Disclosing defects when selling a Toronto home

Did you know that Sellers (and their real estate agents) have a duty to disclose any defects in a property that might affect a buyer’s use and enjoyment of that property?

Physical defects are the kinds of defects you can see. Generally, when you buy a house, you buy what you see – including the door with the missing doorknob and those scratched hardwood floors. Physical defects don’t have to be disclosed – a buyer can see them.

Latent defects are hidden and can’t be seen under normal inspections. The law says that if the Seller knows about a latent defect that makes the home either uninhabitable by the Buyer; unfit for the Buyer’s intended purpose; or dangerous, then the Seller must disclose this defect. In addition, the Seller cannot intentionally conceal what would otherwise be a patent defect.

What kinds of things should a Seller disclose?

  • That leak in the basement every spring.
  • The fact that your home inspector told you there were termites in the basement when you bought the house and you didn’t bother to treat for them.
  • The knob and tube wiring in the house.
  • That the neighbour is an illegal rooming house and someone was murdered there last year (true story – click here for the details)
  • The fact that someone died in the house.
  • That the great addition to the house was added without building permits.
  • The fact that the basement apartment is illegal. (click here to find out if you need a building permit).
  • That you have lead in your drinking water.
  • …..

If you’re a Buyer, always ask the Seller if they’ve signed a SPIS – Seller Property Information Sheet – the official document to disclose what you know about a home. And if you’re a Seller, completing a SPIS can save a lot of headaches (and money) later – you have proof that you disclosed everything you know about your home.

If you’re not sure you should disclose something…chances are that you should disclose it. If you were buying the property, is this something you would want to know? Might it affect the Buyer’s enjoyment of the house – and come to haunt you in a lawsuit?

Comments

  1. I’m a realtor in Vancouver with Remax, North Vancouver is my area of focus. I just chanced upon your web site looking for some photos of knob and tube.. anyway I just just wanted to tell you I love your slogan and it reflects my business philosophy as well.

  2. I recently purchased a century home where the seller (also the realtor) advised us that all of the knob and tube had been replaced. During the home inspection we found evidence upstairs of a small amount still remaining and the seller assured us it must be the only light that it didn’t get changed on. Lo and behold during some renovations we find that the only wire that was replaced was from the new panel to outlet and switches but EVERYTHING else is still knob and tube. How do we proceed? We are looking at thousands of dollars to replace and then repair walls and ceilings. Any advice?

    • Melanie Piche says:

      Oh no! Definitely call the lawyer who completed your real estate transaction (though he or she may very well refer you to a litigation lawyer). Not fun at all but the courts are likely the direction you’ll need to take this…good luck!

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