Accurate information and clear disclosure protect both parties in a transaction
By Joseph Marovitch
Previously published in WestmountMag.ca
Selling a property without a real estate broker does not relieve the homeowner of their legal obligations. In Québec, sellers remain subject to the Civil Code of Québec, including the rules governing misleading representations and the legal warranty. Real estate brokers have additional professional obligations under the Real Estate Brokerage Act and its regulations. That Act is separate from the Civil Code; it does not impose the same professional requirements on every homeowner selling privately.
Information provided to prospective buyers should be truthful, and sellers should not conceal known problems.
Whether a property is sold privately or through a broker, accuracy matters. Information provided to prospective buyers should be truthful, and known problems should not be concealed. False statements or deliberately withheld information can lead to legal proceedings even after a notary has signed the deed of sale. Depending on the circumstances, a buyer may seek a reduction in their obligations, damages or the annulment of the contract. These remedies are not automatic: the facts and the applicable legal requirements determine what recourse is available.
Disclosing problems with the property
A seller who knows about a problem with the foundation, plumbing, electrical system, heating or another important component should disclose it clearly rather than assume that the buyer’s inspection will uncover it. In Québec, fraud can result from silence or concealment when it causes the buyer to enter into a contract they would otherwise have refused, or to accept different terms. However, a seller’s responsibility for a latent defect does not always depend on whether they knew about it.
Where the legal warranty of quality applies, the seller warrants that the property is free from serious latent defects existing at the time of sale. Such a defect must make the property unsuitable for its intended use or diminish its usefulness so substantially that the buyer would not have purchased it, or would not have paid as much, had they known about it. The warranty does not cover a defect already known to the buyer or an apparent defect that a prudent and diligent buyer could detect without needing an expert. A seller may nevertheless be responsible for a qualifying latent defect they did not know existed. Knowledge of the defect can expose the seller to additional liability for the buyer’s losses.
Measurements and descriptions must also be accurate
The building’s condition is not the only information that matters. Carefully check room dimensions and other statements used to describe the property. For example, advertising a bedroom as 12 feet by 16 feet when it is actually 8 feet by 12 feet creates a substantial discrepancy. If that information materially influenced the buyer’s decision or the terms of the purchase, it could become the basis of a legal claim.
A mistake does not automatically create liability or allow cancellation of the sale, but a material misrepresentation can have serious consequences. As a practical precaution, sellers should verify measurements before publication and promptly correct errors. When information is uncertain, state that uncertainty rather than replace it with an unsupported assurance.
The seller’s declaration
In residential brokerage transactions covered by OACIQ’s rules, the broker must complete the appropriate seller’s declaration form with the seller and obtain the seller’s signature when the brokerage contract is signed. The form documents the property’s history and condition so buyers can make an informed decision.
For the applicable chiefly residential properties containing fewer than five dwellings, including undivided co-ownership, brokers use the Declarations by the seller of the immovable form. A separate form applies to divided co-ownership. Requirements differ in some circumstances, including when the seller is a legal person. These brokerage-form requirements should not be confused with a universal obligation for every homeowner selling privately to use an OACIQ form.
A seller’s declaration records what is known about the property; it is not a blanket release from liability.
The seller must answer to the best of their knowledge, explain uncertainties and provide supporting documents in their possession. The form does not require sellers to declare facts they do not know, but it does require care and honesty about what they do know. A seller who has never lived in the property may have limited first-hand knowledge but may still have inspection reports, repair invoices, or other relevant records. Don’t overlook those documents simply because the seller did not occupy the home.
Completing the declaration does not eliminate responsibility for every defect. It records disclosures and helps the buyer decide what further investigation is needed; it is not a substitute for a properly drafted warranty exclusion.
Selling without legal warranty of quality
Québec’s legal warranty has two components: the warranty of ownership and the warranty of quality. The first concerns title and related matters; the second concerns qualifying latent defects. These warranties apply by operation of law unless they are validly modified or excluded. The parties may agree to exclude or limit the warranty of quality. An exclusion may cover the entire property or only specified components. OACIQ gives the following wording for an exclusion covering the whole property: “This sale is made without legal warranty of quality, at the buyer’s risk.”
The wording matters. Describing a property as being sold “as is” does not adequately explain which protections the buyer is giving up. A clearly drafted exclusion can substantially restrict the buyer’s remedies for latent defects and may also affect claims against previous sellers. The parties should review its scope with a notary or lawyer before agreeing to it.
An exclusion is not permission to deceive. A seller who deliberately conceals a known defect may still face a bad-faith or fraudulent-misrepresentation claim. It is therefore inaccurate to say that selling without warranty protects the seller from responsibility for “any other issues.”
The warranty of ownership is a separate consideration. OACIQ generally advises against excluding it except in rare circumstances. Sellers and buyers should understand exactly which warranty the proposed clause addresses.
When might a warranty exclusion be considered?
Selling without the legal warranty of quality may be considered when a property is being sold by an estate or when the seller has limited knowledge of its condition. However, inheriting a property does not remove the need to disclose known information. In brokerage transactions involving a succession, OACIQ’s seller’s declaration requirements still apply.
A seller planning to move abroad may also wish to discuss a warranty exclusion because managing a later dispute from another country could be difficult. Moving away does not, by itself, change the seller’s obligations or exempt them from liability. Any exclusion must be agreed upon by the parties and properly drafted.
There are also possible disadvantages. Depending on market conditions, a warranty exclusion may discourage prospective buyers or affect the price they are willing to pay. Buyers assume additional risk and should understand it before committing to the purchase.
OACIQ recommends a more thorough inspection when a property is being purchased without the legal warranty of quality. The inspector should be told about the exclusion so they can take it into account when assessing the property.
Protecting the transaction
A successful sale depends on more than finding a buyer and agreeing on a price. Clear descriptions, honest disclosures, and carefully drafted documents help both parties understand what they’re buying and on what terms.
For sellers, the practical approach is to verify information before publishing it, disclose known problems, explain uncertainties and keep supporting records. For buyers, review the disclosures, investigate concerns, and understand the effect of any warranty exclusion before signing. These steps support the informed consent and transparency that OACIQ’s disclosure process is designed to encourage.
An inaccurate statement will not necessarily undo a sale. But a significant misrepresentation or a concealed problem can turn a completed transaction into a costly dispute. Signing before a notary does not erase those risks.
Should you have questions or comments, please refer to the comments section at the bottom of the page. To view my past articles, click here.
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Joseph Marovitch has worked in the service industry for over 30 years. He was first director of Camp Maromac, a summer camp for children, before becoming a real estate broker, where he applies the same values of reliability and integrity. You can reach him at 514 825-8771 or at josephmarovitch@gmail.com
