Duty of Honesty and Good Faith in Performance of an Agreement of Purchase and Sale

In an earlier article I discussed the duty of good faith in the formation and performance of resale residential agreements of purchase and sale with particular focus on a buyer relying on his conditions to terminate an agreement. Typical conditions include the buyer arranging financing and/or insurance, and performing a home inspection, all of which conditions usually provide that the buyer may rely on such condition in his sole and absolute discretion.  In a recent decision the Supreme Court of Canada has ruled that there is a general duty of honest contractual performance in every contract. “This means simply that parties must not lie or otherwise knowingly mislead each other about matters directly linked to the performance of the contract. …

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Rented vs leased fixtures and how it can affect your home purchase

When preparing a listing agreement or an Agreement of Purchase and Sale a real estate agent must ensure that rental items (for instance, a hot water tank and heater, water softener, furnace or air-conditioner) are in fact true rentals and not the subject matter of a lease or other agreement which includes an obligation, as opposed to an option to purchase the piece of equipment.  The agent should ask his client or the other agent for evidence that it’s a true rental agreement. A useful starting point is the seller’s Enbridge bill which may disclose rental amounts being paid to Direct Energy or other lessors/sellers of equipment.  Unless the Enbridge bill clearly discloses the payment to be a true rental, …

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Agent Wins Commission Despite Seller Refusing to Accept Offer

Agent Wins Commission Despite Seller Refusing to Accept Offer This is great news for agents who have worked hard to procure an offer complying with the listing agreement only to have the seller refuse to accept the offer. In a recent case the Superior Court of Justice has confirmed the judgment of the Small Claims Court that as the full price offer in question was in sufficient compliance with the listing agreement, commission is payable. The case is fact specific. The listing agent had procured and presented several offers during the listing period. The court found that the seller was in fact “avoiding and otherwise frustrating” the agent because the seller had “decided not to sell unless he was able …

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HST Rebate For New Homes

HST REBATE  – New Home/Condominium purchased from Builders (not resales and not commercial properties) It is always important to review and understand your Agreement of Purchase and Sale. Unless it otherwise provides, if you entered into an Agreement of Purchase and Sale after June 18, 2009, and which in fact closes on or after July 1, 2010, you will be responsible for the HST, net of the GST/HST rebate, if any, if you qualify. If you (and others, all being individuals) are purchasing a newly constructed home or condominium unit from a builder with the intent that it will be occupied as your and their primary place of residence, or the primary place of residence of your or their “relation” (being limited …

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How Tax of A Non-Residents Sale of Real Estate Works in Ontario

If a seller of real property is a non-resident of Canada, section 116 of the Income Tax Act obligates the buyer to hold back and to pay to the CRA (within 30 days after the end of the month in which the closing occurs) 25% of the sale price unless the seller has applied for, obtained and delivered to the buyer a clearance certificate from Canada Revenue Agency certifying that the seller has paid any income tax payable or that he has made arrangements with the CRA to do so. This obligation is not optional – it’s mandatory. If the buyer fails to hold back and to pay 25% of the sale price as aforementioned, the CRA will pursue the buyer …

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City of Toronto Residential Property Owners: Front Yard Parking

Front Yard Parking permits are not transferable. Each new owner of the property must apply to the City for his/her own permit, which, if granted will include the payment of certain fees. It is the responsibility of the new owner to ensure that the existing front yard parking pad is legally installed. By calling 416-392-2489, one can determine the legal status and validity of any parking pads that may exist within the front yard and adjoining boulevards of the subject property. If you are concerned about parking, you should make it a condition of your Agreement of Purchase and Sale. Please call me with any questions that you may have at (647) 476-2262. No solicitor-client or other relationship is created …

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What is WETT: Wood Energy Technology Transfer?

Wood Energy Technology Transfer Inc. (WETT Inc.) is a non-profit training and education association which functions as the national registrar of the WETT program to promote the safe and effective use of wood burning systems in Canada. The Wood Energy Technical Training program is designed to: “provide training to those who offer wood energy products and installation and maintenance services to the public and to those who conduct inspections of wood burning systems, confirm and recognize the knowledge and skills acquired through field experience, self-study and successful completion of WETT courses by issuing certificates of qualification, provide training to specialty audiences as the need and demand arises.” A WETT inspection includes a thorough inspection of all wood burning appliances such …

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Pets: Are they allowed in rental apartment buildings and condominium buildings?

Although pets cannot be prohibited in rental apartment buildings in Ontario, they can be regulated and prohibited in condominiums where the condominium declaration so provides, BUT service animals must be allowed for owners/residents with a disability. The Ontario Human Rights Code trumps the condo Declaration. The condo corporation can ask for medical confirmation of the disability. In Ontario, service animals do not need to be certified and in fact there is no government body that certifies service animals. Although the Human Rights Code trumps the condo Declaration, the pet prohibition remains in full force and effect; it’s just not enforced against the occupant with the disability for so long as he/she remains disabled. No solicitor-client or other relationship is created …

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Tree Law – Overhanging Branches and Who Can Cut Them Down?

Unless there is legislation or restrictive covenants to the contrary, the current common law regime allows “each property owner, within the boundaries of his or her own property, to do as they wish. This is so both with respect to planting trees, which may tomorrow block a neighbour’s view or spill onto a neighbour’s property, and with respect to pruning or cutting the overhanging branches or roots of trees that cross a property line”. In other words, your neighbour may simply cut any part of a tree (with its trunk on your land) that crosses over the property line and overhangs onto his property. Pursuant to the Ontario Forestry Act  a “boundary tree” (a tree whose trunk straddles a property line) …

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Mortgage Down Payment Help From Parents: Is It a Gift, Loan, or Trust?

My mom gave me $50K to help with my down payment: is it a gift or is it a loan or did a trust just get thrown at me? Many parents are financially assisting their adult children to purchase real estate. Sometimes it’s a few thousand dollars; sometimes significantly more. Is this financial assistance a repayable loan,  a gift with no strings attached or will a court imply a (resulting) trust between the child and parent i.e. is the child holding the funds/property in trust for his parent? Succinctly put, unless there is clear evidence to the contrary, there is a presumption of resulting trust i.e. the adult child is holding the property in trust for his parent (which means …

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