Canadian Lawyer

w w w . c a n a d i a n l a w y e r m a g . c o m O C T O B E R 2 0 1 8 23 tion industry's large contribution to the country's GDP and the relatively low incidence of condo failures and bankruptcies in B.C. A big problem with pre-construction projects is delays. Time schedules are rarely met, although provinces generally legislate limitations on extensions that developers are allowed. Extended delays can be cause for concern for the buyer for fear that the project will never be completed or that the final timelines extend beyond their moving plans, which may have involved the sale of their previous home. In Nova Scotia, builders can extend closing by 360 days. "We did have people who were looking to get out of their agreements to purchase their units. The Nova Scotia legislation gives developers basically a full year of extensions without having to get the permis- sion of the purchasers," says Lauren Randall, an associate lawyer in the BoyneClarke LLP real estate practice in Dartmouth. "They're selling units long before there is a product. I've never been involved in one that has actually closed when it was originally expected to close." She tells clients that they can ask for their money back when a project is delayed but the developer has no obligation to provide any remedies. If the project is delayed beyond the 360 days allowed, purchasers have the right to demand their deposits be returned, but they are unlikely to get any interest or other compensation. Roberto Noce, a partner at Miller Thomson LLP in Edmonton and a specialist in condo law, says condo law is relatively new in Canada. "In fact, Alberta was the first province in Canada to adopt condo legislation in 1966," he says, adding that Canada's first con- dominium plan was registered in Edmonton. But it wasn't until Jan. 1 this year that Alberta's condo laws were amended to provide greater clarity to developers in terms of their expectations and provide protections for buyers, ensuring their deposits are held in trust by a lawyer and returned in the event of a default by the builder. "Today, I would say to a potential buyer that your money and position are much safer today than they were last year," Noce says. But even with the deposit returned, the buyer loses out on any appreciation or interest their investment may have earned during the time they were waiting for the condominium to be built. Noce says buyers are often swayed by the emotional attachment to the purchase and don't always look at it objectively. The result is that they could end up signing contracts that provide them with few protections. Important factors often overlooked at the time of purchase are a certain move-in date and any remedies the builder might offer if that's delayed. And although the developer retains the right to cancel development if a certain threshold of sales isn't achieved by a certain date, the contract could possibly include damages that can flow to a purchaser in the event of a cancellation. "People have the freedom to contract," but the market demand could dictate the buyer's bargaining power, Noce says. "The chances of you having any clout to suggest any changes are on the low end." R E A L E S T A T E CORPORATE COUNSEL Connect with Find more than 4,100 corporate counsel and over 1,500 organizations along with fresh editorial content, information on deals and links to important resources. Lexpert.ca/ccca ntitled-10 1 2018-09-12 5:11 PM ntitled-10 1 2018-09-12 5:19 PM

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