, or demand that payment be made by postdated cheque or any other postdated instrument.”

Heavy fines for carrying out the activity of an agency and broker illegally

Carrying out the activity of a real estate or mortgage agency or broker illegally is a violation of the Real Estate Brokerage Act.

Aging oil tanks - How to lessen the difficulties they can cause

Insuring an immovable with an oil tank that is aging⁽¹⁾ or has been improperly or inadequately maintained can prove difficult. This in turn could jeopardize a transaction. When selling such an immovable, real estate brokers must be mindful of their duty to inform and advise, which will help reduce the problems that the presence of such a tank can cause.

Can a promise to purchase be withdrawn?

The promise to purchase signed by the buyer shall be binding on him until the expiry of the acceptance period indicated in clause 14.1. The broker must always inform the buyer that his promise to purchase binds him to the seller as soon as it is signed.

Clause 10.5 of the promise to purchase, to ward off unpleasant surprises

Should the buyer or the seller be notified, following the fulfilment of conditions, but before the signing of the deed of sale, of any defect or irregularity whatsoever affecting the titles of the immovable or the declarations and obligations of the seller, the buyer has a recourse provided under clause 10.5 of the Promise to purchase form (for the Promise to purchase – Divided co-ownership (PPD) form, it’s under clause 10.7). If the buyer learns that the immovable has a defect or irregularity (e.g. an inground pool encroaching on a Hydro-Québec servitude), he is not bound to purchase the immovable with this irregularity.

Property Transfer Duties

As indicated in section 2.1 of the Act respecting Duties on Transfers of Immovables, the tax brackets are increased each year according to the Consumer Price Index for Quebec.

Understanding first refusal clause R2.2 of the mandatory form Annex R - Immovable

Clause R2.2 of the mandatory form Annex R – Immovable, the so-called “first refusal", generates a lot of questions from brokers and consumers. In fact, the OACIQ Info Center receives many calls to this effect. Followings are a few clarifications to help understand how it works.