29 Nov Sale without Legal Warranty of Quality at the Buyer`s Risk and Peril
If you want to sell something without being held responsible for hidden defects, you must write that the item is “sold at the buyer`s own risk, without warranty against hidden defects” and not only that “this sale is without legal warranty”. Given the lack of a legal guarantee, the buyer cannot, in principle, sue the seller for hidden defects, since the contract was concluded “at the risk and peril” of the buyer. Even if a broader scope is beneficial for the buyer, the use of errors caused by fraud is not without difficulties. The exclusion of the legal quality guarantee gives you leverage to negotiate the selling price. Your real estate agent will represent you in negotiations with the aim of obtaining the property at the best price, which, depending on the situation and the context of the market, is likely to be lower than its value with the available benchmarks as well as the real estate cycle. In return for the risk assumed by the buyer, the selling price is generally lower than that of a comparable property. Thus, buyers who agree to take an additional risk benefit from a discount. So what risks are buyers exposed to? If this is your dream property, you probably won`t want to give up the opportunity despite the lack of legal warranty. They also don`t want to risk falling into a huge trap.
Here are some suggestions to make sure you make the best decision regarding the purchase of the property. The seller has the possibility to exclude the legal warranty from the sale. Where applicable, the promise to purchase and the deed of sale must clearly indicate that the sale is “without warranty, at your own risk”. Therefore, you may not be “surprised” by this clause. Estates: The heirs of a property may not have a good knowledge of its history. In fact, the property may be old and they do not know if there have been any problems with the quality of the building in the past. In order to protect themselves and avoid the risk of possible lawsuits, the heirs then sell without legal warranty. You are looking for a property in Montreal with your real estate agent. If you search online, the detailed property sheets are marked “sale without legal warranty of quality, at the risk and peril of the buyer. Since you are not sure about the meaning of these terms and their implications, ask your real estate agent for more information. In Quebec, the law stipulates that the sale of real estate must guarantee quality and ownership. These two guarantees constitute the legal guarantee.
Some sellers choose to sell their property without legal warranty. However, in these following 3 situations, selling without legal warranty is the most common. The phenomenon of sales without legal warranty has been observed for several years in real estate transactions in Quebec. However, this phenomenon has increased since 2019 during the pandemic. Buyers may choose to waive the legal warranty to facilitate the acquisition of the coveted property. Sellers, on the other hand, sell their property without legal guarantees, thinking they will let go of their responsibility. But is it really a good idea? It is important to define fraud as to whether a buyer can take this route to take legal action against a seller. The guarantee of the right of ownership concerns defects of the right of ownership. This could concern, for example, a default on the mortgage related to the property before the sale. However, the parties may agree otherwise.
Often, properties are for sale with the mention “without legal warranty”. In such cases, the buyer acquires the property at his own risk and waives in advance his right to take legal action against the seller in case of hidden defects. Often, the sellers of these properties are people with limited knowledge of the house, such as the executors of an estate. JLR.caOACIQ – Articles 122929, 200145, 202655, 203686, 208302, 208364Jamie Benizri, Legal logic – Guest ticketÉducaloi – Real estate: purchase without legal guarantee – Bank withdrawals: If a homeowner no longer pays his mortgage, a reminder is sent and a court decision is rendered a few months later. The bank then takes possession of the property and proceeds with a direct sale. Buildings taken over by banks are always sold without legal warranty, because a bank does not want to be sued for latent defects. The legal guarantee includes both the guarantee of quality and the guarantee of the right of ownership. The Quebec Court of Appeal had the opportunity to render a decision in December 2018 describing a clear distinction between the concepts of hidden error and fraud. The court ruled that an exclusion from the legal guarantee against hidden defects does not release the seller from his obligation of good faith in the context of the conclusion of a contract of sale[18]. The fault of a party caused by the fraud of the other party or to his knowledge affects consent in all cases where the party would not have entered into a contract without him or would have concluded it on other terms.
The quality guarantee concerns hidden defects. When we talk about latent defects, we are talking about a “hidden” defect that undermines the quality of the building. This defect is known to the seller and has been omitted from the seller`s declaration (VIS). In addition, the hidden defect existed at the time of purchase, but was unknown to the buyer. Hidden defects are usually not easily detectable and can be, for example, mold in the walls, cracks in the foundation, moisture on the floor, water infiltration, etc. Every house I bought was sold as is, WITH an inspection quota. Basically, you can do an inspection and either have problems solved or you can cut and execute. No used home I know of comes with a warranty after the sale. Yes, the seller can exclude the legal warranty.
The offer to purchase must state that the sale is made “without legal warranty, at your own risk”. It can be concluded that in the event of hidden defects, a contract with the seller containing the exclusion of liability “without legal warranty and at the risk and peril of the buyer” is certainly a dangerous clause that potential buyers should pay attention to before agreeing. In order to make an offer more attractive, a buyer can also waive the legal warranty and inspection before purchase.