Canadian Lawyer

Real Estate Still ripe for litigation Information or disclosure statements in real estate transactions are not universally accepted and lawyers remain divided over their value. mandatory in British Columbia for any property being listed on MLS, the multiple listing service. Edward Wilson, the Canadian Bar Association's long-time representative on the B.C. Real Estate Association's standard forms committee that produces the PDS in that province, says their intent is two-fold: to protect realtors and protect the parties involved. "Realtors were always stuck in the middle" of disputes between vendors and purchasers, he says. "This was designed to go beyond oral representation, more than what they used to get." B.C.'s three-page questionnaire is designed to start the conversation on potentially serious issues with a property. While he says they're not perfect, they're helpful and are working relatively well. They are also effective in keeping real www.CANADIAN estate agents out of disputes that might arise over transactions. "The mere fact that there is litigation is not necessarily a bad thing." The statement, he says, provides "a paper to point to" when, in the past, there was nothing. "I think it [litigation] just reflects the number of the transactions and the huge cost to all of the parties." In B.C. alone, Wilson counts at least 100 cases that have made their way to court — a situation Manitoba's recently retired chief justice Richard Jamieson Scott predicted in 2003 as part of a Court of Appeal panel in Alevizos v. Nirula: "Based on the experience of those provinces that have employed the PDS, it seems to present a ripe ground for litigation." Over the intervening decade, the courts have provided some direction about the L a w ye r m a g . c o m September 2013 23 Huan Tran I t never hurts to take some extra precautions. Or does it? Information or disclosure statements in residential real estate transactions have been keeping litigators and Canadian courts busy since they were introduced in the 1990s. They were designed to provide an extra level of protection in residential real estate transactions beyond the buyerbeware principle. In some jurisdictions they are mandatory. The statements are often three or four pages of questions about the condition of the property, designed to raise any red flags or point out serious problems. But they are not universally accepted and lawyers are torn over their value. Property disclosure statements are By Marg. Bruineman

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