Seller Property Information Statement (Part 8)

By
Commercial Real Estate Agent with RE/MAX West Realty Inc., Brokerage (Toronto)

SPIS ~ Document Reviewed Part 8

ONTARIO REAL ESTATE SOURCE


By Brian Madigan LL.B.

This is a further continuing review of the Seller Property Information Statement currently in use in Ontario.

This section deals with final summary and general comments at the end of the document, sellers' liability, indemnity in favour of the agents, the truthfulness and accuracy of the statement.


The regular print as underlined is the actual document. My comments appear in italics.


Seller Property Information Statement ~ Residential

ADDITIONAL COMMENTS __________________________


This is your opportunity to add anything else that may be relevant.

Schedules(s) attached hereto and forming part of this Statement include:

_______________________________________


There would appear to be an advantage to attach some documents here. If you had a warranty, a statement or an invoice, this might be the time to attach it. Now, at least, the buyer has that additional information which might qualify your answers somewhat.


The Sellers state that the above information is true, based on their current actual knowledge as of the date below.

That first comment is rather clear and unequivocal. The statement IS TRUE! There is no qualification here, no fudging in the expression of the sentiment. It is not believed to be true. It is not "felt" to be true. It is not "based on my reasonable belief and expectation to be true". There are no qualifiers here. This IS true, absolutely, guaranteed and if you don't believe me, you can sue me!

That's what the document says. Not quite sure, then have another look at it. Yes, there is a small qualifier contained in the sentence but what does it say?

It says: based on their:

1) current,
2) actual

knowledge, and it adds a time period which is the date set out in the document.

So, what does that mean? The Sellers say that they have knowledge about the question. The knowledge is current. It is their actual knowledge. And, of course, one more thing: it is TRUE.

The only way out on this representation is to say that things changed subsequent to the date the document was signed.

Any important changes to this information known to the Sellers will be disclosed by the Sellers prior to closing.

OK, that was a short-lived qualifier. If things change, then the sellers MUST report the change. What would be proof of knowledge? You might think that it would need to be an admission, but that is not really the case. If the Court concludes that reasonably the sellers either knew or "ought to have known" then that will be sufficient.


Sellers are responsible for the accuracy of all answers.

Another very clear and unequivocal statement. This is not a belief or a hunch or a feeling or a best guess or a statement "all things being equal". This is an ACCURATE statement.

Responsibility is imposed upon the sellers, not anyone else.


Sellers further agree to indemnify and hold the Brokerage/Broker/Salesperson harmless from any liability incurred as a result of any buyer relying on this information.

Now, that would seem to be peculiar! If the seller is the one who is responsible for the truthfulness and the accuracy of the statement, why would the agents care? Why would they incur any liability?

The truth of the matter is that the agent (the listing agent) is the one who has requested the sellers to sign the document. Now, it is this particular document that is coming back to haunt them. In many cases, their own agent said, "it's fine",,,,,,,,, "sign the statement, people will think you're hiding something if you don't". Everyone else signs the statement, don't worry about it, nothing will happen. It's designed for your protection, then they can't come back on you. These are just some of the comments that are made to induce, coerce and require sellers to sign these statements, in many cases without fully reading and comprehending their significance.

So, why the need for the indemnity? Because the agent was likely negligent in explaining the document to you!


The Sellers hereby authorize the Brokerage to post a copy of this Seller Property Information Statement into the database(s) of the appropriate MLS® system and that a copy of this Seller Property Information Statement be delivered by their agent or representative to prospective buyers or their agents or representatives.

Once it is posted as available, you can bet that another agent will ask for a copy. In fact, if it is on MLS, then any buyer's agent must ask for a copy under the Real Estate and Business Brokers Act. If they fail to do so, then they are negligent, and they are subject to censure and disciplinary proceedings by the Real Estate Council of Ontario.

The Sellers hereby acknowledge receipt of a true copy of this statement.

This way, the sellers cannot later deny that they signed it.

DATE ____________________

Signature of Seller ________________________

DATE ____________________

Signature of Seller ________________________




I acknowledge that the information provided herein is not warranted and hereby acknowledge receipt of a copy of the above information including any applicable Schedule(s).


This is a spot for the buyer to sign. So, the buyer has the document in hand. Except for a few qualifiers here and there, that entire document WAS warranted. So, what difference does it make if the buyer says it's not? NOTHING, absolutely nothing! They weren't making any statements. The buyer can still sue.

DATE ____________________

Signature of Buyer or Authorized Representative ____________________


DATE ____________________

Signature of Buyer or Authorized Representative ________________________



The authorized representative here is presumably the buyer's agent.


That's the end of the actual document review. Later we'll have a look at some of the case law in respect to the Seller Property Information Statement and the seller's actual legal obligations under the law.

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, or you would like a free market evaluation of your home in Erin Mills, Credit Mills, Credit Woodlands, Sheridan Homelands, Sawmill Valley, Bridlepath, Pheasant Run, Sherwood Forrest or Mississauga Oakridge, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

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